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Helping the Ugandan Dairy Sector Achieve its Potential

Challenge

The dairy sector in Uganda plays a key role as a source of household income and nutrition. Although the industry has maintained an average growth of three percent per year, in addition being actively promoted by the Ugandan government, the sector struggles to work to its full potential.

Dairy production across Uganda is dominated by small-scale farmers living in impoverished rural areas, and it is estimated that only 20 percent of the country’s milk output is processed. Strategic support for the sector will help to improve milk quality and reduce seasonal variability in milk production.

Solution

Pearl Dairy has established the second largest milk processing plant in Uganda, with a capacity of 240,000 litres of milk per day, producing mainly milk powder and butter oil. A joint IFC and GAFSP investment of $8 million in Pearl Dairy will support the expansion of Pearl’s milk processing plant. The establishment of milk collection canters and cold-storage infrastructure will help facilitate milk collection from smallholder farmers living in remote locations.

 

This project will directly improve the livelihoods of more than 10,000 farmers in vulnerable remote rural areas. Farmers will be provided with market access and technical support, and local communities will benefit from an increase in nutritional intake through their consumption of milk and other dairy products.  The project will also generate 150 new direct jobs.

Country

Uganda

Funding

Private

Focus area

  • Inclusive Business

Supervising entity

  • IFC

Results

This joint IFC/GAFSP investment in Pearl Dairy will enhance the livelihood of more than 10,000 farmers in rural areas, improving their livelihood. It will also create 150 new jobs for the local community.

By providing market access and technical support, the investment will help integrate farmers into export markets and reduce the current gap between world market prices and those dairy farmers currently receive.

The project will also contribute to food security by increasing local consumption of milk and other dairy products, thus raising the nutritional intake of the local population. 


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GAFSP’s inclusive and transparent governance is what makes us unique.

Our donors, recipients, civil society organizations, and implementing partners work together to improve the lives of smallholder farmers and their families. Thanks to the meaningful engagement of all our stakeholders, we have the right expertise and resources to direct funds where they will make the greatest impact.

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