How a Gicumbi dairy coop became a ‘billion franc’ company

When ‘Koperative Ihuza Aborozi ba Kijyambere Bafatanyije (IAKIB)’ - a cooperative for modern dairy farmers - in Gicumbi District was formed in 2003 by vulnerable people, in Gicumbi District who had been given a cow each, it was not clear whether the Cooperative would become successful. In 2000, Heifer [International] offered cows to vulnerable people in Gicumbi District, especially widows who were heading households, so that a cow supports the livelihood improvement for their families, Agnes Mukangiruwonsanga, the President of IAKIB told Sunday Times from the cooperative’s Ngondore Milk Collection Centre in the Northern Province’s Gicumbi District. But the Cooperative has had steady progress towards commercial dairy farming as statistics from the co-operative show that as of 2016, it had a turnover of about Rwf2.3 billion. Mukangiruwonsanga said that at its inception, the Cooperative collected about 200 litres of milk per day, which has increased to 37,000 litres currently. The cooperative started with 200 members but it currently has 704 members of whom 384 are women. It started with each member contributing Rwf6,000, but currently, one has to part with Rwf300,000 to become a member. In total, the cooperative has about 7,000 dairy farmers who supply it with milk, and Mukangiruwonsanga said that it pays those farmers between Rwf160 million and Rwf180 million for their milk per month. The Cooperative buys a litre of milk at Rwf180 from farmers and resells the milk to Inyange Industries Ltd at Rwf200, according to Mukangiruwonsanga. From the milk it collects, 25,000 litres are supplied to Inyange Industries and 5,000 to Blessed Dairies. The remaining milk is sold in Kigali. IAKIB collects the milk through six Milk Collection Centres (MCCs) that it owns. This milk share is high for one cooperative compared to a total of 65,000 litres of milk that is collected daily in the entire Gicumbi District. Of those MCCs, three are investments of the cooperative, while the rest were built by the Government. Milk transporters off-loading milk at IAKIBs Ngondore Milk Collection Centre in Gicumbi District, Northern Province. / Emmanuel Ntirenganya Valence Ahishakiye, the cooperative accountant said that each of the three MCC is worth about Rwf80 million, bringing their total value to Rwf240 million. This cost includes the building and equipment which consists of cooler, generators among other materials. The cooperative also has a cold chain car that takes milk to distant markets, for proper milk transportation. Benefiting the livelihood of dairy farmers Josephine Nyiramirimo, 46, mother of four, is one of the first members of IAKIBU in 2003. She said that she was leading a miserable life before joining the cooperative, but now there is a lot of improvement in her livelihood and that of her family, thanks to the cow she was given, which enabled her to join the cooperative. “I did not own even a small piece of land to grow vegetables for my children,” she told Sunday Times. “IAKIB means a lot in my life. I now have a large piece of land from which I harvest about 800 kilogrammes of beans. For the Sweet potato produce, I cannot manage to measure it because it is too much that I freely give to other people,” she said. She said she also owns a tree plantation estimated at over Rwf3 million, and also owns a house worth about Rwf6million, all of which are the fruits of dairy farming. Jean de Dieu Harerimana, a dairy farmer from Mukarange Sector is not member of the Cooperative but supplies milk to it. The 31-year-old, father of three said that he gets about Rwf226,000 from milk per month, and says that the cooperative pays them on time. He adds that he gets about 54 litres of milk per day from his three lactating cows thanks to the nutritious feed from IAKIB, mixed with grass (forage). He further earns Rwf100,000 through the transportation of farmers’ milk to IAKIB Milk Collection Centres. Mukangiruwonsanga said that the cooperative pays health insurance – Mutuelle de Santé - for its members adding that a member with school going children and doesn’t have tuition fees is given the money by the cooperative, which the beneficiary pays through their milk produce. Gicumbi District Mayor, Juvenal Mudaheranwa, told Sunday Times that the cooperative has played a big role in helping farmers by venturing into the production of items that contribute to increased milk yields. The cooperative has had good management such that it has registered a steady growth, noting that millions of money it pays dairy farmers is contributing to the socio-economic development in the district and the country at large. “Having the Cooperative reach a level where it plans to invest in a processing plant, is a proof that it has had good performance. At the current stage, the cooperative needs special advanced management different from that of a normal cooperative. It needs professional managers and auditing committees to ensure its further success,’ he said. Food and cow feed production Mukangiruwonsanga says the cooperative has set up a cow feed processing unity with capacity to produce two tonnes per day - and maize flower (Unga) processing unit – producing four tonnes per day - for its dairy farmers to get maize easily. Maize flour is Rwf560 a kilogramme. Farmers get the maize flour and pay from their milk produce after getting their share of the proceeds. Setting up a milk processing plant Another plan is to help all its members get high lactating cows in a bid to get more milk produce and revenues. Mukangiruwonsanga said that they envisage setting up a milk processing factory in line with their aim to promote professional dairy farming. “For us to ensure professional farming, we need to have more dairy revenues which will benefit farmers more. That is why we need a dairy factory in which farmers should have shares here in Gicumbi,” she said. According to her, the Cooperative was in agreement with Blessed Dairies - a processing factory in Gicumbi District - to set up a plant that can process at least 20,000 litres of milk per day. Currently, Blessed Dairies Ltd processes about 5,000 litres of milk per day. Milton Ngirente, Owner and Managing Director of Blessed Dairies says that the growth of Rwanda’s dairy sector to the extent of ensuring large exports base will be achieved through setting up advanced factories that can produce quality produce at large scale, noting that they wanted a large factory in Gicumbi District. As per the Rwanda Development Board (RDB), the cost of a processing facility is $8.5 million and the opportunities in Rwanda dairy processing include fermented milk, yoghurt, cheese, butter, ice-cream, milk powder, ghee, flavoured milk, sweetened milk. editorial@newtimes.co.rw

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How a Gicumbi dairy coop became a ‘billion franc’ company