Dairy Market Study Report of Kabul, Afghanistan - IDS...

Dairy Market Study Kabul

Dairy Market Study Report of

Kabul, Afghanistan

Dairy Industry Development in Kabul, Logar and Parwan Province Project” (UTF/AFG/080/AFG)

Prepared by: Dr. Ramesh B. Munankami International Consultant

Dr. Rulang Lutfulla National Professional Officer

Mr. Abdul Hakim Hakimy National Consultant

Mr. F. Hamid Salimee National Dairy Industry Officer

August 2014


Table of Content Acknowledgement 4

Executive Summary 5

1. BACKGROUND 7

2. INTRODUCTION 8

2.1 Objectives of the Study 9

2.1.1 Specific objectives of the study 9

2.2 Methods of Study 10

2.3 Limitations 10

3. DEMAND FOR FRESH MILK AND DAIRY PRODUCTS 11

3.1 Size of the Market 11

3.1.1 Population 11

3.1.2 Consumers of dairy products 12

3.2 Demand for Dairy Products 12

3.2.1 Present potential average demand for dairy products – General

consumer 12

3.2.2 Present potential users’ demand for dairy products –

General consumer 13

3.2.3 Consumers’ basket of dairy products 14

3.2.4 Present demand for dairy products – Institutional consumer 15

3.2.5 Future Potential demand for dairy products – General consumer 17

3.2.6 Share of imports in total existing demand 17

3.2.7 Import season 19

3.3 Consumers’ Preference 19

3.3.1 Consumers’ preference for imported vs. local dairy products 20

3.3.2 Consumers’ purchasing of domestic vs. imported products 20

3.3.3 Share of import in consumers’ consumption basket 22

3.3.4 Consumers’ requirement of local dairy product 23

3.3.5 Traders’ perception on consumers’ preference 23

3.3.6 Processors’ perception on local vs. imported products 24

3.4 Prices of Dairy Products – Consumers’ Willingness to Pay 25

4. SUPPLY OF FRESH MILK 27

4.1 Milk Production 27

4.2 Marketable Surplus 27

4.3 Marketing by the Farmers 28

4.3.1 Farmers selling fresh milk to Kabul 28

4.3.2 Farmers selling dairy products to Kabul 29

5 DAIRY PROCESSING INDUSTRY OF KABUL 30

5.1 Organisation of Dairy Processing Industry of Kabul 30

5.1.1 General descriptions of dairy processing industry 30

5.2 Demand for Fresh Milk of Kabul Dairy Industry 31

5.3 Production of Kabul Dairy Industry 31

5.3.1 Products of dairy industry 32

5.3.2 Seasonality in production of dairy industry 33

5.4 Price of Milk and Processed Products 33

6. SUMMARY, CONCLUSION AND RECOMMENDATION 35

List of Tables:

Table – 3.1.1: Growth in Urban Population in Kabul Municipality: Afghanistan 12

Table - 3.2.2: Estimated Present and Future Potential Demand for Selected Dairy Products

Kabul: Afghanistan (Year: 2014) 14

Table – 3.2.4: Quantity of Dairy Products Purchased by Institutional Consumers


Kabul Market, Afghanistan 16

Table – 3.2.6: Quantity and Seasons of Milk Products’ Import, Kabul: Afghanistan 18

Table – 3.3.1: Consumers’ Behaviors on Purchasing of Dairy Product, Kabul: Afghanistan 20

Table – 3.3.2: Average Price and Consumers’ Purchasing Preference for Dairy Products

Kabul: Afghanistan 21

Table – 3.3.4: Consumers’ Consideration in Buying Dairy Products, Kabul: Afghanistan 23

Table – 3.3.5: Wholesaler/Importer’s Perception on Consumers’ Preference of

Imported and Local Dairy Product, Kabul: Afghanistan 24

Table – 3.3.6: Processors’ Perceptions on Local and Imported Products,


Table – 3.4: Wholesale, Retail Price and Margin of Imported Dairy Products


Table – 3.4.A: Price Differences in Local and Imported Dairy Products Paid by Consumer


Table – 4.1: Variations in Milk Production of the Interviewed Farmers, Kabul: Afghanistan 27

Table – 4.2: Marketable Surplus of Milk of Responding Farmers 28

Table – 4.3.1: Farmers Selling Fresh Milk, Kabul: Afghanistan 28

Table – 4.3.2: Selling of Dairy Products by the Farmers, Kabul: Afghanistan 29

Table – 5.1.1: General Descriptions of Dairy Industry, Kabul: Afghanistan 31

Table – 5.3.1: Average Production and Share in Demand for Dairy Products


Table – 5.4: Wholesale and Retail Price of Some Dairy Products, Kabul: Afghanistan 34

List of Figures

Figure – 3.1.1: Population of Kabul Municipality: Afghanistan 11

Figure – 3.2.3: Composition of General Consumers’ ‘Consumption Basket’

of Dairy Products, Kabul Market: Afghanistan 15

Figure – 3.2.4: Composition of Institutional Consumers’ ‘Consumption Basket’

of Dairy Products, Kabul Market: Afghanistan 16

Figure – 3.2.7: Seasonal Variation in the Imports of Dairy Products, Kabul: Afghanistan 19

Figure – 3.3.3: Share of Import in Total Purchase of Dairy Products


Figure - 5 3.1: Composition of Average Production of Dairy Industry


Figure – 5.3.2: Seasonal variations in Dairy Products, Kabul: Afghanistan 33

Bibliography 42

List of Annex

Annex – 2.2: Staff Participants in Data Collection Training 43

Annex – 2.2.A: Number of Respondents for Baseline and Dairy Market Study 44

Annex – 3.1.1: Total Urban and Rural Population in Kabul Province 45

Annex – 3.1.2: Different Level of Dairy Product Users – Consumer, Kabul: Afghanistan 46

Annex - 3.1.2.A: Different Category of Household and Average Consumption


Annex – 3.2.1: Estimated Present Potential Average Demand for Dairy Products in Kabul:

Afghanistan 49

Annex - 3.2.2: Estimated Present Users’ and Future Potential Demand for Dairy Products



Acknowledgement

Many people at different levels have helped and provided their supports during my

mission for analyzing the situation of Kabul, Pulle Alam and Charikar dairy markets and for

preparing this report. I extend my sincere gratitude to all of them whose names will not be

possible to list in this short acknowledgement. I cherish their friendship and the moments of

warm discussions with them. To mention few names that always come to my mind are: Dr.

Lutfullah Rlung, National Professional Officer who was very instrumental from assigning to

completion of the mission, Mr. F. Hamid Salimee, National Dairy Industry Officer and Mr.

Abdul Hakim Hakimy, National Consultant who constantly supported with all required

information to complete this study, and Mr. Shams Haq Safi, Administrative Officer who

provided all required logistics before, during and after the mission.

I am grateful to all the staff members of FAO country office in Afghanistan, specially

Ms. Abdullah RoyaNazar and Mr. Walid who provided me with a very cordial mission

management supports. Thanks to Mr. Vinod, Technical Officer for his kind supports and Ms.

Pawadee at FAO Regional Office in Bangkok who provided me with very prompt

administrative and financial procedural helps. I am very thankful to Mr. Moeen-uddin Siraj

for his professional supports for the successful completion of the mission. Also, would like to

highly appreciate the technical supports of Dr. Mohammad Aref Amanyar, Director,

Livestock Production Department, Mr. Abdul Latif Zahed, Program Director, RMLSP &

CLAP, and Mr. Shahzar Zadran, Project Manager of CLAP to undertake the survey and data

entry activities.

I would like to acknowledge the good efforts extended by the Government staff under

Department of Livestock Production for interviewing the different respondents and extend

gratitude to them all. And thanks to the responding farmers, wholesaler/importer, processors,

consumers and institutional consumer without which the study would not have been

materialized.

Ramesh Munankami (Ph. D.)

International Consultant

[email protected]

mailto:[email protected]


Executive Summary This study is undertaken to assess the market situations of fresh milk and dairy

products in Kabul city basically to assess the required dairy processing capacity to cater the

market demand. Five different levels of stakeholders of dairy value chain including the

farmer, importer/ wholesaler, processor, household and institutional consumer were

purposively interviewed in structured questionnaires to acquire necessary information for the

study. Population and present consumption pattern of dairy products as gathered from the

consumers’ survey have been used to estimate two levels of present potential demand and

three levels of future potential demand for fresh milk and milk products in Kabul markets.

There is a huge demand for fresh milk and milk products in Kabul market and is

tremendously increasing with extensive urbanization and resultant huge population increase

of the city. The present potential average total demand for pasteurized milk and yoghurt alone

is large enough that will require dairy processing units of more than 300 Ton/day capacity to

meet that demand. A more conservative estimation of users’ group only present potential

demand for those two dairy products will require processing units of 267 Ton/day capacity

for fulfilling that demand. On the other hand, more than 400 Ton/day capacity of multi-

purpose processing units will be required to meet users’ group potential demand for 12

domestically produced dairy products of Kabul market. Thus, from the present potential

demand perspectives, multi-purpose dairy processing units of at least 267 to 400 Ton/day

capacity is required to cater the Kabul city market. Also, the combined quantity demanded

and the composition of consumption basket of both general and institutional consumers

indicate that a) more than 400 Ton/day capacity multi-purpose processing units are required;

and b) the dairy processing industry in Kabul should be structured and organised with

emphasis on production of fresh pasteurized milk and yoghurt. The machineries and facilities

of the processing plants should be tuned to produce, store, handle and sell yoghurt. The

estimations of future potential demand of those 12 dairy products at low side, high side, and

very high side indicate that processing units of more than 800 Ton/day to 1500 Ton/day

capacity will be required.

The dairy processing industry of Kabul is still quite traditional. This industry is

comprised of: a) discernible and a large number of small household level ‘local’ processing

units with total processing capacity of 323 Lit./day; b) a small number of ‘mini’ dairy unit

with total plant capacity of 1,511 Lit./day; and c) a moderately organised larger units

processing more than 3000 Lit./day to 5,000 Lit./day. Many processing units of the dairy

industry are not operating at its full rated capacity. The mini type units are utilizing 81% of

their capacity. But the local type units are operating at more than their rated capacity. The

total processing capacity of the existing dairy units is estimated at 52 Ton/day in Kabul city.

The estimated processing capacity of the existing dairy industry (52 Ton/day)

is about 17.33% of the processing capacity required to meet the present average potential

demand for pasteurized milk and yoghurt (300 Ton/day) of Kabul. On the other, it amounts to

about 19.48% of the processing capacity required to meet the present potential users’ side

demand (267 Ton/day) for those two products only. There is a shortage of about 215 Ton/day

processing capacity even to meet the estimated conservative market demand. Therefore, there

is a large gap between the existing installed processing capacity of dairy industry and the

required processing capacity to meet the estimated different levels of consumers’ demand for

dairy products in Kabul. Therefore, strategies and efforts should be undertaken to add on to

the processing capacity of dairy industry of Kabul. Special efforts should be undertaken to


attract private sector investment in large dairy processing units to meet the fast growing and

also the large potential future demand for dairy products in Kabul market.

