A SMALL DAIRY FARM TO PROFIT-DRIVEN FARMING BUSINESS

 FEBRUARY 2020

Afghanistan is a country dependent on agricultural commodities and possessing a high potential for quality agricultural production, satisfying both domestic needs and export for economic development. Afghanistan vast land, suitable for agriculture production; motivated and potential human resources are substantial for country’s economic growth. However, the agribusiness and agricultural entrepreneurship in today’s open and competitive market crucially necessitates financial aids/supports for being equipped with recent technologies for fast and quality production chain. As a specific case, in Afghanistan dairy production is an important farming activity for many families in rural and urban communities as it provides a high source of income for them.

Abdul Hadi, an entrepreneurial farmer who began his business 15 years ago named “Mia Saheb” from small dairy farm to produce milk and rented a shop to sell fresh milk and manually processed dairy products such as yogurt, cheese, cream and butter. 

In 2014, Abdul Hadi got an opportunity to promote his small dairy farm to profit-driven farming business by obtaining ADF loan of AFN 10 million to purchase an automated dairy production line from India and established a standard factory in Shurandam Industrial Park of Kandahar Province, that has occupied an area of 2,000 square meters. Mia Saheb Farm was then transformed into a large-scale producer of dairy products. 

ADF finance and growing demand for pure and pasteurized products facilitated the Mia Sahib farm to further boost its business and expand its operation to 22 distribution outlets and 3 milk collection centres. Moreover, the farm has been raised up to sells 45   different forms of dairy products under its own brand name, ‘’Milo’’, including butter, cream, curd, ice cream, flavoured milk and liquid yoghurt drinks.

“I have four cows that produce more than 28 kg of milk each day. In the past, I had to go to various dairy shops and faced challenges to sell my product. Thanks to Mia Saheb Farm who purchases our product and pays us cash so that we can make our living”  Sayed Ahmad, one of hundreds of dairy farmers in Kandahar province  

A second cycle of the ADF loan amounted to AFN 6.8 million will assist the Farm to purchase ice-cream making plant, bulk milk cooling station, and other accessories. the ADF loan is a shining example on how finance is being used to support sustainable livestock development. Most importantly, the success of Mia Saheb Farm has created a viable market for many Afghan farmers across Kandahar Province. As many farmers and suppliers get up with lots of hope each early morning to lactate their cows and transport fresh milk to Mia Saheb processing facility. Since inception, ADF has disbursed more than AFN 7.6 billion in loans to agribusinesses and financial intermediaries across Afghanistan. From January 2019 to date, ADF has disbursed over AFN 800 million to 177 loan recipients benefiting over 3,200 farmers across different provinces.

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