Originally published on November 10, 2014.
Before 2007, smallholder dairy farmers struggled to make their own home-grown dairy mash from corn husks, adding ground soya to the mix when available. The farmers were experiencing low milk yields and, from the training they received from a USAID-funded Land O’Lakes program, they knew their cows were lacking the proteins and vitamin and mineral supplements needed to achieve optimal yields. At the time, the farmers could neither afford to purchase better feed, nor spare the substantial time required to get to the markets that actually sold it.
In response to this need, USAID invested in a Malawian private sector input supplier through the Land O’Lakes Malawi Dairy Development Alliance, which could create an appropriate and fairly priced supplementary feed that would enable increased milk yields.
In 2007, Land O'Lakes provided Ndatani Investments with a support grant to expand its operations to so that they could provide urea mineral licking blocks and dairy mash as supplementary feed for sale to smallholder dairy farmers. The grant funding enabled Ndatani to procure a mineral licking block machine, a roasting machine for the soya and groundnuts, a maize mill and a water tank, in addition to establishing an accounting system that would enhance their financial management and controls. While this was of great help, the business still needed financing for a warehouse to store the raw materials for production. Ndatani was considered a high-risk business, because it did not have enough collateral to access a traditional commercial loan. But through the USAID-guaranteed Development Credit Authority (DCA), the largest commercial bank in Malawi agreed to loan to Ndatani the $25,000 they needed to expand their operations to better serve dairy farmers, which was successfully repaid within 18 months.
By 2012, Ndatani Investments traveled to bulking centers every week, so that rural smallholder farmers could buy the Premier Feeds brand on credit. The farmers received a 50kg bag of dairy mash at the beginning of the month and, at the end of the month, the cost was deducted from their milk sales by the bulking center. Farmers reported yields as high as 40 liters per day from their pure bred dairy cattle, thanks to their ability to provide them with Ndatani’s Premier Feeds brand for only $17 a month.