It is estimated that the existing total milk production of three targeted Project districts

(Dehsabz, Char Asiab and Qarabagh) is 97,970 Lit./day .The marketable surplus of farmers is

79.52% of their total production. But their ‘marketed surplus’ is 64.43% because they are

selling a substantial amount of fresh milk, producing certain dairy products, specially yoghurt

and butter to sale in the markets. Thus, the total marketed surplus of fresh milk will amount

to 63,122 Lit./day of all the farmers of three target districts of Kabul. This volume of milk is

far less for the dairy processing units that are required to meet the present potential demand

for fresh milk and other dairy products estimated above. Therefore, there is a very lucrative

opportunity for smallholders’ participation in the production of fresh milk. Efforts and

programme to increase milk supply by the farm household needs to be expanded and

intensified. The expected results of the Project to increase marketable milk to 7 Lit./day/HH

will not be sufficient to meet the required fresh milk of the above postulated processing units.

Collection of milk for the processing units needs to be increased by: a) increasing the number

of collection centres in Kabul; b) collecting and transporting milk from other Provinces to

Kabul. These will require maintaining a fleet of milk transporting refrigerated van/trucks.

Kabul Province does not export any amount of domestic fresh milk or dairy products.

However, it functions as transit market for imported dairy products for domestic markets like

Charikar, Pulle Alam, Jabalsaraj and others. The market segments of imported and domestic

dairy products are different and, in general, they are mutually exclusive. Therefore, direct

competition between the two categories of products is absent. In general, the present structure

of production and consumption of domestic dairy products in Kabul market do not indicate

serious competition from the imported dairy products. The study also indicate that for

enhancing the competitive edge of domestic dairy products against imported products, it is

necessary to: a) expand and improve the ‘physical distribution system’ of the local dairy

products to ensure convenient access to the consumer, and b) enhance the good quality image

of local products in the market.

As many as 72% of the consumers preferred local dairy products against the imported

ones because of their being ‘fresh’, ‘natural’ and thus good quality. The consumers are

willing and ready to pay premium price (high price) for the quality and convenient domestic

dairy products.

The price analysis indicates that the consumers are paying very high price for most of

the imported dairy products in Kabul market. The large price difference between the imported

products and local products is in favor of domestic product from the competitive position in

the market. Price consideration for the consumers is of less importance than other

considerations while buying the dairy products. Most of them are more concerned about the

‘good quality’ product and ‘good packing’ than the cheap price. The consumers are willing

and ready to pay premium price (high price) for the quality and convenient domestic dairy

products.


1. BACKGROUND

Afghanistan is very idyllically rural in its all aspects and more than three-fourth of its

population reside in rural area. The rural economy (the formal agriculture sector) alone

contributes about 35% of the GDP and agriculture production is the main source of rural

livelihoods. The country’s economy recently has registered a brisk growth rates largely

revealing the booming activities concentrated in the small urban areas or settlements where

less than 25% of the total population reside. But, there has been insignificant growth in rural

Afghanistan. Therefore the Government of Islamic Republic of Afghanistan has instigated a

number of national initiatives under the Livelihood and Social Protection Public Investment

Program which has resulted significant recovery and accomplishments in a number of areas.

Livestock keeping is an important part of the Afghan rural economy. It is the vital

component of the rural economy, both for food security as well as for income and

employment generation. For the major proportion of the rural population, cattle are the most

important animal species and increased milk production for sale and home consumption is

seen as an important opportunity for reducing their poverty and food insecurity. Therefore,

the Government of Afghanistan (GoA) has set livestock development as priority focus in its

Agriculture and Rural Development Strategy, National Agriculture Development Framework

and the National Priority Programs. In this context, the FAO and IFAD joined hands with the

Government to address the challenges of poverty reduction and food insecurity in rural areas

by improving agriculture and livestock productivity through the delivery of agriculture and

livestock services and strengthening the institutional capacity at all levels of governmental

and non-governmental organisations.

Accordingly, IFAD is supporting the Government in implementing Community

Livestock and Agriculture Project (CLAP) to improve food security of rural households in

selected districts of Kabul, Parwan and Logar Provinces. The CLAP is organised around

three mutually reinforcing components. Component 1 covers Community Development

including productive infrastructures and institutional strengthening with three sub-

components of: 1.1) Productive infrastructure; 1.2) Institutional strengthening; and 1.3)

Gender mainstreaming and capacity building. Component 2 incorporates Livestock and

Agriculture Development which is the largest component of CLAP with allocation of more

than 44% of the total Project budget. It is composed of four sub-components: 2.1) Dairy

Development; 2.2) Poultry Development; 2.3) Improved Food, Fodder and Vegetable Crops;

and 2.4) Livestock Development with ‘Kuchi’. This component 2 “aims at reducing poverty

through enhancing food security with a strong emphasis on women-headed households and

the vulnerable and marginalised within the rural communities by introducing appropriate

livestock and agricultural practices and packages, and, to a limited extent, supporting value

chain development and linkages to market”. The last Component 3 is for Project

Management, Policy Support and Young Professional Program.

The Dairy Industry Development in Kabul, Logar and Parwan Province Project”

(UTF/AFG/080/AFG) is developed and jointly implemented by MAIL/FAO to achieve the

objectives of the Dairy Development sub-component 2.1 of Livestock and Agriculture

Development Component 2 of CLAP.


2. INTRODUCTION

While there is a very strong demand for milk and dairy products in Afghanistan,

dairying is still at an early stage of development. Farmers typically have one to three dairy

animals producing five to ten liters of milk a day. The family needs are normally met first and

surplus milk is domestically processed and locally traded or sold. Thus, milk is mainly

produced by small-scale producers widely scattered in villages, although there is some semi-

intensive production of milk in and around the major urban markets. Over the last nine years,

the Food and Agriculture Organization of the United Nations (FAO) and Ministry of

Agriculture, Irrigation and Livestock (MAIL) have demonstrated a number of successful and

robust interventions in villages through integrated dairy development approach, particularly

in Kabul, Mazar, Kunduz and Herat Provinces. MAIL/FAO is currently implementing similar

dairy development project in Nangarhar province under which the Integrated Dairy Schemes

approach is being applied and farmers are encouraged to establish a network of community-

based milk producer cooperatives societies and the dairy unions.

The major outcome of the MAIL/FAO dairy projects was increased rural food

security, jobs created, income generation and empowerment of women through access to a

regular and dependable raw milk market and value addition. At the same time, the

encouraging and valuable experiences from the past Projects have also helped identify four

major limitations to dairy industry development in Afghanistan as follow:

There is a gap in the expertise in appropriate approaches to dairy industry development.

There is incompleteness in the organizational structure and institutional capabilities of all

institutions (agriculture, livestock, cooperative and private sector) involved in the dairy

development of the country at all level of governance.

Empowering and enabling them to enhance their contributions in the dairy value chain is

still challenging.

There is currently no support for Afghan innovation fostering and specifically for dairy

industry development.

On the basis of the successful on-going experience with Integrated Dairy Schemes in

five Provinces and to address the dairy development issues of Afghanistan identified above,

the MAIL/FAO/IFAD jointly developed “Dairy Industry Development in Kabul, Logar and

Parwan Province Project” (UTF/AFG/080/AFG) as sub-component 2.1 of CLAP. Its

implementation started from 1 May 2014. The Project is expected to end in 30April 2020

with a total project cost of US$ 10.5 million (IFAD contribution of US$ 8.5 million).

The overall Project goal of Livestock and Agriculture Development Component 2 of

CLAP is to reduce poverty through enhancing food security of vulnerable and marginalised

rural communities in selected districts of Kabul, Parwan and Logar Provinces through

income and/or employment generation by enhancing access to production assets, skills,

services and technologies for increasing agri/livestock production.

The Project purpose of “Dairy Industry Development in Kabul, Logar and Parwan

Province Project” (UTF/AFG/080/AFG) is to increase dairy milk production and

productivity, and improve dairy milk processing and marketing. It is expected to up-scale and

expand the dairy industry development in Afghanistan. The Project Result Matrix sets the

Projects goal as “dairy milk production, processing and marketing increased, dairy coops,


union, and federation created and enabling capacity and policy environment established”. To

achieve the goal/purpose, the Project is formulated with following four components/outputs:

2.1 Objectives of the Study

The basic objective of the study is to assess the market situations of fresh milk and dairy

products in Kabul market.

2.1.1 Specific objectives of the study

The specific objectives of this study are:

1. Identify and quantify dairy plants (local and mini) currently supplying milk and

products to Kabul city with their monthly/yearly sales volume of milk and products;

2. Determine the approximate amount and costing of raw milk being supplied

directly by the producer farmers to the consumers in those cities;

3. Assess the size of Kabul dairy market in terms of total consumption of milk and

milk products; and the share of imported milk and milk products in the total

demand of those cities;

4. Estimate the costs of milk production, processing and marketing and recommend

whether locally produced milk and dairy products can compete with imported

products;

5. Identify the issues, status and the positive aspects; as well competition of locally

produced products with imported ones.

6. Estimate the fresh milk and products being exported to the neighboring border

markets;

7. Identify opportunities and constraints for improved smallholder participation in

these production and markets;

8. Identify and specify the consumer preferences for milk and dairy products (fresh

local products vs. imported ones); and

9. Identify consumer willingness (and ability) to pay for existing and potential other

milk and dairy products.

Project’s components Component 1: Strengthening national capacity in dairy cattle husbandry, dairy

processing and marketing at field, district and provincial level.

Component 2: Developing institutional capacity among both public and private

institutions.

Component 3: Strengthening the capacity of women in dairy sector.

Component 4: Facilitating the development of enterprise by setting up a vibrant and

dynamic Afghan dairy industry.

Output 4.1: A minimum of 30 tones of milk collected through village Milk Collection

Centers (MCCs) everyday by involving at least 3,000 families in the Kabul, Logar

and Parwan Provinces and farmers regularly (weekly) remunerated for collected

milk according to quality and quantity.

Output 4.2: Expanded dairy processing plant established.

Output 4.3: Enhanced dairy market linkages for increasing volumes and efficiencies

of selected local dairy value chains.

Output 4.4: Enhanced animal feed market linkages for increasing sales/utilization

volumes.


2.2 Methods of Study

Following steps and activities were undertaken to complete this study:

a. The existing dairy market study report and information at the national level, along

with FAO dairy market study reports were reviewed. (Refer Bibliography).

b. Design questionnaire to collect data and information;

c. A dairy market study plan was discussed and data collection was organized;

d. Organize short training course to surveyors on using questionnaires forms and

survey implementation methodology. The participants to this training are listed in

Annex – 2.2.

e. Five different levels of stakeholders of dairy value chain were interviewed in

structured questionnaires through project national staffs, project counterparts and

national dairy market consultant. The respondents were purposively interviewed.

Annex – 2.2.A.

f. The survey and data management were done with the help and cooperation of

Government staff and other concerned people. Annex – 2.2.A.

2.3 Limitations

Following limitations are encountered while executing this market study:

a. Reference data and information on the dairy market and marketing situation of

Kabul market are not available as was required.

b. Detail survey of the dairy value chain stakeholders could not be implemented due

to security situations and time.

c. ‘Memory bias’ of the respondents (whoever could be approached) is high as detail

and friendly interview could not happen due to time and security situations.

d. Security situations following the Presidential election in the country constrained

the movements of the staff, especially of the international consultant.

Such constrains contributed towards delays in the data gathering, analysis and

preparation of the report as well. However, the quality of the analysis and the structure of the

study report have been maintained in line with the objectives of the study but within the

available data and information.


3. DEMAND FOR FRESH MILK AND DAIRY PRODUCTS

Two variables have been adopted to estimate the present and future potential

demand for fresh milk and milk products in the studied markets for the purpose of this study.

They are: the population and the present consumption pattern of dairy products as gathered

from the consumers’ survey.

