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Technical Feasibility Study Report Climate-Resilient and Sustainable Livestock Development Project (RRP MON 53038-001) Technical Feasibility Study Report Project Number: 53038 Loan and/or Grant Number(s): December 2020 Mongolia: Climate-Resilient Livestock Sector Development Project ii ABBREVIATIONS AFSD - Aimag Food and Agriculture Departments ALAMGAC - Agency for Land Management and Administration, Geodesy and Cartography AVSD - Aimag Veterinary Service Department ESD - Ecological Site Description FAO - Food and Agriculture Organization of the United Nations FUG - Forest User Groups GAFSP - Global Agriculture Food Security Program GAVS - General Administration of Veterinary Services GDP - Gross Domestic Product HAACP - Hazard Analysis Critical Control Point IFAD - International Fund for Agricultural Development ISO - International Organization for Standardization JFPR - Japan Fund for Poverty Reduction JICA - Japan International Cooperation Agency LCP - Livestock Competitiveness Project LGRC - Livestock Genetic Resources Centre LLC - Limited Liability Company LMIS - Livestock Management Information System LPCD - Livestock Development Policy and Coordination Department LSU - Live Sheep Units M&E - Monitoring and Evaluation MAHIS - Mongolian Animal Health Information System MF - Male Flock MNF - Mongolian Noble Fibre MOFALI - Ministry of Food, Agriculture and Light Industry MWCA - Mongolian Wool and Cashmere Association NAMEM - National Agency for Meteorology and Environmental Monitoring NF - Nucleus Flocks NFM - Nucleus Flock Managers PABU - Private Animal Breeding Units PCPU - Private Cashmere Processing Unit PFLU - Private Feedlot Unit PFU - Private Feeds Unit PIC - Project Implementation Consultants PIU - Project Implementation Unit PLMU - Private Livestock Marketing Unit PMU - Project Management Unit iii PUG - Pasture User Group PVU - Private Veterinary Unit QCBS - Quality Cost Based Selection RDC - Research Development Center RUA - Rangeland Use Agreements SAU - Soum Agricultural Unit SDC - Swiss Development Corporation SFA - Sustainable Fibre Alliance SPA - Soum Pasture Association SPMWG - Soum Pasture Management Working Group SSC - Soum Steering Committee STT - Soum Technical Team SVU - Soum Technical Support Group SVU - Soum Veterinary Unit TSF - Terminal Sire Flock UNDP - United Nations Development Program UNESCO - United Nations Educational, Scientific and Cultural Organization GLOSSARY Aimag - First level administrative sub-division, equivalent to a province. Bagh - Third level administrative sub-division, equivalent to a village Dzud - Severe climatic event in winter Govi - Desert area in southern Mongolia Khangai - Mountain range in central Mongolia About five herder families who stay together and have the Khot ail - same pasture or water sources. Khural - Elected body at bagh, soum, aimag or national level People who live in the same ecological environment, where Neg nutag/usniikhan - herders together possess the same pasture or water resources, and salt marshes. Saakhalt ail - The few khot ails or families that live nearby. The second level administrative sub-division, equivalent to a Soum - district iv CONTENTS I. PROJECT CONTEXT AND RATIONALE 1 A. Need for Investment 1 B. Project Objectives and Outputs 5 II. PROJECT LOCATION 7 A. Project Area 7 B. Selection Criteria 9 III. LIVESTOCK SYSTEMS IN THE PROJECT AREA 11 A. National Context 11 B. Production Systems 12 C. Inputs and Services 16 D. Downstream Supply Chain 18 E. Subproject Implementation Arrangements 23 F. Inter-Aimag Pasture Use Administration 62 IV. LIVESTOCK SUBPROJECT DESIGN 65 A. Bulgan Aimag Subproject 65 B. Arkhangai Aimag Subproject 79 C. Uverkhangai Aimag Subproject 95 D. Bayankhongor Aimag Subproject 111 V. CAPACITY BUILDING 127 A. Overview 127 B. MOFALI 127 C. General Administration of Veterinary Services 133 D. Research Development Center 133 E. Inter-Aimag Pasture Use Administration 135 VI. IMPLEMENTATION AND OPERATING ARRANGEMENTS 137 A. Implementation Arrangements 137 B. Implementation Schedule 140 C. Operation and Maintenance of Project Investments 141 VII. CRITICAL RISKS 142 A. Lack of Water in Proposed Wells 142 B. Extreme Climate 142 C. Alignment with Interests and Expectations of Farmers and Other Stakeholders 142 D. Health Emergencies 142 E. Livestock Market 142 F. Operation and Maintenance of Project-Financed Infrastructure 142 List of Tables Table 1: Selected Project Area ................................................................................................... 7 Table 2: Features of Traditional Classification of Regions .......................................................... 