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China-Africa Trade Information Service
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According to Luhaga Mpina, Tanzanian Minister of Animal Husbandry and Fisheries Development, there are 30.5 million head of cattle in Tanzania, which can produce 2.4 billion liters of milk a year, but still need to spend at least 30 billion shillings of imported milk every year.
Of the milk, only 56.2 per cent is processed locally, with stakeholders attributing the trend to a tough business environment including a capital crunch, price instability, market challenge, among others.
Mr Mpina said commercial banks were to blame for poor performance of the dairy industry, saying tough loan conditions were discouraging growth of the industry.
He also blamed lack of an assured market and price instability. He said per capita consumption stood at 47 litres per year against 200 litres proposed by the United Nations Food and Agriculture Organisation.Annual demand stood at 11 billion litres against actual production of 2.4 litres billion.
Mr Mpina said production stood at 150,000 litres against a production capacity of 750,000 litres per day.
The International Livestock Research Institute (ILRI) representative for Eastern and Southern Africa, Mr Amos Amore, said the trend was attributable to tough business environments such as high taxes on inputs and processing, policies, rules and regulations as well as procedures.
Ernesto Reyes, sector lead, GDP, said: "Farmer and producer groups make it possible to achieve economies of scale by improving access to inputs and services, creating incentives to raise productivity and address risks inherent in small scale production and marketing.
NMB Bank agribusiness senior manager Carol Nyangaro expressed their commitment to agriculture financing, saying presently 30 per cent to 40 per cent of the bank's portfolio goes to the sector with special focus being on value chain.