3.1 Size of the Market

3.1.1 Population

According to the Afghanistan population statistics, the settled population of

Kabul Province in 2013-14 is 4,086,5001. About 83.55 % or 3,414,100 people lives in the

urban area (Kabul municipality) alone. Annex – 3.1.1. The average family size is estimated at

8 members/family by UNICEF. Thus, the total settled urban household is estimated at

426,763 which could be considered as the potential low size of the household consumer in the

market for dairy products in Kabul city. Because, other parts of the population like rural

population, nomadic population category, daily commuting people and temporarily living

population are excluded in this estimate.

An important happenstance from the perspective of market size of dairy

products is the rapid urbanization of Kabul. There has been an alarming growth of urban

population. During the last decade the population of Kabul has increased by more than 88%.

The population is growing very fast specially after the year 2006-07 which can be clearly

observed from Figure – 3.1.1. Many new settlements are developing within the municipality

with the influx of population from other Provinces and rapid growth in housing and real-

estate business.

1 Afghanistan Statistical Year Book 2013-14, Central Statistics Organization, Islamic Republic of Afghanistan,

http://cso.gov.af/en/page/demography-and-socile-statistics/demograph-statistics/3897

1

1.5

2

2.5

3

3.5

I

n

M

i

l

l

i

o

n

Figure - 3.1.1.

Population of Kabul Municipality: Afghanistan

Female

Male

Total



In Kabul, the annual increase of population has been very high. It has ranged

from 1.94% in the year 2005-06 to 7.53% in the year 2007-08with an average annual growth

rate of 3.83 % during the last decade. Table – 3.1.1.

Table – 3.1.1.

Growth in Urban Population in Kabul Municipality: Afghanistan In ‘000

Municipality Kabul

Year Population Growth %

2004-05 2435.4 -

2005-06 2482.6 1.94

2006-07 2536.3 2.16

2007-08 2727.4 7.53

2008-09 2831.4 3.81

2009-10 2939.7 3.82

2010-11 3052 3.82

2011-12 3168.4 3.81

2012-13 3289 3.81

2013-14 3414.1 3.80

Average 3.83

3.1.2 Consumers of dairy products

All the urbanites of Kabul do not consume fresh milk and dairy products. The

consumers’ survey reveals variation in the proportion of consumers purchasing different

dairy products. Such information for Kabul market is presented in Annex - 3.1.2. On the

average, as many as 57% of the total household, at present, do not consume dairy products

but such non-users varied for different dairy products ranging from 95% for flavored liquid

milk to only 10% for yoghurt. Similarly, 28.48% of the consumer use dairy products three

times or less a week (categorized as ‘Low user group’) and 14.33% consumer purchase either

daily or even twice a day (categorized as ‘High user group’). As in the case of non-user, the

proportion of ‘low user’ and ‘high user’ also varied for different dairy products. Based on

these survey findings, the total urban households of Kabul have been divided into three

groups: a) ‘Non-user’ of 244,066 households (57% of total household), b) ‘Low user’ of

121,542 households (28.48% of total household), and c) ‘High user’ of 61,155 households

(14.33% of total household). Accordingly, present potential demand for fresh milk and milk

products have been derived for this study purpose. Annex – 3.1.2.A.

3.2 Demand for Dairy Products

The present potential size of the demand for fresh milk and dairy products has

been estimated at two levels and of future potential demand at three levels to assess the size

of the Kabul dairy market.

3.2.1 Present potential average demand for dairy products – General

consumer

The interview with the consumers has revealed that each household (of both

low and high user groups combined), on the average, purchases 0.952 Lit./day of fresh milk.

Accordingly, the present potential average demand for pasteurized milk is estimated at

127,888 Lit./day. Similarly, the demand for yoghurt, second most important product


consumed in Afghanistan, is about 200,184 Kg./day. The estimation of present potential

average demand for other dairy products based on the total average purchased quantity by the

‘user’ groups of households in Kabul city is presented in Annex – 3.2.1. These estimates are

the high side demand estimation but at low volume because ‘other parts of the population’ are

excluded in this estimation. Thus, to meet only the potential average demand for pasteurized

milk (127,888 Lit./day) and yoghurt (200,184 Kg./day), processing units of more than 300

Ton/day will be required for Kabul market.

3.2.2 Present potential users’ demand for dairy products – General

consumer

The above demand estimation is further refined to derive more realistic picture

of present potential levels of demand for dairy products. This has been done by segregating

the total consuming households into ‘low user’ and ‘high user’ groups and their respective

average consumption. The details of their number and respective consumption level of

different dairy products as revealed by consumers’ survey in Kabul are presented in Annex –

3.1.2.A. Based on those variables, present potential users’ demand for dairy products in

Kabul market has been estimated. The details estimations are presented in Annex - 3.2.2.

The consumers’ survey reveals that only 6% of the total consumers household

(25,606 HH) are high user and 14% are low user (59,747 HH) of pasteurized milk. The high

user group, on the average, consumes 1.19 Lit./Day/HH while low user group consumes 0.3

Lit./Day/HH of pasteurized milk. Accordingly, the present potential demand for pasteurized

milk is estimated at 48,395 Lit./Day (30,471 Lit./Day of high user group plus 17,924 Lit./Day

of low user group). Similarly, the demand for yoghurt, second most important product

consumed in Afghanistan, is about 218,477 Kg./day. Such demand estimations of other dairy

products are presented in Annex – 3.2.2. Those estimations are users’ low side demand

estimation at low volume because ‘other parts of the population’ as in the average potential

demand estimation above is excluded. Thus, to meet the present potential users’ side demand

for pasteurized milk (48,395 Lit./day) and yoghurt (218,477 Kg./day), processing units of 267

Ton/day will be required.

The estimated present and future potential demand for selected 12 dairy

products that are domestically produced (imported products excluded) are summarized in

Table – 3.2.2. These products are being presently produced by KDU at Guzargha and private

dairies of Kabul. The lowest estimation of the required processing units to meet such market

demand is of more than 400 Ton/day and very high estimation is of more than 1,500 Ton/day.


Table - 3.2.2

Estimated Present and Future Potential Demand for Selected Dairy Products

Kabul: Afghanistan (Year: 2014) Product Unit Present Potential

Demand

Future Potential Demand

Average

side/low

volume

User

side/Low

volume

Low

side

High

side

Very high

side

Fresh raw milk Lit/D 173,928 122,907 199,724 203,566 472,427

Pain liquid milk (pasteurized) Lit/D 127,888 46,091 93,888 148,514 421,642

Butter Kg/D 15,130 9,120 25,657 20,591 54,732

Ghee Kg/D 25,578 7,272 7,272 60,600 60,600

Paneer Kg/D 20,671 14,318 31,213 26,301 50,960

Ice cream individual pack /Day 131,542 247,181 269,714 308,123 318,877

Ice cream family pack /Day 65,771 149,794 149,794 207,740 207,740

Local yoghurt bulk Kg/D 182,697 200,493 241,974 212,015 227,379

Pasteurized yoghurt/ cup Kg/D 17,487 17,984 32,861 29,173 45,467

Cream Kg/D 1,673 12,858 39,531 18,458 40,329

Butter milk Lit/D 255,776 94,742 166,438 104,540 143,820

Quark/ Chaka Kg/D 23,229 28,149 55,462 35,421 45,664

Total 501,533 553,934 894,020 859,179 1,563,020

The above estimates are based on the present consumption (demand) pattern

which is constrained by different factors: a) the non-availability of dairy products in the

market, b) high price of imported products, c) very limited outlets for fresh and local

products, and d) unhygienic image among some consumers of local products. Improvements

in these constraining situations and availability of different dairy products will result in

substantial increments in the number of consumer, number of dairy products consumed as

well as in the volume of their purchases. Above all, there are three very good prospects for

the increase in the demand for and for supplying of the dairy products in future in Kabul

market. Firstly, the demand for fresh milk and dairy products is continuously increasing over

the years. Such increase in demand is attributed to the increase in the general population and

increasing income level of population migrating into Kabul. Secondly, there are shortages in

the supply of different dairy products in Kabul market. Thirdly, the consumption of fresh

milk and dairy products is very important food item for an Afghan. Their significance as

important food item is reflected in the weight assigned to this product category while deriving

the Consumer Price Index of the country. All food item in total is assigned 61.3% weight in

calculating CPI while Milk and milk products (eggs are also included in this category) alone

is weighted at 5.6 % which is third after Bread & cereals (28 %) and meat (6 %). The milk

and milk products thus constitute a very important item in total food consumption in

Afghanistan. This factor further reinforces the existence of large potential demand for dairy


3.2.3 Consumers’ basket of dairy products

The composition of ‘dairy product consumption basket’ of the consumers in

Kabul city is depicted in Figure – 3.2.3. Four categories of dairy products – yoghurt, all types

of processed liquid milk, fresh milk and pasteurized milk – alone constitute 72% in the total

consumer basket. Yoghurt sold in the bulk is the single most important dairy product that

comprises 25% of the total dairy consumption basket. Liquid milk is another major


component in the total consumption basket. The processed liquid milk of all types combined

including UHT milk and flavored milk comprised another 26% of the total consumption

basket. And the fresh milk and pasteurized liquid milk constituted another 21% in the total

basket. Other nine dairy products together (excluding ice-cream) comprised only 28% of the

total consumption basket.

Figure – 3.2.3

Composition of General Consumers’ ‘Consumption Basket’

of Dairy Products, Kabul Market: Afghanistan

3.2.4 Present demand for dairy products – Institutional consumers

Different from general consumer is the category of ‘institutional consumer’

who also contributes in determining the market size of the dairy products. And most

discernible among the institutional consumers is the ‘weeding hall cum catering setup’ which

is vastly growing in Kabul. There number is increasing fast and thus the amount of dairy

products used by them. Yoghurt is the single dairy product which is used by more than 75%

of the interviewed institutional consumer. Other dairy products used by most institutional

consumer is quark (by 59 %) followed by powder milk (by 53%).

These institutional consumers are using a wide range of dairy products and the

quantity used by each of them varied largely. The details of their quantity used and price paid

are presented in Table – 3.2.4. A wide deviation between the mean and the maximum/

minimum values could be noticed. This is due to the wide variation in the quantity used by

them due to the nature of their business. The wedding hall and police/army need large

quantity of dairy products while the hotel and restaurants uses small quantity as required.

Similarly, deviation in the prices paid by these consumers is also large because some

institutions bought through annual contract while others bought on daily basis from the

market. Many of the institutional consumers reported buying their dairy products from Kabul

Dairy Union at Guzargha.

Fresh Milk

15%

Pasturised milk

6%

Butter

1%

Ghee

1%

Paneer

2%

Yoghurt Bulk

25%

Cream

2%

Butter milk

12% Chaka

3%

Yoghurt cup

2%

Processed liquid

milk

26%

Milk Powder

2%

Cheese

3%


Table – 3.2.4

Quantity of Dairy Products Purchased by Institutional Consumers

Kabul Market, Afghanistan

Quantity/Price Quantity per ‘Buying event’ Price (Afs.)

Products Max. Min. Average Max. Min. Average

Raw Milk (Lit.) 35 5 16.25 50 40 46.25

Past. Milk (Lit.) 25 6 15 70 45 59

UHT milk (Lit.) 69 69 69 71 71 71

Yogurt (Kg.) 320 8 62.26 250 32 60.67

Powder Milk 300 1 40.73 380 200 282.17

Butter (Kg.) 11.2 5 8.1 300 68.5 184.25

Paneer (Kg.) 6 6 6 300 300 300

Chaka(Kg.) 100 1 11.59 100 70 77.5

Cream (Lit.) 14 1 5 300 75 191

The composition of ‘consumption basket’ of institutional consumers is depicted in

Figure - 3.2.4.

