Uganda: FAO, Government to Assess Potential New Dairy Market

Kampala, Uganda — The Food and Agriculture Organization of the United Nations (FAO) has entered into a new partnership with the Dairy Development Authority (DDA) to boost exports of Ugandan milk and dairy products as well as assess potential new markets, as part of the country’s ongoing efforts to strengthen the dairy sector.

Marco V. Sánchez, Deputy Director of Agrifood Economics at FAO said knowing how competitive Ugandan milk is for international markets is the first step to boosting dairy exports, which is needed more so than ever.

“With that and the measures and investments in the Dairy Policy Action Plan, the dairy sector is set up for transformation for better production and better nutrition, leaving no one behind,” Sanchez said as he world marked this year’s World Milk Day focusing on showcasing how dairy is reducing its environmental footprint, while also providing nutritious foods and livelihoods.

DDA’s Dairy Policy Action Plan, which came into effect last year, outlines a number of measures to be taken to boost consumption, incentivize production, improve quality and tap into export potential. These include enhancing infrastructure, curbing waste and loss along the supply chain, enhancing operations at milk collection centres and processing facilities across the country, improving the overall quality and shelf-life of milk and meeting food-safety standards for exports.

The Plan notes that a growing demand for milk can also help incentivize investment throughout the dairy value chain from production to upstream and downstream operations -, which would also bring higher productivity gains, year-round supplies, and better quality.

Samson Akankiza, the acting Executive Director at Dairy Development Authority said milk plays a very important role in Uganda, not just economically for the millions of households, but also provides a core foundation for proper childhood growth and health.

“As DDA we are putting a major emphasis on increasing milk consumption domestically through the School Milk Program, and also expanding our export market portfolio for increased foreign exchange that translates to more earnings for our farmers,” he said.

“The dairy export competitiveness study is timely to re-enforce our quest for additional export markets for our milk. We are grateful for the efforts and collaboration with FAO in ensuring the growth of our dairy sector.”

These efforts to further strengthen the dairy sector come at a time when raw milk production has surged from 1.9 billion litres in 2014 to 3.2 billion litres in 2022.

Whereas exports, although on the increase in recent years, remain overly dependent on demand from key East African export markets, including neighbouring Kenya.

However, Kenya has constantly banned access of Ugandan milk on its market with the latest ban taking shape last month.

Following the implementation of the East Africa Community (EAC) Common Market in 2010, exports of milk from Uganda to Kenya rose sharply, reaching a value of $96m in 2018. That situation left Kenya dissatisfied as imported dairy from Uganda is cheaper than domestically produced dairy.

Kenyan authorities first discussed a 19% levy on dairy in 2019 from Uganda to protect the local dairy industry. This was followed up with a full import ban on milk from Uganda in 2020.

However, the ban was lifted in October 2022, with Kenyan President William Ruto stating imports of cheap milk from Uganda would benefit both countries. Interestingly, that reprieve only lasted four months.

Low domestic milk consumption

DDA estimates that domestic household consumption of milk stands at just over a half litre (550 millilitres) a day. This is 68% less than the dietary intake recommended by FAO and WHO, meaning Ugandans consume their recommended milk intake for about 2 out of the 7 days a week.