6 Summary and conclusions

This study examined the factors associated with adoption of three dairy-related technologies and practices in Coast Province, Kenya: grade or crossbred (G/C) dairy cows, Napier grass production and the infection and treatment method for protection of cattle against East Coast fever. As G/C dairy cattle have higher feed requirements and lower disease resistance than local cattle, these three technologies should be highly complementary. The principal conclusions of the analyses to date are summarised as follows:

• Adoption of a G/C animal is not a simple one-off binary decision. Households adopt and de-adopt G/C dairy cattle primarily because of the expense of replacing an old or diseased animal. Grade and crossbred dairy cattle are adopted in the first place primarily because the sale of milk increases and stabilises household income, while allowing household milk consumption to increase. This is in spite of perceived disease, feed supply and milk marketing risks.
• The probability that a household will adopt a G/C animal depends on location, characteristics of the household head, sources of information and characteristics of the farm. The probability increases if the household is located in Malindi and Kilifi rather than in Kwale. Migrants to the coast from other areas of Kenya are also more likely to adopt G/C cattle, probably because of previous experience with smallholder dairying in the highland regions of the country. Probability of adoption decreases with increasing age of the household head, but increases with increasing number of household members, presumably related to the increased size of the labour for dairy-related activities. The amount of land available to the household does not apparently constrain adoption of G/C animals. Participation in the National Dairy Development Project (NDDP) increased the probability of adoption, indicating that the project was effective in involving coastal households in dairying. This was at least partially because smallholders in coastal Kenya may experience difficulty in gaining access to money with which to purchase a G/C animal. This problem was reduced at least partially in the past through participation in dairy development projects such as NDDP. Such involvement is clearly reflected in survey analyses, where it is shown that the decision to adopt a G/C animal is strongly associated with the decision to adopt Napier grass, a technology strongly supported by NDDP.
• Survey results support the notion of the basic substitutability of dairying and other economic activities. This is consistent with the continuous nature of the adoption decision, the diversity of households that have adopted G/C animals and the fact that households adopt despite perceived disease risks. This substitutability means that keeping a G/C animal is just one activity of many that the household might engage in, as and when conditions within the household are conducive to it. For some households, purchase of a G/C animal does not necessarily involve a long-term commitment to dairy production. If the household has sufficient cash, then dairying clearly can be profitable, even on the Kenyan coast, but it takes management input.
• Adoption of dairy increases household incomes. Adopting households' perceptions of increases in income due to adoption of G/C cattle are supported by the large differences in cash incomes from dairying reported by adopters and non-adopters (one-third of total cash income for adopters versus less than 3% for non-adopting households). Dairy income comprised the largest part of the difference in total cash incomes between adopting and non-adopting households. The observed differences in total incomes between adopting and non-adopting households are supported by econometric evidence that each G/C animal owned by an adopting household increases income by KSh 4000 per month–an amount nearly equal to mean total incomes reported by non-adopting households. Thus, the adoption of G/C cattle has the potential to markedly increase total household incomes for smallholder households in coastal Kenya. This finding focuses attention on the reasons why more households in coastal Kenya have not adopted G/C cattle.
• Adoption of G/C cattle is not limited to wealthy farmers. Both the descriptive and econometric evidence support the idea that non-agricultural activities are not a key determinant of dairy adoption. The descriptive results indicate that the percentage of adopters is fairly evenly spread across all income categories, implying that adoption of G/C dairy cattle is accessible to many households, not just the wealthier ones. The econometric evidence suggests that involvement of the household head in non-farm activities does not have a systematic effect on the probability that a household will adopt G/C cattle.
• Adoption of dairy can generate paid (secondary) employment. Although only slightly more than half of the adopters employed a permanent labourer, they did so much more often than their non-adopting counterparts. Households with G/C cattle employed between one and two permanent labourers on average, compared with one permanent labourer hired for every five households without G/C cattle. The econometric evidence suggests that the linkage between the number of total or permanent hired labourers and the number of G/C cattle is not particularly strong. Further, ownership of G/C cattle appears to have little impact on the probability that a household has hired labourers. However, these results may have occurred because our survey did not distinguish between labour hired for cattle care and labour hired for other agricultural and non-agricultural tasks.
• Adoption of dairy may have a positive impact on the nutritional status of pre-school children. The incidence of chronic malnutrition (stunting) was statistically lower for children in households with cattle (G/C or local) than for those in households with no cattle. Although not all this observed difference can be attributed to milk consumption or dairy income, this result provides a starting point for future multivariate analyses that will control for other factors influencing nutritional status. Despite the potential benefits of G/C adoption, more than two-thirds of children in adopting and non-adopting households showed some degree of stunting. The prevalence of acute malnutrition seems to be little affected by adoption status: over one-quarter of children measured were at least somewhat acutely malnourished.

The milieu for smallholder dairy production at the coast is highly complex. Dairying in coastal Kenya provides benefits for adopters. For some households, adoption of a G/C dairy animal can lead to substantial increases in household income, can generate employment and can improve the nutritional status of pre-school-age children in the household. Households have various non-farm options for generating income that may serve the same purposes, however, and dairying seems to be treated as one of these options—to be engaged in from time to time as the opportunity arises. Previous dairy-related research has identified management options and practices that are viable and can be profitable for smallholders wanting to adopt or increase dairy production. Taken in the context of a risky production environment and competing opportunities for investment, the results of this study would suggest that neither the adoption nor productivity of dairying are constrained by poor availability of technology options. In terms of dairy development activities on the coast, there would seem to be two areas in particular that merit attention: mechanisms for easing access to grade and crossbred dairy cattle, either through credit schemes or through self-help smallholder co-operatives, and reducing the disease risks associated with G/C animals. Developments in both these areas would increase the propensity of smallholders to go into dairying. Whether or not such activities are viewed as worthwhile by development agencies is a question that requires a full appreciation of the opportunity costs involved and the policy goals of government.

In conclusion, the medium rainfall coastal lowlands of East Africa represent a difficult and risky environment for smallholder dairy production, yet one with access to two principal and rapidly growing urban markets, Mombasa and Dar-es-Salaam. These markets offer smallholder dairy producers, actual or potential, large margins for their milk. However, these markets and their environs also offer many other opportunities for the investment of smallholders' scarce capital. Many of these investment opportunities require smaller initial investment than dairy cattle, are less constantly demanding of family labour, require fewer specialist skills and are less risky. Of particular importance to increasing the adoption of dairy amongst smallholders will be ensuring the effective delivery of the infection and treatment method of immunisation against East Coast fever, or the delivery of the next-generation technology. Notwithstanding these reservations, dairy production and marketing has large potential for direct financial returns and indirect benefits for crop production. It is therefore likely that as smallholder agriculture in the coastal lowlands intensifies in response to human population pressure, dairying will become an important enterprise for a significant number of resource-poor families. In turn, the success of these families will depend in no small part on the products arising from the publicly funded research and development investments made during the 1980s and 1990s.