The economic viability of small-scale dairy farming in Zimbabwe: A case study of Marirangwe and Chikwaka

Abstract

The significant decline of large scale commercial dairy farmers in Zimbabwe has seen the role of small-scale dairy farmers as key producers and suppliers of milk being up scaled. However, this category of dairy farmers is resource poor and riddled by constraints that restrain their potential to be economically viable. The study sought to establish the economic viability status of small-scale dairy farmers in Zimbabwe and formulate strategies that will enhance their performance. The study was conducted in Marirangwe small-scale commercial and Chikwaka small-scale communal areas. A review of current literature on dairy farming with emphasis on small-scale farms sought a case-study review of their viability status in Southern and Eastern Africa. The findings of researchers in these countries established that small-scale dairy farming is either unviable or has minimal profit margins. However, the researchers were only confined to gross margin analysis to establish the economic viability of these farms and did not take heed of other measures like asset turnover ratios. The economic evaluation of small-scale dairying from this study indicated that it was not viable in Marirangwe and Chikwaka. Low capital efficiency ratios were as a result of poor utilization of existing resources. Strategies prescribed included the commercialization of fodder, establishment of breeding centres, tailor made financial products, improved governance at Milk Producer’s Associations (MPAs) level, investment in milk quality by processors and sustainable exit strategies by NGOs.