Collaboration with the private sector in Vietnam - Raf Somers (BTC)
1. Raf Somers
Vietnam Belgium Dairy Project
Brussels, 23 Nov 2016
Collaboration with the Private Sector in Vietnam
2. Vietnam Belgium Dairy Project
Main activities:
1. Increase productivity
Training of farmers
Introduce practical innovations
Strengthening Vet and AI services
2. Improve milk quality control and payment
3. Link Public and Private sector to enhance sustainable dairy
development: Dairy Vietnam (www.dairyvietnam.org.vn)
7. One price for the group
Processing
Company
Farm
Farm
Farm
Farm
Farm
Milk
Collection
Center
Milk flow Payment
Quality testing
Milk collector
8. Result of a group price
Farmers are not encouraged
to produce good quality milk
Bad farmers cannot be
identified
Penalties are shared among
farmers
Milk collectors always take
their ‘collection fee’
Relationship between farmer
and collector often determines
the milk price for each farmer
9. Our philosophy
Milk Quality can only improve if:
Better quality milk receives a
higher price
Quality is tested for each farm!
11. The story behind the scene…
The project became
middle men
We bought milk and
paid individually based on
our test (done by the milk
collector)
We sold milk to
VINAMILK based on the
quality of bulk tank
Processing company did first not want to pay
individually!
13. A new Public Private Organization
Bringing stakeholders around the table
A trustworty source of information
Promoting domestoc milk production
“More Safe Milk From Profitable Farms”
15. The story behind the scene…
Dairy Vietnam did not survive after the program ended…
The staff was dedicated, the private sponsors were ready to continue to
pay…
A challenge to find to ‘correct’ legal status
But in the end, the SC did not allow Dairy Vietnam to become an independent
organization -> it was put under the Department of livestock of the Ministry
Staff was no longer motivated
Sponsored lost interest
A missed opportunity … because of trying to be “bilaterally” correct
18. Individual price
Based on components of the milk
(FAT%, SNF%)
Penalty for poor quality
high bacteria
antibiotic residue
Bonus for good practices
Farm evaluation
Low Somatic Cell Count
19. Stimulating growth!
Farmers are encouraged to produce
better quality milk because of the better
price
Actions to produce better quality will also
result in better productivity!
20. Quality testing
Components of the milk (FAT%, SNF%, added water)
tested every delivery by milk analyzer
Bacteria (MBT), antibiotic residue (Delvo test)
tested every 14 days in the laboratory
Farm evaluation, somatic cell count (DCC)
every two months in the farm & laboratory
PENALTY
BONUS
BASIC PRICE
21. New equipment
Introducing IT solutions in the milk collection
centers:
Electronic scale
Milk analyzer
Smart cards
Microprocessor
We know the exact amount + quality of each farmer
29. Payment to farmers
Bank transfer (farmer’s choice!)
Clear feedback
2x per month
Bank get an insight in the creditability of
farmers
Milk collectors only receive a
collection fee!
30. Evaluation of Phase 1
Good farmers highly appreciate our
system
Good milk price
Bonus for good farming practices
Fair and transparent
Clear feedback
Timely payment
Thanks,
my dear
31. Evaluation Phase 1
Bad farmers
Angry when they
receive individual
penalty
Complain that
penalty period is
too long
Cannot receive
bonus
32. Evaluation of Phase 1
Milk Collectors
Many are not so happy
Less profit than before
(before they could easily cheat!)
They do receive a very fair price, but many do
not want to work honestly and they don’t like to
be controlled
Still allow bad quality milk to go into the bulk
tank because they worry to lose farmers
Only the processing company can
successfully control the milk collectors!
33. Evaluation phase 1
Processing company: high appreciation!
Want to intensify the collaboration with the
project
Report that our milk quality is better than in
other regions
They already apply the lessons learned
in other MCC
Individual testing
Individual payment
34. Evaluation Phase 1
However, some processing companies still
accept milk with added water
pay a too high price for
poor quality milk
Bad farmers and collectors can
still easily sell their milk
elsewhere.
Need for National Legislation!
35. Phase 2: Improvements
Put one quality control staff in each MCP
Collector does not perform quality
control anymore
Perform more tests in the MCC
Increase frequency of testing
For bacteria: daily methylene blue test
For antibiotic residue: daily fermenation test,
confirmation by delvo or copan test
Reduce the penalty period
36. Repeatability?
The equipment is only a tool, the intentions are more
important:
individual testing
individual price
We want to set an example for
farmer organizations
processing companies
governments
Raise awareness about the need for:
Transparent quality control
National legislation
37. Recommendations
1. Companies should make sure that farmers
understand the basics about milk quality:
• Milk composition (Fat, SNF, protein, ...)
• Added water
• Bacteria
• Residues
• Somatic cells
38. Recommendations
2. Limit as much as possible the role of intermediates
between farmers and processors
In Vietnam, we recommend that the processing
company has a quality control staff in each MCC
3. Always do a good acceptance test
• inspection of milk can (material, cleanliness)
• organoleptic test (look, smell)
• density test (added water)
• alcohol test (bacteria, colostrum)
39. Recommendations
4. Basic tests can be done daily in the MCC
Bacteria: dye reduction tests (Methylene Blue,
resazurine)
Cheap but only a rough indication
Many false negatives! (This gives the wrong
impression to farmers that the milk is good...)
TPC is much better, but needs to be done in a lab and
takes a lot of time
Antibiotic residue: fermentation test
cheap
best is to confirm positive result by Delvo or Copan
test
40. Recommendations
5. Milk composition:
Basic milk analyzers can be
placed in MCC:
close to farmer (transparent)
can detect added water easily
BUT they need a lot of maintenance and spare
parts!
In many locations it might be better to test the
composition once every 14 days in a central place
or with a mobile unit.
41. Recommendations
6. Somatic cell count:
Interesting information for farmer!
Bonus for low SCC stimulates good hygiene
practices
On farm: CMT test (info about each quarter)
In the MCC: DeLaval Cell Counter
exact number
relatively expensive per test (about 2 usd/test )
machine can be transported from MCC to MCC
42. Recommendations
7. Penalty
Farmers should understand
why they receive penalty
Farmers prefer more regular
testing and shorter penalty
period
Penalty should be balanced
with bonus
Farmers and Collectors
should receive penalty for
their faults, not for someone
else fault!
43. Recommendations
8. Infrastructure in MCC
Many poor quality cooling tanks
Frequent power cuts
Consider cooling tanks with an ice bank
Short power cuts have no effect on quality
Milk cools down faster (below critical 10°C)
Use cheaper electricity at night to make ice
44. Recommendations
9. Cleaning protocol
Milk cans & cooling tanks
need to be cleaned following
the 4 principles of good
cleaning:
Time
Temperature
Physical action
Chemicals
Acid to for protein
Alkaline detergent for
fat
45. Content
Vietnam Belgium Dairy Project
Smallholder dairy farming in Vietnam
Importance of individual quality control
Our intervention around Hanoi, Vietnam
Lessons learned
Recommendations
49. Dairy Industry in Vietnam
Dairy smallholders produce more than 90 % of the milk
The informal market is small (about 10%)
Popular dairy products are flavored milk, yoghurts and ice cream
Self supply in Vietnam is only 20%
50. Milk collection from smallholders
Dairy processors often struggle to collect the milk from
smallholders
poor quality milk
small volume
scattered farms
difficult to do quality testing
Almost no functioning cooperatives
Smallholders often receive a group price
Collectors earn too much compared to the farmers
