The impact of dairy cooperatives on milk producers’ revenues of Ihuza Aborozi ba Kijyambere Bafatanyinje (IAKIB) in Gicumbi District of Rwanda. Application of Propensity Score Matching (PSM)

Abstract

Dairy cooperatives should have a significant impact in the future in terms of regenerating rural life. The pressing need in the Cooperative sector in the era of liberalized environments is to seize every opportunity available for the country. Diary co-operatives mainly from cattle production played a vital role in our country’s economy in the previous era and will do so in years to come. This study aims to assess the impact of dairy cooperatives on milk producers’ revenues in the Gicumbi district of Rwanda. The total sample involved in this research was 974, from four cow milk producers, namely Bukure MCC-Cooperative d’Elevage Moderne de Bukure (COOPEMOBU), Koperative Zamuka Mworozi (KOZAMGI) and Borozi Twisungane Kabuga-Nyamiyaga and Giramata, which form the cooperative union of Ihuza Aborozi ba Kijyambere Bafatanyinje (IAKIB). The total sample size to be taken from three cooperatives and other recorded local farmers supplying their milk to the nearest Milk Collection Centres, as preselected, is 260 milk producers, including 187 participants and 73 non-participants of dairy cooperatives. The study used a descriptive survey design, encompassing three cooperatives and other dairy producers not members of cooperatives from Gicumbi district. Descriptive statistics, t-test, Standard Deviation, means, frequency and percentages, as well as a Propensity Score Matching model were used to analyse the results of the study. The study findings show that the average total gross revenue was 551,113 Rwandan francs for these farmers, while the mean difference between dairy cooperative participants and non-participants ranged from 50,146 Rwandan francs to 168,145 Rwandan francs as program impact. This is an indication that participants in dairy cooperatives gain more compared to their factual group. The study recommends that small holder dairy producers should be supported to enable them to produce surplus milk for markets and reduce local milking cow numbers by replacing them with crossbred cows. It is recommended that governments should also strengthen milk processing cooperatives and improve their infrastructure facilities to reduce the transportation cost for small-scale dairy producers.