Figure – 3.2.4

Composition of Institutional Consumers’ ‘Consumption Basket’

of Dairy Products, Kabul Market: Afghanistan

Most of the institutional consumers (81% of the respondent) expressed their

willingness and readiness to buy local products. And the conditions they forwarded for

buying are: a) good quality; b) high standard and packing; and c) possibly low price. But 19%

of the respondents are not willing to buy local dairy products mainly because of their

inconveniences. The main inconvenience is their procurement process and the large amount

of particular product which they will like to handle in convenient form. For example, an

institutional consumer requires about 4000 Kg. of powder milk to reconstitute it into liquid

milk for its large number of consumer and it is convenient for it to handle powder milk rather

than liquid milk. Same is the reason for using packaged UHT milk.

Fresh Milk 7%

Pasturised milk 6%

UHT milk 30%

Yoghurt 27%

Powder milk 17%

Butter 3%

Paneer 3%

Chaka 5%

Cream 2%


The quantity demanded and the composition of consumption basket of institutional

consumers also brings out two important implications: a) it reinforces the above mentioned

finding that higher than 267 Ton/day capacity multi-purpose processing units are required;

and b) the processing unit should be structured (machineries and plant buildings) to produce

larger amount of yoghurt than other dairy products.

3.2.5 Future Potential demand for dairy products – General consumer

Three levels of potential demand have been estimated based on the survey

results: a) low side potential demand, b) high side potential demand, and c) very high side

potential demand. The first level of potential demand is estimated with the assumption that

the marketing and promotional efforts and other factors will persuade the low user

households to consume quantity being consumed by high user household, and the high user

group will maintain their present consumption level. The details estimated quantity of

different dairy products are presented in Annex – 3.2.2 and such estimations of 12 dairy

products that are usually produced and marketed domestically are presented in Table – 3.2.2.

The high side future potential demand is estimated as medium term demand expansion and it

includes the existing estimated demand and the amount that the non-user households will

consume the quantity presently consumed by the low user households. The very high side

future potential demand is estimated as long term demand expansion and it includes the

existing estimated demand and the amount that the non-user households will consume the

quantity presently consumed by the high user households. To meet these low, high and very

high side future potential demand for dairy products processing units of larger than 800

Ton/day capacity will be required.

3.2.6 Share of imports in total existing demand

A wide range of dairy products are imported into Kabul market by the

importer/ wholesaler. A total of 6 wholesaler and 16 importer/wholesaler could be

interviewed although there is a large number of big and small wholesaler and retailer in

Kabul scattered all over the market regularly selling imported dairy products. Some of them

are operating as agent of importer/wholesaler located in Jalalabad. Few importers operate as

the exclusive dealer of international dairy houses – Nestle, Engrofood and Noorpur.


Table – 3.2.6

Quantity and Seasons of Milk Products’ Import

Kabul: Afghanistan

Dairy

product

Lit./Kg/day % of

total

user side

low

demand2

% in

Winter

% in

Autumn

% in

Summer

% in

Spring

Pasteurized

milk 13,375

29.01 34.71 14.58 23.63 27.08

Liquid UHT

milk 243,039

91.27 34.06 19.16 21.92 24.87

Dry powder

milk whole 47,056

324.30 27.60 25.27 20.92 26.21

Dry powder

milk skim 11,536

89.57 25.00 25.00 25.00 25.00

Flavored

liquid UHT 16,383

562.99 25.17 31.80 21.99 21.03

Cheese cube 540 5.34 26.98 26.98 19.05 26.98

Cheese slice 6,571 166.82 25.87 26.41 23.04 24.67

Cream

cheese 25,250

285.28 23.42 26.11 21.70 28.77

Cream 750 5.83 28.57 22.86 28.57 20.00

Yoghurt

bulk 945

0.5 26.47 25.33 24.20 24.01

Butter milk 161 0.17 26.67 20.00 26.67 26.67

Information on total quantity imported and sold in Kabul market are very sporadic.

The interviewed importers indicated that they alone are importing to the tune of 243,039

Lit./day of UHT liquid milk of different brand. The total quantity imported of all dairy

products by those interviewed traders is presented in Table – 3.2.6. The data also reveal that

the quantities of import of those dairy products which are also produced domestically and

sold in the market are very insignificant. Such products are: butter milk, yoghurt, paneer and

cream. On the other hand, imports of those dairy products which are not produced

domestically are imported in large quantity to meet the existing demand of Kabul and other

markets. Such products are: all kinds of UHT liquid milk, all kinds of powder and flavored

milk and cream cheese. Evidently, all those imported quantities are not sold in Kabul market

alone, some are send to other markets like Charikar and Pulle Alam where they have market

linkages. Table – 3.2.6.

Apart from such indication on the share of imports in total demand, the collected

information also indicate that:

a) Dairy products are not exported from Kabul. However, it is functioning as a

transit point for the imported dairy products to supply to other adjoining markets

like Charikar, Jabalsarai, Pulle Alam and others.

2 Import of some products are too large than estimated potential demand. The importers must be supplying those products to

other markets and/or overstocking.


b) Dairy products which are not domestically produced are imported in large

quantity and are sold and distributed in/from Kabul to other markets. This import

market segment is separate and different from the market segment of domestically

produced and sold dairy products.

c) Dairy products which are domestically and widely produced are imported in a

very insignificant quantity. This market segment is separate and different from the

import market segment. Thus, the imported products are not competing with the

domestically produced dairy products.

d) The competition between the imported and domestic dairy products is limited in

the front of ‘very weak substitution’ between imported and domestic products. For

example, the quantity imported of liquid/UHT milk is ‘non-ignorable’ indicating

large size of demand for liquid milk and one which is convenient for use. The

domestically produced pasteurized milk can, to a certain extent, substitute the

imported UHT liquid milk with the adoption of certain promotional marketing

strategies, and vice versa as well.

3.2.7 Import season

The traders also indicated the seasonality of the imports of different dairy

products in the market. Seasonal variation in the imports for dairy products virtually non-

existence. Most imports and of equal proportion come during winter and spring. Imports

during autumn and summer, in general, are less than in winter and spring with few

exceptions. For example, the imports of flavored milk peaks during autumn while that of

cream and butter milk peaks during summer. Import of UHT liquid milk is lowest in autumn

and increases over the year with maximum import in winter. Figure – 3.2.7.

Figure – 3.2.7

Seasonal Variation in the Imports of Dairy Products

Kabul: Afghanistan

3.3 Consumers’ Preference

Majority of the consumers buy fresh milk products from Guzergha and its window

shops and dealers located throughout Kabul or ‘neighboring shops’ or ‘super market’ in the

city. About 29% of the consumers buy fresh milk products directly from the farmer producer.

0

5

10

15

20

25

30

35

40

Winter Autum Summer Spring

%

UHT milk

Powder milk

Flavoreed milk

Butter milk

Cheese cube

Yoghurt

Cream


3.3.1 Consumers’ preference for imported vs. local dairy products

As many as 72% of the consumers preferred local dairy products as against imported

ones because of their being ‘fresh’, ‘natural’ and thus good quality. Many of the consumer

buying local dairy products think that they are able to contribute to the growth of local

economy. On the other hand, only about 28% of the consumers preferred imported dairy

products because they perceive imported products are of high quality. Some of them said that

they buy imported dairy products because it is clean, hygienic, reliable and easily accessible.

Table - 3.3.1.

Table – 3.3.1

Consumers’ Behaviors on Purchasing of Dairy Product

Kabul: Afghanistan A. Preference In % of Respondents

Local Product 72.00

Imported Product 28.00

B. Buying Directly from Farmer 29.00

C. Condition to Buy Local Product

Hygienic 75.00

Good quality 71.00

Good packing 24.00

Longer keeping 37.00

Price 43.00

Thus, this study verifies that in the case of Kabul market consumers do not

necessarily prefer to buy imported dairy products over the local products. Such consumers’

preference is also affirmed by their purchasing behavior.

3.3.2 Consumers’ purchasing of domestic vs. imported products

The consumers’ preference for local products is also reflected in their

purchasing behavior. The information in Table – 3.3.2 in this regard clearly indicate that: a)

In case of products which are not produced locally, all the consumers are forced to buy only

imported products; b) In the case of products which are domestically produced as well as

imported: i) majority of the consumer purchase local products; and ii) only few imported

products are purchased by majority of the consumers. These situations and findings are

further elaborated below in terms of share of imported and local products in consumers’

basket.


Table – 3.3.2

Average Price and Consumers’ Purchasing Preference for Dairy Products

Kabul: Afghanistan

No Dairy products Unit Average

Price Afs

Purchase (% of

respondent)

Local

Product

Total

Quantity

Purchased

Imported

Product

Total

Quantity

Purchased Local

product Imported

product

1 Fresh raw milk Lit 45 90% 10% 28.4 1.1

2 Pain liquid milk

(pasteurized) Lit 54 72% 28% 8.9 3.8

3 Plain liquid

milk - UHT Lit 78 0% 100% 0 34.7

4 Milk powder -

whole Kg 338 0% 100% 0 13.3

5 Milk powder -

skim Kg 200 0% 100% 0 9.8

6

Flavored liquid

milk-

pasteurized Lit 150 0% 100%

0 2.6

7 Flavored liquid

milk - UHT Lit 103 0% 100% 0 5.5

8 Butter Kg 260 69% 31% 17.25 4.2

9 Ghee Kg 353 100% 0% 4.0 0

10 Cheese cubes Kg 264 6% 94% 1.3 10.0

11 Cheese slices Kg 165 0% 100% 0 3.5

12 Cream cheese Kg 176 0% 100% 0 7.4

13 Paneer Kg 257 97% 3% 23.25 0.5

14 Ice cream

individual pack Pack 15 83% 17% 247.0 21.0

15 Ice cream

family pack Pack 84 70% 30% 42.1 16

16 Local bulk

yoghurt Kg 48 100% 0% 52.0 0

17 Pasteurized

yoghurt/ cup Kg 1093 58% 42%

10.4 6.9

18 Cream Kg 234 23% 77% 3.5 14.0

19 Butter milk Lit 39 89% 11% 44.9 7.5

20 Quark/ Chaka Kg 99.15 98% 2% 37.2 1.0

Consumers think that local dairy products can compete with imported products

in the market. Some even suggested that government should increase import tax on dairy

products so that local products can compete in the market. But most consumer expressed that

the local products will take large share in consumer basket if quality of local products

improved and handled very hygienically. Many also consider that the local products should

be competitively priced. Some considered that good packing with expiry date in their packing

could help local products to compete in the market. Similarly, some consumer consider that

3 Its higher than usual, possibly due to inclusion of imported flavored and/or fruit mixed yoghurt in cup.


the local products should have longer keeping quality. Table – 3.3.1. Further analyses of

consumers’ expectations of local dairy products are presented in Section 3.3.4 below.

