The developing world’s smallholder livestock sector
Board of the International Federation for Animal Health, Brussels, 25 April 2013
Jimmy Smith
The global livestock sector
Total animals:17 billion
Asset value:$1.4 trillion
Employs:1.3 billion people
Uses:1/3 of the earth’sice-free surface
0
50,000
100,000
150,000
200,000
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
Mill
ion
tons
Developing
Developed
Where is the growth?Gains in meat consumption in developing countries
is outpacing that of developed countries and this is expected to continue
Four of the five highest value globalagricultural commodities are livestock products
4Source: FAOSTAT, 2010 data
Growing Incomes are a key catalyst to demand growth for livestock products
0
20
40
60
80
100
120
140
0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000
Per
cap
ita m
eat
co
nsu
mp
ion
(kg
/year)
Per capita GDP (US$ PPP)
US
Japan
Chi
Ind
Bra
Rule of thumb:
Growth in demand for Animal source foods begins to levels off when incomes exceed $10,000.
Percentage increase in demandfor livestock products
Developing Countries Developed Countries0
20
40
60
80
100
120
MeatMilkEggs
2000 to 2040
IFPRI-ILRI IMPACT model results
Far higher growth in demand will occur in developing countries
Global food production: From where?
Herreret al. 2009
Developing-country mixed crop-livestock systems, predominantly smallholders, supply the large proportion of livestock products
By 2040, 70% of global beef and milk will be produced in developing countries by smallholders in transition
2000 204040
45
50
55
60
65
70
75
80
85
90
BeefPorkLambPoultry MeatEggsMilk
IFPRI-ILRI IMPACT model results
%
Source: (Steinfeld et al. 2006)
Large productivity gaps between richand poor countries are not closing
Some developing country regions have gaps of up to 430% in milk
Africa Latin America South Asia Industrialized Countries
4111021
517
4226
397
1380904
6350
Milk (kg/cow/yr)
1980 2005
Animal disease remains a key constraint
Young Adult
Cattle 22% 6%
Shoat 28% 11%
Poultry >50% 30%
Source: Otte & Chilonda; IAEA
Annual mortality of African livestockAround half due to preventable or curable diseases
Endoparasit
esPPR
CBPP
Ectopara
sites
CCPPFM
DTry
ps
Shoat pox
Newcastl
e
Bruce
llosis
Bovine TBLS
DRVF
ECFBVD
0
1
2
3
4
5
6
7
8
South AsiaAfrica
Billi
on $
lost
yea
rly
Annual losses from selected diseases –Africa and South Asia
Estimates from BMGF
AfricaSouth Asia
Modeling gains from dairy technology interventions - Value of change in milk yield and herd growth
0%
50%
100%
150%
200%
250%
300%
350%
400%
450%
Genetics Feed Animal Health
Herd Mgmt
Perc
ent i
ncre
ase
due
to in
terv
entio
n
Reducing disease can increase milk yields up to 350% - greater than improving feed, genetics or management
Source: ILRI 2010
Smallholder livestock keepersare competitive
1. East African dairy In Kenya, 1 million smallholders keep the largest dairy herd in Africa
(larger than South Africa)
The lowest-cost milk producers globally are found in Uganda
Small-scale Kenyan dairy producers get above-normal profits of 19-28% in addition to non-market benefits (finance, insurance, manure, traction) of a further 16-21% (source: SDP-ILRI, 2005)
Small- and large-scale poultry and dairy producers in Kenya have the same levels of efficiency and profits (source: Omiti et al., 2004)
2. Vietnam pig industry 95% of production is by producers
with fewer than 100 animals
Pig producers with 1-2 sows have lower unit costs than those with more than 4 sows (ILRI 2010)
Models show industrial pig production could grow to meet no more than 12% of national supply in the next 10 years
Smallholders will continue to provide
most of the country’s pork for years to come
Smallholder livestock keepersare competitive (cont.)
Key points related to smallholder competitiveness
Smallholders will continue to supply most of thelivestock products in most developing countries
There will be different trajectories of livestock growth,with strongest dynamics in Asia
In many regions,smallholders will increasinglycommercialize theiroperations
Demand foranimal healthinputs will increase
16
Increasing opportunities for animal health inputs
17
As smallholder producers in the developing worldcontinue to commercialize, they increasingly payto reduce their animal disease burdens.
Potential private-public synergies
Joint public-private testing of innovations:– Innovative franchise models are providing smallholders with
access to agro-vets (‘Sidai’ in Kenya) – New low-cost, pen-side diagnostic tools are providing
diagnostics for smallholder settings– New mobile phone systems are helping farmers monitor
the health and reproduction of their animals (‘iCow’ in Kenya)
Enlightened self interest for poor and rich alike:Research on some disease of the South (e.g., African swine fever) can reduce threats of those diseases moving to the Northdue to climate change and increased trade
Challenges for private-public partnerships
Different animal health models and trading systems:− Need to understand demand for inputs and then test product
applications− Need innovative, low-cost products that meet smallholder
needs− Need new delivery systems that match smallholder settings
and infrastructure--Risk based rather than hazard based food safety regulations--Commodity based trade
Key messages
Demand for livestock source foods is growing faster in the in the developing than the developed world
Smallholder producers are now and will continue to be a large part of the supply response for decades to come
Animal health constraints are binding in developing countries
As smallholder systems modernize, their need for animal health and other inputs will grow
New opportunities exist for synergies between private and public investments in animal health
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