Profitability of Dairy Cattle Production Among Smallholder Dairy Cattle Farmers in Chepalungu Subcounty, Bomet County, Kenya

Abstract

Smallholder farmers in Kenya are the majority players in the dairy sector, contributing to the country's economic performance. However, smallholder dairy cattle performance in the country is still low despite concerted efforts for improvement in recent decades. In Chepalungu Sub-County, Bomet County, dairy farming has remained a major concern for the smallholders who experience low milk production and prices. Smallholder dairy farmers produced an average of 4.3 litres of milk per cow per day, which is way below the potential national average of 8-10 litres. Besides the low milk production, smallholder dairy farmers in the study area also receive very low milk prices of about Kenya Shillings 25 to 30 per litre. Therefore, this study’s objective was to estimate the profitability of smallholder dairy cattle enterprises in Chepalungu Sub-County, Bomet County, Kenya. The study was guided by the theory of the firm, and descriptive and cross-sectional research designs were used. A sample of 155 smallholder dairy cattle farmers was selected using purposive, stratified, and simple random sampling techniques. A pretested questionnaire was used to collect primary data, while secondary data was collected through a literature review. Data were analysed using Gross Margin Analysis with the help of Statistical Package for Social Sciences (SPSS) version 26 software. Analysed data was presented using tables, graphs, charts, and figures. Gross Margin results showed that smallholder dairy enterprises were profitable with an average monthly gross margin of Ksh 2,192.40 per cow. To enhance dairy profitability, the study recommends that policymakers advance policies and strategic dairy production investments significantly reduce dairy production costs. Moreover, the study recommends the development and implementation of policies and programs that facilitate skill improvement and those that will stimulate and bolster the performance of dairy cattle production among dairy farmers. Additionally, the study recommends investments in relevant dairy infrastructure that can help reduce transaction costs and streamline the market for farm inputs and outputs.