3.3.3 Share of import in consumers’ consumption basket

The consumers were asked to report the quantity of local and imported

products that they buy while shopping the dairy products. Such information presented in

Figure – 3.3.3 clearly reflects the share of imported and local products in their total

consumption basket of dairy products. The data indicate that: a) Some products like UHT

liquid milk, flavored liquid milk, certain cheese and all kinds of milk powder which are not

produced domestically, therefore consumers buy the imported ones. And the question of

competitiveness in the market does not arise for those products. b) In the case of products

which are domestically produced as well as imported, three consumers’ behaviors from the

perspective of ‘market competitiveness’ are noticed: i) Certain products consumers purchase

only (virtually) the domestic ones; Ghee, paneer, yoghurt, and quark/chaka are such products.

Those domestic products completely dominate the market against imported ones. ii) More

consumer tend to buy local products and in larger quantity than the imported ones. Products

like fresh raw milk, ice-cream individual pack, and butter milk are such products. Those

domestic products maintain very strong competitive position in the market against imported

ones. iii) More consumer tend to buy imported products than local products but not

necessarily in larger quantity than the local ones. Few such imported products like butter, ice-

cream family pack, pasteurized yoghurt in cup and cream have good competitive position in

the market. Figure – 3.3.3

Share of Import in Total Purchase of Dairy Products

Kabul: Afghanistan

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Cheese slice

Cream cheese

Liquid UHT

Powder whole

Powder skim

Flavored pastu

Flavoored UHT

Cheese cube

Cream

Yoghurt cup

Pasturised milk

Ice cream family pack

Butter

Butter milk

Ice cream indi pack

Fresh raw

Quark

Paneer

Yoghurt plain

Ghee

In %

Import

Local


3.3.4 Consumers’ requirement of local dairy product

The price of the product does not seem to be a main consideration for the

consumers in buying the local dairy products but their expectation of being cheaper than the

imported ones is articulated. They feel that local products should be cheaper than the

imported product. The consumers’ consideration in buying dairy products in order of

importance is presented in Table – 3.3.4. It appears that the consumers give most importance

to ‘hygienic/good quality’ product while buying dairy products. Their second most

consideration in buying the dairy products is ‘well labeled’ products. Taste and color of the

product is another important factor for them. Then on fifth consideration comes the price of

the product. Other considerations in descending order of importance are: packaging, reliable,

brand, personal selling, advertising and sales promotion.

Table – 3.3.4

Consumers’ Consideration in Buying Dairy Products

Kabul: Afghanistan

Highest score of 5

Market factors Kabul

Score Rank Taste and color 4.37 3 Safety and quality 4.85 1 Brand / Manufacturer 2.81 8 Product labeling/Manufacture date 4.46 2 Packaging 3.54 6 Reasonable price 4.33 4 Access easily 4.00 5 Reliable, famous 3.34 7 Sales promotion/incentives 2.05 11 Advertising 2.09 10 Personal selling 2.59 9

Some consumers expressed that the supply of local dairy products should be increased

and made easily and constantly available to compete with imported products. They also think

that promotion/advertisement of local dairy products are necessary for it to compete with

imported products.

3.3.5 Traders’ perception on consumers’ preference

A large majority (82%) of the responding traders (wholesaler/importer)

expressed that the consumers tend to prefer imported dairy products because: Firstly, the

local products are not easily and conveniently available to the traders and consumers. As

many as 35% of the traders considered such unavailability of local product as the reason for

buying imported products by the consumers. Secondly, 18% of the respondent thinks that

imported products are easily available in all season. And thirdly, it is perceived that the

imported products are of good quality, hygienic, safe, (18% of respondents) and well packed

with appropriate dates clearly mentioned (12% of the respondents). Table – 3.3.5. The above

opinions of importers/wholesaler clearly indicate two factors for enabling local products to

compete with imported products in Kabul market: a) expansion and improvements in the

‘physical distribution system’ of the local dairy products to ensure conveniently accessible to

the consumer, and b) enhance the good quality image of local products in the market.


Table – 3.3.5

Wholesaler/Importer’s Perception on Consumers’ Preference of

Imported and Local Dairy Product

Kabul: Afghanistan

Local product Because Imported

product

Because % of

Respondents

Consumer

prefers

17.65 % 1. Own

product

(17.65% of

respondent)

82.35 % 1. Local products

are not easily

available.

2.Good quality

and Hygienic

3.Well packed

4.Easily available

35.29%

17.65%

11.76%

17.65%

Yes No

Selling

local dairy

products

15.79 % 84.21 % Only local

yoghurt and

quark/chaka

Yoghurt

Total 627

Kg/D

Quark/Chaka

Total 57 Kg./D

Some traders (18% of the respondent) reported that the consumers prefer local

product over the imported ones because the local products are ‘own’ (Afghani) products.

Table – 3.3.5. Such consumers’ emotion or attachment is a strong competitive edge and

should be utilised for competing with imported products in the market. Only a few traders (16

% of the interviewed) handling imported dairy products are selling local products as well, but

in a very insignificant quantity. The local products that they were selling were the yoghurt

(627 Kg./D) and quark/chaka (57 Kg./D).

3.3.6 Processors’ perception on local vs. imported products

A majority of interviewed processors (56%) in Kabul market also reported that

the consumers’ preference for local products is very good while 33% of them even found it to

be excellent. Consumers’ preference for local products is not less than ‘good’. Table – 3.3.6.

Table – 3.3.6

Processors’ Perceptions on Local and Imported Products

Kabul: Afghanistan In % of total respondent

Description Excellent Very good Good

Consumer prefer local

product against import

33.00 56.00 11.00 No other

responses

Imports Other processor Milk collector

The competitor for

processors

66.00 23.00 11.00

Yes Because No Because

Local products can

compete with imported

products

70.00 1. Consumers

encourage; 2. Good and

‘natural’ quality; 3.

Veterinary services

available

30.00 1. Small

processing

capacity


Only 23% of the responding processors consider their peer as competitor

while 11% of them consider the milkman who collects fresh milk from the farmers to sell

fresh in the market as their competitor. Because such milk collectors take away a portion of

their milk supply and it constrains them to operate their processing unit. Most processors

(66% of them) understand and feel that the imported dairy products are their main competitor

in Kabul market. But still, a majority of the them are very sure that their local products can

compete with imported dairy products. Because, they perceive that the local products are

natural and good quality and the consumers are very willing and self-encouraged to buy it.

Only 30% of the responding processors thought that their local products cannot compete with

imported ones mainly because of their small scale of operation. They cannot produce enough

to compete with the large imported quantity in the market. Table – 3.3.6.

3.4 Prices of Dairy Products – Consumers’ Willingness to Pay

The reported price information by wholesaler/importers and the consumer are

not accurate enough to derive any ‘pricing decision’ for a product. The purchase price and

selling price of different imported dairy products reported by the importers are presented in

Table – 3.4. The margins for different imported dairy products varied within a range of

3.69% (for pasteurized liquid milk) to 50% (for cheese slice). Only the margin for liquid

UHT milk is recorded to be 96%.

The retail margin (difference between importers’ selling price and price paid

by the consumers) for different imported dairy product is very erratic which is usually the

practice in the retail sales. They highly varied; ranging from 5.71% for pasteurized liquid

milk to 230.29% for cheese cube. The available information indicate that the consumers are

paying very high price for most of the imported dairy products in Kabul market. Table – 3.4.

Table – 3.4

Wholesale, Retail Price and Margin of Imported Dairy Products

Kabul: Afghanistan

Product

Wholesalers’ Price Afs. Consumer Paid

Price for

Imported

Products Afs

Retail

Margin %

Purchase

Price

Selling

Price

Margi

n %

Pasteurized milk Lit. 63.33 70.00 10.53 73.00 5.71

Flavored UHT Lit. 59.42 61.61 3.69 103.00 67.18

Liquid UHT Milk Lit. 36.23 71.11 96.27 87.00 22.35

Powder milk whole Kg. 210.23 226.60 7.79 339.00 49.60

Powder milk skim Kg**. 447.50 588.00 31.40 NA NA

Cheese cubes Kg. 83.30 87.50 5.04 289.00 230.29

Cheese slice Kg. 34.20 51.30 50.00 165.00 222.22

Cream cheese Kg. 78.15 80.85 3.45 182.00 125.11

Butter milk Kg. 60.00 66.00 10.00 37.00 22.22

Yogurt cup Lit. 40.00 49.50 23.75 1184.00 138.38

Quark Lit. 81.50 100.00 22.70

Cream Lit. 129.20 136.00 5.26 232.00 70.59

**Reported prices are unreliable.

4 Its higher than usual, possibly due to inclusion of flavored and/or fruit mixed yoghurt in cup


A comparison of average price paid for imported and local dairy products by

the consumers reveals that local products are selling cheaper than the imported products in

Kabul market. For example, the price of local pasteurized milk is Afs. 46/Lit. while it is Afs.

73/Lit. for imported one. Similarly, price paid for local yogurt in cup is Afs. 105/Kg. but for

imported one, consumers on the average are paying Afs. 118/Kg. Similar is the case for ice-

cream – Afs. 15/pack for local individual packet and Afs. 21/pack for imported one. Such

large price difference between the imported products (comparatively higher) and local

products (comparatively lower) is in favor of local product from competitive position in the

market. But in case of two important dairy products – cream and butter – the price of local

product is higher than of imported ones. Table – 3.4.A.

Table – 3.4.A

Price Differences in Local and Imported Dairy Products Paid by Consumer

Kabul: Afghanistan

No Dairy products Unit Average

Price Afs

Price paid

for local

product

Afs

Price paid for

imported

products Afs

1 Plain liquid milk

(pasteurized) Lit 54.00 46.00 73.00

2 Plain liquid milk - UHT Lit 87.00 87.00

3 Milk powder - whole Kg 338.00 339.00

4 Milk powder - skim Kg 373.00 373.00

5 Flavored liquid milk-

pasteurized Lit 150.00 150.00

6 Flavored liquid milk -

UHT Lit 103.00 103.00

7 Butter Kg 260.00 280.00 232.00

8 Ghee Kg 353.00 353.00

9 Cheese cubes Kg 264.00 179.00 289.00

10 Cheese slices Kg 165.00 165.00

11 Cream cheese Kg 176.00 125.00 182.00

12 Paneer Kg 257.00 257.00

13 Ice cream individual pack Pack 15.00 15.00 21.00

14 Ice cream family pack Pack 84.00 70.00 125.00

15 Local bulk yoghurt Kg 48.00 48.00

16 Pasteurized yoghurt/ cup Kg 109.00 105.00 118.00

17 Cream Kg 234.00 243.00 232.00

18 Butter milk Lit 39.00 40.00 37.00

19 Quark/ Chaka Kg 99.15 99.15

The consumers wished the price of dairy product would have been less than

what they are paying at present. Such desire on the part of the consumer is very natural. But

price consideration for the consumers is of less importance than other considerations while

buying the dairy products. Most of them are more concerned about the ‘good quality’ product

and ‘good packing’ than the cheap price. Table - 3.3.4. It indicates that consumers are willing

and ready to pay premium price (high price) for the quality and convenient dairy products.


4. SUPPLY OF FRESH MILK

A wide variation in the yield per cow and total production per household are reported

by the farmers. An attempt has been made below to estimate the total production and

marketing practices of milk by the farmers.

4.1 Milk Production

The present average milk production in a day from different breeds of milking

cow and during summer and winter is presented in Table – 4.1. Farmers, on the average,

own less than 2 milking cows of all three breeds considered. The milk yield per cow per

day of exotic breed is higher than cross breed and of cross breed is higher than local

breed. Also, the survey confirms that the yield per cow per day of all the breeds

considered is higher during summer than in the winter. Based on those indicators, total

milk production of three Project districts (Dehsabz, Char Asiab and Qarabagh) is

estimated. The estimated total production for Kabul is 97,970 Lit./day of which 57% will

be available during summer and 43% during winter. Table – 4.1.

