Agricultural Growth Project - Livestock Market Development Value Chain Analysis for Ethiopia: Meat and Live Animals Hides, Skins and Leather Dairy Expanding Livestock Markets for the Small-holder Producers Date: March 31, 2013 Prepared by AGP-Livestock Market Development Project AID-663-C-12-00009 DISCLAIMER The authors’ views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development of the United States Government. 1 TABLE OF CONTENTS Table of contents ............................................................................................................. 2 List of Figures ...................................................................................................................... 5 List of Tables ....................................................................................................................... 6 Acronyms ........................................................................................................................... 7 Executive Summary Introduction ....................................................................................................................... 9 Content of the Value Chain Analyses ......................................................................... 9 Objective of the Analyses ............................................................................................ 10 Methodology and Approach ........................................................................................ 10 The 3 Value Chains: Main findings of the analysis ............................................. 11 Opportunities for Learning and Innovation ............................................................. 16 Key Government Frameworks and Project Linkages ............................................. 17 Conclusions ..................................................................................................................... 17 Meat and Live Animals Introduction ........................................................................................................................ 18 Highland Crop-Livestock and Pastoral Production Systems ............................................. 21 Live Animal and Meat Value Chains ................................................................................. 23 Breed .................................................................................................................................. 31 Sanitary-PhytoSanitary (SPS) for Meat and Live Animals ............................................... 31 Services .............................................................................................................................. 32 Research and Training ....................................................................................................... 32 Animal Health .................................................................................................................... 33 Formal and Informal Trade ................................................................................................ 34 Enabling environments ...................................................................................................... 36 Financial Services .............................................................................................................. 38 Identification and/or Traceability Systems Employed in Ethiopia .................................... 39 Market Structures and Governance .................................................................................... 40 Market segments, products and trends for meat ................................................................ 41 Extension Service............................................................................................................... 42 ICT ..................................................................................................................................... 42 Environmental issues ......................................................................................................... 44 Gender ................................................................................................................................ 44 Barriers to Growth and Competitiveness ........................................................................... 45 Recommendations .............................................................................................................. 47 2 Conclusion ......................................................................................................................... 48 Hides, Skins and Leather Introduction ..................................................................................................................... 49 Background and Global Context ................................................................................ 50 Production Process ........................................................................................................ 56 Map of HSL Value Chain ............................................................................................. 69 Summary of Value Chain Actors ................................................................................ 70 CONSTRAINTS AND OPPORTUNITIES ............................................................... 80 Conclusion ....................................................................................................................... 83 Dairy Products Introduction and Background ............................................................................................ 84 Ethiopian Dairy Market – Demand/Consumption ............................................................. 85 Ethiopia Dairy Market - Supply ..................................... 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Bookmark not defined.88 Dairy Value Chain Map / Summary of Actors .................................................................. 86 Milk Producers ................................................................................................................... 88 Milk Collection and Transport ........................................................................................... 92 Dairy Cooperatives and Farmers Organizations ................................................................ 94 Dairy Processors ................................................................................................................ 96 End Markets for Dairy Products ........................................................................................ 97 Inputs and Services ............................................................................................................ 99 Quality and Standards ...................................................................................................... 108 Meso and Macro Level Actors ......................................................................................... 109 Enabling Environment ..................................................................................................... 110 Gender Equity and Women’s participation...................................................................... 110 Barriers to Competitiveness and Potential Responses ..................................................... 111 Conclusion ....................................................................................................................... 114 Annex Annex 1: The Original 47 Markets from where data was collected for the LMIS .......... 115 Annex 2: Imports and Exports .................................................................................. 117 Annex 3: Tannery Listings ........................................................................................ 118 Annex 4: slaughterhouse Regional Distributions ................................................. 119 Annex 5: ethiopian inspection codes ....................................................................... 120 Annex 6: Ethiopian shoe manufacturers by capacity - 2012 ............................. 121 Annex 7: Investment Incentives in Ethiopia ......................................................... 122 Annex 8: Major garment companies ........................................................................ 123 3 Annex 9: costs and profitablity ................................................................................ 124 Annex 10: leather production process..................................................................... 126 Annex 11: Ethiopian Export Procedures and Currency Regulations ............... 128 Annex 12: impact of ethiopian Livestock Diseases ............................................. 129 Annex 13: Overall Ethiopian Government Livestock Policy ............................ 131 Annex 14: Growth Projections for Ethiopian Milk Consumption ................................... 132 Annex 15: Estimated Per Capita Milk Consumption ....................................................... 133 Annex 16: Average Daily per Cow Milk Production ...................................................... 134 Annex 17: Milk Transaction Prices in the Greater Addis MilkShed ............................... 135 Annex 18: Price Data - Milk and Milk Products ............................................................. 136 Annex 19: Brief Descriptions of Several Dairy Cooperatives ......................................... 138 Annex 20: List of Primary Dairy Cooperatives and Unions ............................................ 139 Annex 21: Milk cooperatives