East African Business Week (Kampala)
Daniel Karibwije
23 July 2007
Kigali — Farmers in Uganda's south western district of Ntungamo have cause to smile now that their surplus milk has a ready buyer.
A Burundi businessman, Mr. Hermenegilde Ndikumasabo has held discussions with the executive of the Ntungamo Dairy Farmers' Association and unveiled plans to import 10,000 litres of milk per day from Ntungamo district to Burundi.
"The dairy industry in Burundi was destroyed by the war and we now have to import milk because there is a big deficit," Ndikumasabo.
Ndikumasabo, who is also the president of the Burundi Chamber of Commerce, Industry, Agriculture and handicrafts(CCIB), was speaking to Business Week soon after the joint meeting held at Sky Blue Hotel in Ntungamo town, south western Uganda on July 13.
The dialogue was attended by Uganda's Ambassador to Rwanda and Burundi, Mr. Richard Kabonero.
Kabonero made the initial contact with Ndikumasabo during Burundi's Independence celebrations held on July 1 in Bujumbura.
The Chamber president also met with Uganda's minister of East African Affairs Mr. Eriya Kategaya at the independece celebrations.
During the meeting modalities of transporting the milk were discussed and final plans are to be appended in a memorandum of understanding. Milk is a much needed commodity in Burundi.
"We need fresh milk in Burundi that can also be used for making yoghurt, cheese and cream. Later we can also look at other areas especially beef," said Ndikumasabo who has a dairy farm and milk plant in the country that has just emerged from a 13-year long civil war.
The chairman of the Ntungamo Dairy Farmers' Association Mr. Polly Matsiko was optimistic that the district would signal the end of surplus milk going to waste.
"We have been looking for a market and it has been a problem to us. Hopefully a deal should be struck by the end of this month."
Matsiko told Business Week that Ntungamo district produces 30,000 litres of milk per day. Of this, 20,000 litres is sold to the SAMEER Agriculture & Livestock Company, formerly the Dairy Corporation at a price of Ush370 (US$0.22) per litre.
The local farmer earns Ush240 ($0.14) per litre after all expenses such as transport have been deducted. Some of the excess milk produced is bought by GBK, a milk processing company and Virunga Dairies, also a private company.
Burundians have been buying very expensive foreign UHT milk and have had to supplement it with imported powdered milk.
When asked about the price at which the milk will be exported to Burundi the chairman was non -committal on a specific amount.
"Our main aim is to get the surplus milk bought. The farmers are very excited. It will help us to find a market for all the milk produced in Ntungamo."
In order to maintain quality, Matsiko said there will be need to invest in more milk coolers.
"We need to have enough milk coolers at the bulking centre in order to preserve the milk at four degrees centigrade. The milk needs to be kept at this temperature first at the co-operative centre before transfer to the central bulking centre to maintain quality that will command good prices."
To taste whether the East African Community is practically on the ground, Ndikumasabo hopes that there will be no hiccups as he transports milk from Ntungamo district in Uganda through Rwanda and finally into Bujumbura.
"This is the first example of a joint venture between Uganda and Burundi and is a good way to do business. Let us see whether it actually works."
He hopes that the milk will be able to move at ease through Rwanda now that Rwanda and Burundi have joined the East African Community and are operating under EAC rules and regulations.
Kabonero thanked the Dairy farmers in Ntungamo for being organized under an association which is well managed. "No investor is going to go to each farmer but would rather deal with an association."
The Ntungamo Diary Farmers Association is composed of 17 co-operative societies which make up the larger group.
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