Table – 4.1

Variations in Milk Production of the Interviewed Farmers

Kabul: Afghanistan Province Yield/Day/Cow Lit.

Breed/Yield Summer Winter Average

A. Local breed milking cow

1.49/HH

7.67 5.79 6.77

Total number of local cows in 3

Project districts

5450

Total milk production from local

breed Lit.

41,802 31,556 36,897

B. Cross breed milking cow 1/HH 13.73 11.65 12.60

Total number of cross breed cows

in 3 Project districts

1628

Total milk production from cross

breed Lit.

22,352 18,966 20,513

C. Exotic breed milking cow

1.07/HH

17.94 13.09 15.57

Total number of exotic breed cows

in 3 Project districts

2605

Total milk production from exotic

breed Lit.

46,734 34,100 40,560

Total milk production Lit. 110,888 84,682 97,970

4.2 Marketable Surplus

The marketable surplus of fresh milk of the farmer on the average is 79.52% of total

production in Kabul. The remaining 20.48% is consumed by the farm family. This is

simply calculated by deducting only the household consumption of fresh milk of the

farmer from their total milk production. Other milk based products produced and

consumed by the farmers derived from their fresh milk production is not included here. In


fact, farmers are selling other dairy products as well. Thus, their ‘marketed surplus’ of

fresh milk is about 64.43% of total production, lower than their ‘marketable surplus’.

Table - 4.2.

Table – 4.2

Marketable Surplus of Milk of Responding Farmers

Province Milk

Production

Lit/Day/HH

Consumption

Lit/Day/HH

Marketable

Surplus

Lit/Day/HH

Marketable

Surplus in

% of Total

Production

Marketed

Surplus5 in

% of Total

Production

Kabul 12.50 2.56 9.94 79.52 64.43

The marketable surplus of milk in three Project districts (Dehsabz, Char Asiab and

Qarabagh) will thus be 77,905 Lit./day and ‘marketed surplus’ will be 63,122 Lit./day. This

amount will be sufficient to operate a multi-purpose dairy processing unit of 60 -70 Ton/day

capacity. It may be little less than that capacity because the farmers are also selling fresh milk

and certain dairy products by themselves directly to the consumers and shops in nearby

markets.

4.3 Marketing by the Farmers

The farmers in Kabul Province are marketing their milk in different ways at

local and other markets.

4.3.1 Farmers selling fresh milk to Kabul

A large number of farmers/producers are supplying fresh milk to Kabul

market – about 41% of the total interviewed farmers. The combined volume of their sale is

856 Lit./day at the average price of Afs. 29.39/Lit. Thus, total sales value is around Afs.

25,158/day. About 50% of the interviewed farmers in Kabul are selling their produce to shops

who are selling fresh milk and other dairy products while the other half are selling directly to

the consumers. Table – 4.3.1.

Table – 4.3.1

Farmers Selling Fresh Milk, Kabul: Afghanistan

Supply/Province Kabul

Supply fresh milk to Kabul 40.98% (Yes)

Supply destination Shops/Consumer

Supplied quantity Lit/day 856

Average price Afs/Lit. 29.39

Supplied value Afs/day 25,158.00 Problems in supplying 16% (Yes)

Supply dairy products to

neighboring markets

70.21% (Yes)

Supply destination Shops/Consumer

Farmers are selling their products in Kabul market without problem. Only 16% of the

interviewed farmers reported transportation as a constraint for selling their milk to Kabul.

5 Marketed surplus is the actual amount of milk sold by the farmers in Kabul market. It does not include fresh milk utilized

by farmers to produce other dairy products for self-consumption and sell.


The survey reveals that the small farmers are harnessing the opportunities created by the large

and expanding demand for milk products in Kabul city and profitably.

4.3.2 Farmers selling dairy products to Kabul

More than 70% of the respondents are selling dairy products other than the

fresh milk in Kabul and other near-by markets to the shops and/or directly to the consumers.

Table – 4.3.1. They are selling substantial quantity of yoghurt – more than 7,023 Kg./week.

Besides, some of them are also selling butter – about 147 Kg./week. A detail of the products

sold by them are presented in Table – 4.3.2.

Table – 4.3.2

Selling of Dairy Products by the Farmers

Kabul: Afghanistan

Province Kabul

Product Unit/

week

Quantity Price Afs

Fresh milk Lit 4,879 29.39

Yoghurt Kg 7,023 30.43

Butter Kg 147 350.00

Paneer Kg 0 0

Cream Lit 0 0

Butter milk Lit 0 0

Ghee Kg 0 0

Chaka Kg 0 0


5 DAIRY PROCESSING INDUSTRY OF KABUL

There are number of ‘local’ and ‘mini’ dairy plants in Kabul that process fresh milk

and produce and sell some selected dairy products to consumers in the city. Some of them

were interviewed for the purpose of this study, but sufficient information could not be drawn

due to their ‘shy’ nature to share their business information.

5.1 Organisation of Dairy Processing Industry of Kabul

The dairy processing industry in Kabul is still quite traditional in nature. This industry

is comprised of three sub-sectors in terms of nature and volume of the processing units. The

discernible sub-sector is a large number of small household level ‘local’ processing unit (57%

of the respondents) which process as small amount as 30 Lit. to 1000 Lit./day with average

processing capacity of 323 Lit./day. This sub-sector provides large number of employment,

mostly self-employment, and widely scattered in the city to cater the needs of the consumers.

The second category is a small sub-sector comprised of so called ‘mini’ dairy unit (43% of

the respondents) processing 300 Lit. to 3,000 Lit./day with average plant capacity of 1,511

Lit./day. Lastly, there is a moderately organised large units with improved technology

processing more than 1000 Lit./day to 5,000 Lit./day (processing plant operated by Kabul

Dairy Union at Guzargha). This sub-sector is very small in number but processing larger

volume than other two sub-sectors. Besides Guzargha unit of KDU, other large processing

units are: Shiere Afghan with 1,000 Lit./day, Dihqan Roze with 3,000 Lit./day, Khorshid

Pakiza with 2,000 Lit./day, Mashal dairy with 3,000 Lit./day, Nazonosh Dairy 2400 Lit./day

and Kabul Afghan Dairy with 1000 Lit./day.

5.1.1 General descriptions of dairy processing industry

Many processing units of the dairy industry are not operating at its full

installed capacity. A comparison between their rated capacity and fresh milk collected by

them indicate that the mini type units, on the average, are utilizing 81% of their capacity. But

the local type units, on the average, are collecting more fresh milk than their rated capacity

indicating the operation of more than 8 hours a day. The main constraint for the dairy

industry is reported to be the insufficient supply of electricity and transportation. Some mini

type unit reported that the constraint for them is the old technology and machineries of their

units. Both types of units are collecting milk from outside of Kabul district as well at the

average distance of about 25-26 Km. Majority of the local units are paying the farmers and

milk suppliers on weekly basis but majority of mini type processing units make payments on

daily basis. The processors are selling their products either through their own shop or vendors

or through supermarket. A large majority of both local and mini type units sell from their

own shops in the city. Table - 5.1.1.


Table – 5.1.1

General Descriptions of Dairy Industry

Kabul: Afghanistan Description/Type of Unit Local Mini Total

Respondents % 56.52 43.48 100.00

Average Plant capacity Lit/D 322.75 1511.11 16,182

Avg. Milk Collection distance Km. 26.13 25.71

Avg, Milk Collection Lit./D 417.61 1231.25 8,609

Avg. Price paid Afs./Lit. 28.11 30.13 29.06 Avg.

Mode of payment

Weekly Respondents % 66.67 11.11

Daily Respondents % 33.33 88.89

Buy from cooperatives

Want to buy (Respondents %) 23.08 80.00

Don’t want to buy (Respondents %) 76.12 20.00

Make cooperative business partner

Yes (Respondents %) 30.00 62.50

No (Respondents %) 70.00 37.50

Selling from

Own shop (Respondents %) 80 60

Local vendor (Respondents %) 10 0

Supermarket(Respondents %) 0 20

Wholesaler (Respondents %) 10 20

The processors were asked if they would like to establish business linkages with the

farmers’ cooperatives established by the Project. It is interesting that the mini type processing

units who require larger quantity of fresh milk than the local type units expressed that they

(80% of the them) want to buy milk from those cooperatives and are willing to work with the

cooperatives as business partner. However, a majority of local dairy processing units did not

wanted to buy from those cooperatives (76.12% of the them) and also are not willing to make

them business partner (70% of them). Table - 5.1.1.

5.2 Demand for Fresh Milk of Kabul Dairy Industry

Information on total number of dairy processing units in Kabul market is not

available. Therefore, total demand estimation could not be made. However, an estimation has

been arrived at with available information. The total installed or operating capacity of all the

interviewed local and mini processors is 16,182 Lit./day. Assuming that the survey covered

only 40% of the existing dairy processing unit, then the total demand for fresh milk of all

those processing units is estimated at 40,455 Lit./day. The moderately organised

comparatively larger sector as mentioned above is comprised on seven units and their total

combined installed capacity is 12,400 Lit./day. Thus, the minimum level demand for fresh

milk of the dairy processing industry of Kabul is 52,855 Lit./day.

5.3 Production of Kabul Dairy Industry

The interview of the selected processors could not pick up the complete production

status of Kabul dairy industry. The very popular products like butter milk and chaka/quark

failed to include.


5.3.1 Products of dairy industry

The available data indicate that fresh milk and yoghurt are two most important

products produced by both local and mini type processing unit. The details of their

production composition and their share in different levels of demand for the products are

presented in Table – 5.3.1.

Table – 5.3.1

Average Production and Share in Demand for Dairy Products

Kabul: Afghanistan

Type of Unit Local Mini

Product/Season Spr Sum Aut Win Total Spr Sum Aut Win Total

Average

Fresh milk Lit/D 1056 1106 1088 820 4070 900 1400 793 560 3653

Yoghurt Kg/D 196 211 161 123 691 894 1039 1013 555 3501

Cheese Kg/D 20 15 10 17 62 60 100 50 30 240

Ghee Kg/D 0 20 0 0 20 0 0 0 0 0

Butter Kg/D 11 10 10 12 43 63 297 62 63 485

Cream Lit/D 20 15 10 17 62 70 70 55 60 255

Ice-cream Lit/D 0 0 0 0 1000 1000 0 0 2000

Total Production of Respondents Combined % of

Average

demand

% of user

side

demand

% of low

side

demand

Fresh milk Lit/D 7980 9730 6730 5780 30220 17.38 24.59 15.13

Yoghurt Kg/D 9615 10830 5178 3083 28706 15.71 14.32 11.86

Cheese Kg/D 80 115 60 47 302

Ghee Kg/D 0 20 0 0 20 0.08 0.30 0.30

Butter Kg/D 244 931 227 238 1640 10.84 17.98 6.39

Cream Lit/D 160 155 120 137 572 34.19 4.45 1.45

Ice-cream Lit/D 1000 1000 0 0 2000 1.52 0.81 0.74

Figure – 5.3.1 clearly depicts the composition of production of local and mini type

dairy processing units of Kabul. Fresh milk and yoghurt as mentioned above are the major

products produced by the processing units. The production of ice-cream is the third important

product for mini processing unit while cream and cheese are the third important products for

local processing units. These quantities of production are very small proportion of estimated

size of different levels of demand for those products with certain exceptions for fresh milk

and cream. But those are not significant. Table – 5.3.1.


