College of Dryland Agriculture and Natural Resources Management
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Item Dairy Value Chain Analysis and its Challenges: The case of Raya-Alamata Woreda, Southern Zone, Tigray Regional State(Mekelle University, 2025-04-17) Alefu AbrehaIn Raya-Alamata, Tigray Ethiopia, dairy is recognized as a multifunctional livelihood activity. However, the sector is not well integrated with market systems and other value chain functions, leaving the associated challenges and opportunities unclear. This study aims to examine the dairy value chain and its challenges in Raya-Alamata. Data were collected from 155 respondents, including producers, retailers, and consumers, using a household survey. The collected data were analyzed using descriptive statistics and a probit model. The results indicate that the dairy value chain faces several constraints, such as inadequate feed, which reduces milk production, and animal diseases that lower yields and negatively impact herd health. Limited access to credit and financial resources restricts farmers from investing in the sector, while inadequate veterinary services hinder effective disease management. Additionally, the absence of organized marketing channels and processing centers limits farmers' selling options and bargaining power, and low milk prices discourage expansion. The cost-benefit analysis of milk production reveals that producers incur an average cost of 32 birr per liter, selling it at 98.7 birr, resulting in a profit of 66.7 birr per liter. Retailers sell milk at 120 birr, earning 15.3 birr per liter after incurring monthly marketing costs of 429,272.2 birr. Producers add significant value at 67.5%, while retailers contribute 12.5%. This analysis underscores the profitability of milk production and the importance of understanding cost dynamics within the dairy value chain. Moreover, the probit model identifies several key factors influencing milk market supply. The age of the household head positively affects milk supply, as older producers tend to have more experience and better networks. Conversely, larger land sizes may decrease milk supply, likely because farmers diversify into other crops and livestock instead of focusing solely on milk production. Additionally, as consumer demand increases, producers are likely to boost their milk supply in response. Finally, improved access to market information enables producers to make informed decisions, leading to increased milk supply as they respond effectively to market trends.