9 Table 3: Herder Groups in the Project Area ..............................................................................12 Table 4: Pasture User Groups and Soum Pasture Associations in the Project Area ..................12 Table 5: Cooperatives in the Project Area .................................................................................13 v Table 6: Forest User Groups in the Project Area .......................................................................13 Table 7: Water Points in the Project Area ..................................................................................15 Table 8: Animal Shelters and Storages in the Project Area .......................................................15 Table 9: Private Veterinary and Livestock Breeding Units in the Project Area ...........................17 Table 10: Registered Business Entities and Livestock Traders in the Project Area ...................23 Table 11: Template for Aimag and Soum Subproject Indicators and Targets ............................23 Table 12: Framework for Targets for PUG/RUA Establishment sub-agreements ......................33 Table 13: Scope of PUG/RUA development ..............................................................................34 Table 14: Herder numbers in Structures related to PUGs/RUAs ...............................................34 Table 15: Framework for Targets for PUG/RUA Implementation ...............................................35 Table 16: Targets for Animal Health ..........................................................................................39 Table 17: Framework for Targets for Livestock Marketing .........................................................42 Table 18: Targets for Sheep Breed Improvement ......................................................................52 Table 19: Cashmere Marketing Targets ....................................................................................61 Table 20: Land Classes in Bulgan Subproject Area ..................................................................67 Table 21: Population and Households in Bulgan Subproject Area .............................................67 Table 22: Herder Groups in Bulgan Subproject Area ................................................................68 Table 23: Pasture User Groups and Soum Pasture Associations in Bulgan Subproject Area ....68 Table 24: Cooperatives in Bulgan Subproject Area ...................................................................69 Table 25 Forest User Groups in Bulgan Subproject Area ..........................................................69 Table 26: Water Points in Bulgan Subproject Area ....................................................................69 Table 27: Animal Shelters and Storages in Bulgan Subproject Area .........................................70 Table 28: Total Livestock Number in Bulgan Subproject Area for Selected Years .....................70 Table 29: Livestock Numbers by Soum in 2019 ........................................................................71 Table 30: Private Veterinary Service Units in Bulgan Subproject Area ......................................72 Table 31: Traders of Livestock Products Bulgan Subproject Area .............................................73 Table 32: Major Problem and Buyers in Bulgan Subproject Area ..............................................73 Table 33: Local Legislation in Bulgan Subproject Area..............................................................74 Table 34: Bulgan: Targets Related to Grazing Management Sub-agreements ..........................74 Table 35: Bulgan: Second-Generation Sub-agreements Targets ..............................................74 Table 36: Number of and Type of Sub-Agreements in Bulgan Subproject Area ........................75 Table 37: Bulgan Subproject Implementation Schedule ............................................................75 Table 38: Livestock Outputs Without- and With-Project in Bulgan Subproject Area ...................76 Table 39: Pasture Degradation Targets in Bulgan Subproject Area ...........................................77 Table 40: Costs of Sub-agreements for Bulgan Subproject .......................................................77 Table 41: Detailed Costs by Year for Bulgan Subproject ...........................................................77 Table 42: Land Classes in Arkhangai Subproject Area ..............................................................82 Table 43: Population and Households in Arkhangai Subproject Area ........................................82 Table 44: Herder Groups in Arkhangai Subproject Area ............................................................83 Table 45: Pasture User Groups and Soum Pasture Associations in Arkhangai Subproject Area .................................................................................................................................................83
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