Figure - 5 3.1

Composition of Average Production of Dairy Industry

Kabul: Afghanistan

5.3.2 Seasonality in production of dairy industry

Spring and summer are the main production and consumption seasons of dairy

products in Kabul market. A large volume of dairy products, specially yoghurt, are produced

during summer by both types of dairy industry. Figure – 5.3.2.

Figure – 5.3.2

Seasonal variations in Dairy Products, Kabul: Afghanistan

5.4 Price of Milk and Processed Products

The wholesale and retail prices of different dairy products reported by the processors

are presented in Table – 5.4. Except for the prices of yoghurt and cream the difference

between wholesale and retail price is not much different for dairy products. Accordingly, the

retail margin is high for yoghurt (52% in summer and 29% in winter) and cream (21% in

summer and 29% in winter) and low for other products.

Local Units

Fresh Milk

Cheese

Yogurt

Ghee

Butter

Cream

Mini Units

Fresh Milk

Cheese

Yogurt

Butter

Cream

Ice-cream

0%

20%

40%

60%

80%

100%

Local

Winter

Autmn

Summer

Spring0%

20%

40%

60%

80%

100%

Mini

Winter

Autmn

Summer

Spring


Table – 5.4

Wholesale and Retail Price of Some Dairy Products

Kabul: Afghanistan

In Afs

Price Wholesale Price Retail Price Summer

Margin

Winter

Margin

Product/Season Summer Winter Summer Winter % %

Fresh milk Lit 37.14 38.43 41.67 43.20 12.20 12.41

Pasteurized Lit 42.33 42.00 45.00 40.00 6.31 4.76

Yoghurt Kg. 71.85 87.75 109.17 113.00 51.94 28.77

Cheese Kg. 270.00 270.00 275.00 275.00 1.85 1.85

Ghee Kg. 300.00 300.00

Butter Kg. 277.50 235.00 286.67 290.00 3.30 23.40

Cream Lit. 350.00 350.00 425.00 450.00 21.43 28.57


6. SUMMARY, CONCLUSION AND RECOMMENDATION

The Dairy Industry Development in Kabul, Logar and Parwan Province Project”

(UTF/AFG/080/AFG) is jointly implemented by MAIL/FAO/IFAD to achieve the objectives

of the Dairy Development sub-component 2.1 of Livestock and Agriculture Development

Component 2 of CLAP. The Project purpose is to increase dairy milk production and

productivity, and improve dairy milk processing and marketing. To achieve the purpose, the

Project is formulated with four components: a) Strengthening national capacity in dairy cattle

husbandry, dairy processing and marketing at field, district and provincial level; b)

Developing institutional capacity among both public and private institutions; c) Strengthening

the capacity of women in dairy sector; and d) Facilitating the development of enterprise by

setting up a vibrant and dynamic Afghan dairy industry.

The basic objective of this study is to assess the market situations of fresh milk and

dairy products in Kabul markets to examine the possibility of setting up dairy processing

plants - the number and size - that the market can support. Five different levels of

stakeholders of dairy value chain were interviewed in those three target markets in structured

questionnaires for the purpose of this study.

Demand for Fresh Milk and Dairy Products

Population and the present consumption pattern of dairy products as gathered from the

consumers’ survey have been used to estimate the present and future potential demand for

fresh milk and milk products in Kabul market.

Size of the Market:

Urban population of Kabul Province of 2013-14 has been taken to estimate the size of

the market. The total population is used to derive number of urban households taking the

average family size of eight persons. Based on the survey findings the total urban households

have been divided into three groups: a) ‘Non-user’ of 244,066 households (57% of total

household), b) ‘Low user’ of 121,542 households (28.48% of total household), and c) ‘High

user’ of 61,155 households (14.33% of total household). An important happenstance from the

perspective of market size of dairy products is the rapid urbanization of Kabul. There has

been an alarming growth of urban population of Kabul -more than 88% in last decade. Many

new settlements are developing within the municipality with the influx of people from other

Provinces and rapid growth in housing and real-estate business.

General consumer, average consumption:

Two levels of present potential demand and three levels of future potential demand

estimations have been arrived at to assess the size of the Kabul dairy market in terms of total

consumption of milk and milk products.

The first level of present potential demand estimate is based on the average

consumption level of combined ‘users’ group’ households. Each household (of combined low

and high user groups) in Kabul city, on the average, purchases 0.952 Lit./day of pasteurized

milk. Accordingly, the present potential demand for pasteurized milk is estimated at 127,888

Lit./day. Similarly, the demand for yoghurt is about 200,184 Kg./day.


Recommendation 1: To meet the present potential average demand for only two dairy

products (pasteurized milk and yoghurt) of Kabul city processing units of more than 300

Ton/day capacity will be required.

General consumer, users’ group consumption:

The above demand estimation is further refined to derive more realistic picture of

present levels of demand for dairy products by segregating the total consuming households

into ‘low user’ and ‘high user’ groups and applying their respective average consumption of

particular dairy product. The consumers’ survey revealed that only 6% of the total household

(25,606 HH) are high user and 14% are low user (59,747 HH) of pasteurized milk. The high

user group, on the average, consume 1.19 Lit./Day while low user group consumes 0.3

Lit./Day of pasteurized milk. Accordingly, the present potential demand for pasteurized milk

is estimated at 48,395 Lit./Day (30,471 Lit./Day of high user group plus 17,924 Lit./Day of

low user group). Similarly, the demand for yoghurt is about 218,477 Kg./day. Besides,

estimates of present potential demand for selected 12 dairy products that are presently

produced by KDU at Guzargha and private dairies has also been derived.

Recommendation 2: To meet the users’ group present potential demand for only two dairy

products (pasteurized milk and yoghurt) of Kabul market processing units of 267 Ton/day


Recommendation 3: To meet the present potential demand for 12 domestically produced

dairy products of Kabul market multi-purpose processing units of more than 400 Ton/day


All the above present potential demand estimations are on the low side because of two

reasons: a) The estimated urban households excludes ‘other parts of the population’ like rural

population, nomadic population category, daily commuting people and temporarily living

population; b) the estimates are based on the present consumption (demand) level and pattern

which is constrained by many factors. Above all, there are three very good prospects for the

increase in the demand for dairy products in Kabul market: a) the demand for fresh milk and

dairy products is continuously increasing over the years; b) there are shortages in the supply

of different dairy products; and c) the Consumer Price Index reveals that the consumption of

fresh milk and dairy products are very important food item in Afghanistan.

Recommendation 4: From the present potential demand perspectives, multi-purpose dairy

processing units of at least 267 to 400 Ton/day capacity is required to cater the Kabul city

market. The analysis further indicates that there is a definite need for establishing even more

than 400 Ton/day dairy processing capacity.

Institutional consumer:

Different from general consumer is the category of ‘institutional consumer’ who also

add on to the market size of the dairy products. And most discernible among the institutional

consumers is the ‘weeding hall cum catering setup’ which is vastly growing in Kabul city,

and thus, the amount of dairy products used by them. Yoghurt is the single dairy product

which is used by more than 75% of the interviewed institutional consumer.


Recommendation 5: The quantity demanded by the institutional consumers further

reinforces the need for higher than 267 Ton/hour capacity multi-purpose processing units in

Kabul.

Most of the institutional consumers (81% of the respondent) expressed their

willingness and readiness to buy local products. And the conditions they forwarded for

buying are: a) good quality; b) high standard and packing; and c) possibly low price. But 19%

of the respondents are not willing to buy local dairy products mainly because of their

inconveniences. The main inconvenience is their procurement process and the large amount

of particular product which they will like to handle in convenient form.

Recommendation 6: The concerns of the institutional consumers regarding the local dairy

products should be addressed by the dairy processing plants which could encourage them to

buy local dairy products.

Consumers’ basket of dairy products

Four dairy products – yoghurt, all types of processed liquid milk, fresh milk and

pasteurized milk – alone constitute 72% in the total general consumers’ consumption basket.

Yoghurt sold in the bulk is the single most important dairy product that comprises 25% of the

total dairy consumption basket. The quantity demanded and the composition of consumption

basket of institutional consumers is slightly different from the general consumers. Their

consumption basket comprises mostly of imported dairy products like milk powder and UHT

milk. However, yoghurt comprised more than 27% in their consumption basket also.

Recommendation 7: The composition and structure of consumers’ behavior indicate that the

dairy processing industry in Kabul should be structured and organised with emphasis on

production of fresh pasteurized milk and yoghurt. The machineries and facilities of the

processing plants should be tuned to produce, store, handle and sell yoghurt.

Future Potential Demand

Three levels of future potential demand have been estimated: a) low side, b) high side,

and c) very high side potential demand. The low side future potential demand is estimated

with the assumption that the marketing and promotional efforts and other factors will

persuade the low user households to purchase quantity being consumed by high user

household, and the high user group will maintain their present consumption level. The high

side future potential demand is estimated as medium term demand expansion and it includes

the existing estimated demand and the amount that the non-user households will consume the

quantity presently consumed by the low user households. The very high side future potential

demand is estimated as long term demand expansion and it includes the existing estimated

demand and the amount that the non-user households will consume the quantity presently

consumed by the high user households.

Recommendation 8: To meet the future potential demand for dairy products, processing

units of more than 800 Ton/day capacity will be required.

The total future potential demand for dairy products in Kabul is very large and is

expanding with the expansion of the Kabul city. It is already growing very fast and getting

larger and larger. And this sub-sector of dairy industry can provide large employment and


generate substantial profitable economic transactions that can benevolently attract the private

sector investment.

Recommendation 9: The Project should undertake certain activities including the

government’s policy formulation to attract private sector investment in large dairy

processing units to meet the fast growing and large potential future demand for dairy


Share of imports in total existing demand:

A wide range of dairy products are imported into Kabul market by the importer/

wholesaler. The interviewed importers alone are importing to the tune of 243,039 Lit./day of

UHT liquid milk of different brand. Dairy products which are not domestically produced are

imported in large quantity and are sold and distributed in/from Kabul to other markets as

well. Dairy products which are domestically and widely produced are imported in a very

insignificant quantity. Thus, the import market segment is separate and different from the

market segment of domestically produced dairy products. Some traders also confirmed that

there is no competition between the local and imported dairy products in the market because

these products are very different, they cater different needs of the consumers and the target

consumers are also different. The market segments of imported and domestic dairy products

are different and, in general, they are mutually exclusive. Therefore, direct competition

between the two categories of products is absent.

Consumers’ preference – domestic against imported products:

As many as 72% of the consumers preferred local dairy products against the imported

ones because of their being ‘fresh’, ‘natural’ and thus good quality. The consumers’

preference for local products is also reflected in their purchasing behavior. The data indicate

that: a) Some products like UHT liquid milk, flavored liquid milk, certain cheese and all

kinds of milk powder which are not produced domestically, therefore, consumers buy the

imported ones. The competitiveness in the market does not arise for those products. b) In the

case of products which are domestically produced as well as imported, three consumers’

behaviors from the perspective of ‘market competitiveness’ are noticed: i) Certain products

consumers purchase only (virtually) the domestic ones: Ghee, paneer, yoghurt, and

quark/chaka. Those domestic products dominate the market. ii) More consumer tend to buy

local products and in larger quantity than the imported ones like: fresh raw milk, ice-cream

individual pack, and butter milk. Those domestic products maintain very strong competitive

position in the market against imported ones. iii) More consumer tend to buy imported

products than local products but not necessarily in larger quantity than the local ones like:

butter, ice-cream family pack, pasteurized flavored yoghurt in cup and cream. Those

imported products have good competitive position in the market. In general, the present

structure of production and consumption of domestic dairy products in Kabul market do not

indicate serious competition from the imported dairy products.

