Small-scale dairy co-ops won't cream it in SA
Why cry over spilt milk? Mainly because milk has been used to feed and grow humans and animals alike since the dawn of time.
India is the world's largest milk producer and its milk production industry employs more than 70million people.
A big part of the country's milk is gathered from small farmers with only one or two cows. Milk is collected every day, providing them with a daily income.
This social cooperative system has gone a long way to economically boosting and developing the rural areas since it was implemented by Sadar Patel in 1946.
With South Africa's high rate of unemployment, especially in rural areas, it sounds like something the country could use. But milk organisations in SA are not so sure.
The chief economist of SA's Milk Producers' Organisation (MPO), Koos Coetzee, says our milk industry is made up largely of commercial farmers with herds of anything between 100 and 1000 cows.
MPO MD Bertus de Jongh backs Coetzee, saying that while it is in the best interest of small farmers to work in group formation, cooperatives have a bad reputation in SA, owing to the political history of the country.
However, he says the government has been considering cooperative models for emerging farmers, even though commercial farmers believe it will be a step back.
The industry employs about 30000 people directly and grows at a rate of around 5% a year.
MPO deputy chairman Tom Turner says the biggest problem for small-scale farming is milk security, including aspects such as keeping the milk at the right temperatures and pasteurising it.
Another problem is that the SA dairy industry does not receive any subsidies from government.
De Jongh points out that the industry is completely open and has very low tariffs, which make it difficult for small-scale farmers to be competitive.
The Indian dairy cooperative, dubbed Amul, which means invaluable, is owned and operated by farmers without government assistance. The cooperative either self-funds its projects or gets funding from the World Bank.
And as far as milk security goes, it has quite a sophisticated system in place. Each farmer brings his or her daily milk to a central collection centre in the village every morning and evening where the milk is then measured.
A sample is taken from each lot to test the quality with a hand-operated or electronic fat-testing machine. Almost all the milk-producing villages have an automatic collection system for testing the quality of milk and to capture the information electronically.
There are also bulk cooling systems in the villages to help retain the milk's quality and freshness.
The Amul cooperative has grown from two village societies in the mid-1940s to 1163 societies with 635000 members.
Coetzee says such cooperatives have been tried in other parts of Africa with varying of success.
De Jongh points out that the MPO has spent a lot of time, energy and money on mentoring and developing projects for small-scale farmers.
While a social cooperative system might be a step back for SA's European-like dairy industry, certain partnerships and group formations will be essential to ensure empowerment of previously disadvantaged individuals and transformation of the dairy industry.