The Impacts of Dairy Cooperatives on the Livelihoods and Quality of Milk from Smallholders in Selected Areas of Central Ethiopia

Abstract

The objective of this study was to evaluate the influence of dairy cooperatives
on the livelihoods of smallholder farmers and assess milk quality in selected
areas of Ethiopia’s central highlands. Drawing on data from 205 farmers
(156 cooperative members and 49 non-members), the research employed t
tests to analyze microbiological and physicochemical properties of raw milk,
alongside descriptive statistics and propensity score matching to assess
outcomes such as milk yield, selling price, household income, consumption,
and employment. Results revealed that cooperative membership significantly
boosts milk production and household income, attributed to members’
enhanced access to crossbred cows, veterinary services, inputs, and market
information. While non-members achieve marginally higher prices through
direct sales, cooperative members benefit from stable pricing, consistent
market access, and dividend earnings, resulting in greater overall financial
gains. Membership also correlates with expanded employment opportunities
due to increased herd sizes. Key challenges for cooperatives include informal
milk markets, fluctuating demand, and quality concerns, though growth
opportunities exist through urbanization, population trends, government
support, and proximity to dairy industries. Result of Laboratory analysis of 45
milk samples (30 from members, 15 from non-members) revealed significant
quality differences between the groups. Milk samples collected from non
members exhibited lower specific gravity values (1.024 to 1.023) compared to
members (1.027 to 1.028). Milk sample from members also had significantly
(P < 0.01) higher average total solids (TS) and fat composition. Overall, the
study highlighted significant differences in milk quality between cooperative
members and non-members, leading to recommendations for improved milk
handling practices.