Draft Project Proposal

Project Proposal
Dairy Processing Plant

To improve the quality of raw milk for social, economic and health
reasons
April 2014
1. PROJECT DETAILS
1.1.
Project Title:
Milk Processing Plant
1.2.
Type of Project:
Dairy Project
1.3.
Project Location:
Litein
1.4.
County
Kericho
1.5.
Country
Kenya
1.6.
Region
Africa
1.7.
Project Beneficiaries:
Farmers and local community
1.8.
Donor
1.9.
Date of Implementation:
1.10.
Implementing Agent:
1.11.
Project Objective:
1.12.
Project Description:
2014
To improve the quality of raw milk for social,
economic and health reasons
Set up a dairy processing plant; a cooling plant, a
pasteurizer, sterilizer and related milk processing
equipments so as to add value through milk
pasteurization hence production of milk products
such as yoghurt among other products
1.13.
Budget Requirement:
The Total Budget for the Project will be;

Phase I: .
Phase II:
Phase II:
1.14.
Outcome of the Project
The project is expected to improve the lives of the

farmers through increased returns and improve the
economy of the area.
1.15.
Project Sustainability
Project sustainability will be ensured through clear

independent project audits, project advisory board,
competent personnel and initiating related
sustainable projects
2. BACKGROUND;
Dairy farming is a major component of many rural households in Kenya. In most villages
farmers rely heavily on cattle for their livelihood. It is estimated that dairy cattle contribute about
60% of the national milk production. Majority of Kenyan households keep an average of 1-5
cows and most of the milk is used for family consumption. With the reported production levels
this milk is sold raw and through middlemen who buy from farmers at low prices and lack of
value addition on the milk.
Farmers living in or near town centers and keeping more productive cows, sell directly to
consumers or shops, therefore never enter the supermarkets, but are sold in the street or on the
green markets.
1.1.Prime Factors Affecting Milk Marketing

These factors include: Poor Collection methods, Traditional production and marketing channels,
milk production practices, unorganized farmer community, high cost of setting up dairy plants,
role of middlemen and infrastructure.
1.1.1. Poor Collection Method
Despite various initiatives to enhance quality at various stages of the dairy chain, many
weaknesses still exist. The hygiene and handling practices at farm level are generally poor. The
collection and transportation of milk and the sale of loose unprocessed milk, is still a big
challenge as far as improving quality in the dairy chain is concerned. Limited quality control is
undertaken during milk reception.
1.1.2. Traditional production and marketing channel
Most of the dairying process exists at subsistence level and a subsistent farmer maintains 1-5
milk producing animals on his/her farm. These animals produce milk which is used to fulfill
daily household requirements and excessive amount is sold to run daily household activities.
1.1.3. Milk Production Practices

Raw milk is a perishable product and it is an expensive product to transport over long distances.
Due to lack of proper management practices and poor breeding, animal production tends to be
very low. This results in low farm profitability and inconsistency in quality
1.1.4. Unorganized Farmers Community
Most of the dairy farming is running at traditional level regarding production and marketing
process with no professional and commercial touch. Both of these activities are mostly carried
out in isolation from each other. These factors particularly hamper the profitability of farm
produce. On the other hand, organized marketing can enable individual farmers to fetch out
maximum revenue.
1.1.5. Lack of Infrastructure and poor road network
The dominant informal sector lacks infrastructure for milk collection and transportation. Milk
bulking is mostly done in open places without chilling facilities. Milk is transported in
aluminium cans or plastic containers on bicycles, motorcycles used by more than 70% of the
farmers.
1.1.6. Role of middlemen
Milk marketing in rural areas is mainly exploited by middlemen and smallholders have to rely on
middlemen to market their produce. Middlemen always have a monopolistic approach and can
exploit farmers by paying low prices, executing binding sales contracts and not passing on gains
when prices are seasonally high in response to lower supply.
2. PROJECT OBJECTIVES;
2.1.Development Objective
To improve the quality of raw milk for social, economic and health reasons
2.2. Immediate Objectives

a) Ensure reliable and better market access and openings for milk and milk products
b) increased income-generating capacities among the local community
c) Increased returns for local farmers through increased sales
d) To reduce poverty levels among the community
e) To improve consumer satisfaction
f) To improve milk processing, packaging and branding
3. PROJECT IMPLEMENTATION AND MANAGEMENT PLAN

3.1. Project Structure and Organization
Structure of the Dairy Processing plant
Milk Loading Bay
Milk Products;
o Yoghurt
o Butter
Raw Storage/ Coolers
Separation
Pasteurizer
Raw Milk: Dairy processing starts with raw whole milk from dairy farmers
Unloading/Receiving Bay: The milk is delivered to the processing center in milk containers. An
enclosed, all-weather unloading bay is required for sanitary delivery of raw milk. This area must be
adequately clean and sanitize.
Raw Milk Storage: This involves storage of milk in coolers
Separation: The first step in processing is separation. No matter what product is to be produced, the
raw milk goes through a separation process.
Raw processing: This can be done through a single line processing or multi-line processing
Pasteurization: A wide range of options can be added to the basic process unit depending on the
individual production requirements. These include; separator, sterilizer, homogenizer etc
3.2. Project activities and work plan

Phases Of
The Project
(Date)
Activities
Output /
Target
Indicators
Person In
Charge
Resources
Needed
Cost
3.3. Desired Impact and Outcome of the Project

An increased gross value of farm milk income for farmers
Creation on new jobs for the local community especially the youth and women
Improved Health among children through consumption of improved quality milk products
Economic improvement and consumer safety
Improved health among the children through consumption of healthy milk products
3.4. Project Beneficiaries

The project beneficiaries will include;
The stakeholders of the dairy plant especially the dairy farmers who supply milk to the plant
The consumers of the products i.e. the local community and the market outlets in
surrounding region
The regions economy will also benefit from the project through increased income and
improved milk business operation through an organized market chain.
3.5. Project Personnel
Project Advisory Board
Project Manager
Project Engineer
Accounts Officer
Project Administrator
Human Resource
Officer
Monitoring and
Evaluation Officer
Community Liaison
Officer
Post Project
Independent Audit
Project Committee
4. PROJECT MONITORING AND EVALUATION

4.1. Stakeholder Reference Group / Community Representatives / Project Committee
The project will have a Stakeholders Reference Group which will meet Quarterly to review
progress with the project.
4.2. Project Advisory Board
A Project Advisory Board will be established for purposes of project implementation and advice
the delivery of the main activities.
4.3. Post Project Independent Audit
A full report will be produced at the completion of the project documenting outputs and
outcomes from the project. This report will be available within 3 months of the project
completion
4.4. Monitoring and Evaluation Officer
The M&E Officer will report on the project progress every Quarter when the Advisory Board
will be holding a meeting.
5. BUDGET

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Project Proposal

Dairy Processing Plant

Milk Processing Plant

Farmers and local community

The Total Budget for the Project will be;

Outcome of the Project

The project is expected to improve the lives of the

Project sustainability will be ensured through clear

1.1.Prime Factors Affecting Milk Marketing

1.1.3. Milk Production Practices

2.2. Immediate Objectives

3. PROJECT IMPLEMENTATION AND MANAGEMENT PLAN

Raw Storage/ Coolers

Raw Milk Storage: This involves storage of milk in coolers

3.2. Project activities and work plan

3.3. Desired Impact and Outcome of the Project

3.4. Project Beneficiaries

3.5. Project Personnel

Project Advisory Board

4. PROJECT MONITORING AND EVALUATION

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