Review on Value Chain Analysis of Dairy Products in Ethiopia College of Agriculture and Veterinary Medicine

In Ethiopia, dairy serves as a source of income, employment, nutrition and health for the smallholder rural farmers. The main objective of this review to understand the system of dairy production, milk marketing channel in which smallholder dairy farmers sell dairy products and to examine how the market is functioning; to identify the role of women along the dairy value chain and constraints for their participation and to review challenges and opportunities for development of dairy value chain in Ethiopia. Accordingly, based on market orientation, scale and production intensity, three major dairy production systems can be identified: traditional smallholder; privatized state; and urban and per-urban farms. Dairy value chain development comprises extension, input supply (feed, bull services, and veterinary services) milk production, dairy processing and milk and milk products marketing. To increase the shelf life of milk products, the current practice of further processing of traditional butter and cottage cheese into traditional ghee and Metata Ayib was typical for most smallholder dairy farmers of Ethiopia. Each member of a household performs various roles related to dairy production and management; female particularly are engaged in cleaning, feeding, milking a cow, processing milk and marketing dairy products. However, the benefits obtained from dairy are mainly controlled by household head and the decision making and access to milk products are rarely controlled by female. Ethiopia has a complex dairy value chain, with both formal and informal channels. In Ethiopia, fresh milk sales by smallholder producers are important only when they are close to formal milk marketing facilities, such as government enterprise or milk groups. As dairying play significant role in the lives of the urban and peri-urban poor households, promotion of the dairy sector in Ethiopia can therefore contribute significantly to poverty alleviation as well as, availability of food and income generation. Keywords: dairy products, value addition, value chain, formal and informal market