This story was originally published by AgResults. 

Increased demand for fresh milk in Tanzania presents a major opportunity for smallholder farmers – yet, they still have low productivity. What is holding smallholder farmers (SHF) back and can the private sector be a major actor in solving this challenge?

Tanzania’s dairy sector has sizable hurdles to overcome that are present across the full value chain. Approximately 97% of Tanzania’s dairy cattle are low yield breeds which constrains productivity for smallholder farmers. Other associated factors are the SHF's limited awareness and understanding of quality inputs, low accessibility to inputs, and the lack of accessible and effective extension and advisory services. These combined deficiencies have resulted in minimal use of productivity increasing inputs and therefore reduced outcomes.

The AgResults Tanzania Dairy Challenge Project was established to incentivize private sector input suppliers to raise awareness and educate SHF on the value of adopting productivity-increasing input bundles to enhance production and strengthen dairy-based livelihoods. Conventional, supply sided ‘push’ interventions that reward activities rather than results may take years before sustained market transformations occur. However, three years into the Tanzania Dairy Challenge Project, the Pay-for-Results ‘pull’ incentive approach has already made an impactful shift in the dairy input supplier model and market, strengthening SHF’s demand for improved inputs... Read the full story on the AgResults blog.