Samenvatting

This study was conducted to investigate dairy farming practices and gross margin at smallholder dairy farmer level to design a business model for scaling up climate-smart dairy in Ziway-Hawassa milk shed. 80 sample dairy farmers from five districts (which then categorised as urban and peri-urban dairy farmers) were selected purposively based on their dairy farming practice and purpose of the commissioner. The data was then collected through a survey (structured questionnaire) and focus group discussion (mapping, seasonal calendar and checklist). The collected data (quantitative and qualitative) were subjected to Value chain map, SWOT/PESTEC, gross margin estimation and SPSS. The results show that the existing milk chain structure includes input suppliers, producers, collectors, processors, retailers and consumers. The primary farming system in urban and peri-urban farming was livestock and mixed production system respectively. Milk production and selling was the primary purpose for keeping livestock. The dominant manure management was solid storage and dung for fuel. The feed resources of the milk shed were categorized as concentrates, green forage and crop-residue. Urban farmers were using more high energy concentrate than peri-urban farmers. The role of gender in milk production was significant. Women in peri-urban dairy farming were dominantly engaged in milking, milk processing and selling. The farm economics shows that cows in urban farming produced 12.1 litres per day and farmers supplied an average of 39.2 litres per day. However, peri-urban farmers consumed a large volume of milk at home and supplied 20.5 litres per day. The milk gross margin also shows that urban and peri-urban farmers collected 1.93 and 0.59 ETB per litre of milk. The study identified that, use of improved crossbreed, high energy feeds, biogas and composting as a climate-smart dairy farming practices of the shed. However, limitation and gaps also observed in manure handling, herd size and financial management. Therefore, the new recommended business model be suggested for linking farmers to different partners to increase milk productivity, reduce greenhouse gas emission from feed and manure and to enhance the economic efficiency of milk production.