Traders’ perception on consumers’ preference

A majority of responding traders (wholesaler/importer) expressed that the consumers

tend to prefer imported dairy products because: a) the local products are not easily and

conveniently available; b) imported products are easily available in all season; and c) it is

perceived that the imported products are of good quality, hygienic, safe, and well packed with


appropriate dates clearly mentioned. Some traders also reported that the consumers prefer

local product over the imported ones because the local products are ‘own’ (Afghani)

products. Such consumers’ emotion or attachment is a strong competitive edge for the

domestic products in the market.

Recommendation 10: For enhancing the competitive edge of domestic dairy products

against imported products it is necessary to: a) expand and improve in the ‘physical

distribution system’ of the local dairy products to ensure convenient access to the consumer,

and b) enhance the good quality image of local products in the market.

Processors’ perception on consumers’ preference

On the other hand, a majority of interviewed processors reported that the consumers’

preference for local products as against imported ones is very good while 33% of them even

found it to be excellent. Consumers’ preference for local products is not less than ‘good’.

Majority of the responding processors consider their peers and fresh milk collectors as

competitors rather than the imported products. Few processors feel that the imported dairy

products are also their competitor in Kabul market. But still, a majority of the them are very

sure that their products can compete with imported dairy products. Because, they perceive

that the local products are natural and good quality and the consumers are very willing and

self-encouraged to buy it.

Recommendation 11: Processors of dairy products in Kabul market perceive their peers and

fresh milk collectors as their serious competitor and not the imported dairy products.

Prices of dairy product – consumers’ willingness to pay:

The wholesaler/importers’ margins for different imported dairy products varied from

3.69% (for flavored UHT milk) to 50% (for cheese slice). Only the margin for liquid UHT

milk is recorded to be 96%. The retailers’ margin (difference between importers’ selling price

and price paid by the consumers) for different imported dairy product is very erratic which is

usually the practice in the retail market. They highly varied; ranging from 5.71% for

pasteurized liquid milk to 230.29% for cheese cube. The available information indicate that

the consumers are paying very high price for imported dairy products in Kabul market.

A comparison of average price paid for imported and local dairy products by the

consumers reveals that local products are selling cheaper than the imported products in Kabul

market. Such large price difference between the imported products (comparatively higher)

and local products (comparatively lower) is in favor of local product from competitive

position in the market. But in case of two important dairy products – cream and butter – the

price of local product is higher than that of imported ones.

The consumers wished the price of dairy product would have been less than what they

are paying at present. But price consideration for the consumers is of less importance than

other considerations while buying the dairy products. Most of them are more concerned about

the ‘good quality’ product and ‘good packing’ than the cheap price.

Recommendation 12: The consumers are willing and ready to pay premium price (high

price) for the quality and convenient domestic dairy products.


Recommendation 13: The large price difference between the imported products and local

products is in favor of domestic product from the competitive position in the market and this

should be maintained by the processing units to attract the consumers.

Supply of Fresh Milk

The population of milking cow of three different breeds (local, cross and exotic breed)

in three Project districts (Dehsabz, Char Asiab and Qarabagh) and their average yield per

day/cow derived from the farmers’ interviews have been used to derive total milk production.

Based on those indicators, the estimated present milk production of three districts of Kabul is

97,970 Lit./day of which 57% will be available during summer and 43% during winter.

Marketable and Marketed surplus

The ‘marketable surplus’ of fresh milk of the farmer on the average is 79.52% of total

production. The remaining 20.48% is consumed by the farm family. But their ‘marketed

surplus’ of fresh milk is estimated at 64.43% of total production.

The marketable surplus of milk in three Project districts is estimated to be 77,905

Lit./day and ‘marketed surplus’ is 63,122 Lit./day. This amount will be sufficient to operate a

multi-purpose dairy processing unit of only 60 to 70 Ton/day capacity. Both of these amounts

will not be sufficient for the dairy processing units that is required to meet the present low

side users’ potential demand for fresh milk and other dairy products of Kabul market.

A large number of farmers/producers are supplying 856 Lit./day of fresh milk to

Kabul market – about 41% of the total interviewed farmers. And more than 70% of the

respondents are selling dairy products (other than the fresh milk) in Kabul and other near-by

markets to the shops and/or directly to the consumers. They are selling substantial quantity of

yoghurt – more than 7,023 Kg./week. Besides, some of them are also selling butter – about

147 Kg./week. Farmers are selling their products in Kabul market without problem. Only

16% of the interviewed farmers reported transportation as a constraint for selling their milk to

Kabul. The survey reveals that the small farmers are harnessing the opportunities created by

the large and expanding demand for milk products in Kabul city and profitably.

Recommendation 14: Efforts and programme to increase milk supply by the farm household

needs to be expanded and intensified. The expected results of the Project to increase

marketable milk to 7 Lit./day/HH will not be sufficient to meet the required fresh milk of the

above postulated processing units.

Recommendation 15: Collection of milk for the processing units needs to be increased by:

a) increasing the number of collection centres in Kabul; b) collecting and transporting milk

from other Provinces to Kabul.

Recommendation 16: Establish a fleet of milk transporting refrigerated van/trucks.

Dairy Processing Industry of Kabul

The dairy processing industry of Kabul is still quite traditional. This industry is

comprised of three sub-sectors in terms of nature and volume of the processing units. The

discernible sub-sector is a large number of small household level ‘local’ processing unit with


average processing capacity of 323 Lit./day. The second category is a small sub-sector

comprised of so called ‘mini’ dairy unit with average plant capacity of 1,511 Lit./day. The

combined total processing capacity of all those surveyed units is 16,182 Lit./day. Assuming

that the survey covered only 40% of such existing dairy processing unit, then the total

installed processing capacity is estimated at 40,455 Lit./day. Lastly, there is a moderately

organised large units with improved technology processing more than 1000 Lit./day to 5,000

Lit./day. This sub-sector is very small with only seven units but with combined processing

capacity of 12,400 Lit./day. Many processing units of the dairy industry are not operating at

its full installed capacity. The mini type units are utilizing 81% of their capacity. But the local

type units are operating at more than their rated capacity.

It is estimated that the total demand for fresh milk of all local and mini dairy

processing units is 40,455 Lit./day. The moderately organised seven units have the total

demand for 12,400 Lit./day. Thus, the present demand for fresh milk of the dairy processing

industry of Kabul is 52,855 Lit./day. The fresh milk and yoghurt are two most important

products sold by both local and mini type processing units.

The estimated processing capacity of the existing dairy industry (52 Ton/day) is about

17.33% of the processing capacity required to meet the present average potential demand for

pasteurized milk and yoghurt (300 Ton/day) of Kabul. On the other, it amounts to about

19.48% of the processing capacity required to meet the present potential users’ side demand

(267 Ton/day) for those two products only. There is a shortage of about 215 Ton/day

processing capacity.

Recommendation 17: There is a large gap between the existing installed processing

capacity of dairy industry and the required processing capacity to meet the estimated

different levels of consumers’ demand for dairy products in Kabul. Therefore, strategies and

efforts should be undertaken to add on to the processing capacity of dairy industry of Kabul.

Many processing units of the dairy industry are not operating at its full installed

capacity. The main constraint for the dairy industry is reported to be the insufficient supply of

electricity and transportation. Some mini type unit reported that their constraint is the old

technology and machineries of their units. Both types of units are collecting milk from

outside of Kabul district as well at the average distance of about 25-26 Km.


Bibliography

1. Prefeasibility Study on Nangarhar Dairy Value Chain, produced by Roots of Peace

under the ADB Rural Business Support Program, (JFPR 9100‐AFG), Afghanistan,

May 2008.

2. Nangarhar Dairy Market Survey and Assessment Conducted in Collaboration with the

Alternative Livelihoods Project – East (ALP-E) by Land O’Lakes, Inc. June 2006.

3. Dairy Production and Processing Feasibility Study Helmand and Kandahar Provinces,

Afghanistan, Alternative Livelihood Program/ Southern Region, produced for review

by the United States Agency for International Development, prepared by Chemonics

International Inc. January 2006.

4. Study on Dairy Production and Processing in Afghanistan, Horticulture and Livestock

Project/HLP, Ministry of Agriculture, Irrigation and Livestock/MAIL, Afghanistan

June 2007.

5. Dairy Market Surveys in Kabul, Alternative Agricultural Livelihood Programme,

Afghanistan, FAO/DIFID, GCP/AFG/036/UK, Project discussion paper 21, August

2007.

6. Dairy Market Chain, Alternative Agricultural Livelihood Programme, Afghanistan,

FAO/DIFID, GCP/AFG/036/UK, Project discussion paper 28, August 2007.

7. Development of Integrated Dairy Schemes in Nangarhar Province,

UTF/AFG/060/AFG, Project Agreement.


UTF/AFG/060/AFG, Project Progress Report, July-September 2010.


UTF/AFG/060/AFG, Fact Sheet, February 2011.

10. Sensitizing Research and Program Activity in Afghanistan Livestock’s Sector,

prepared by Mesbah Motamed, GL-CRSP, May 2008.

11. Kabul Dairy Markets, Alternative Livelihoods Programme, DFID/AALP/FAO,

August 2007.

12. Commercial Viability of Balkh Dairy, Alternative Livelihoods Programme,

DFID/AALP/FAO, August 2007.

13. The Organisation of Dairy Market Chain in Afghanistan, Alternative Livelihoods

Programme, DFID/AALP/FAO, August 2007.

14. Dairy as a Possible Livelihood Alternative to Opium Production, Alternative

Livelihoods Programme, DFID/AALP/FAO, August 2007.

15. Work plan of Development of Integrated Dairy Schemes in Afghanistan,

GCP/AFG/040/GER, Jan – December 2009.

16. Afghanistan Statistical Year Book, Central Statistics Organization, Islamic Republic

of Afghanistan, Different Issues.

17. Dairy Industry Development in Kabul, Logar and Parwan province, UTF/AFG

/080/AFG), Government of the Islamic Republic of Afghanistan, International Fund

for Agricultural Development (IFAD) and FAO/UN.

18. Inception Report, Facilitating Partner to Support the Dairy Production Component of

HLP, GRM International Pty Ltd Australia, June-November 2009.

19. Dairy Market Survey in Kabul, Discussion Paper No. 27, Alternative Agriculture

Livelihood Programme Afghanistan, GCP/AFG/036/UK, DFID/FAO/UN, August

2009.

20. The Role of Dairy Development in Counter Narcotics Strategies, Discussion Paper

No. 29, Alternative Agriculture Livelihood Programme Afghanistan,

GCP/AFG/036/UK, DFID/FAO/UN, August 2007.


Annex – 2.2

Staff Participants in Data Collection Training

S.N Name Office Contact

Number

1 Mr. Matiullah, DAIL/Kabul 0799246353

2 Mr. Zekrullah DAIL/Kabul 0707790230

3 Mr. Bashir Ahmad DAIL/Kabul 0774901450

4 Mr. Naqibullah DAIL/Kabul 0708715647

5 Mr. Shamsulrahman Kabul Dairy Union 0788957951

6 Mr. Khir M Kabul Dairy Union 0700650280

7 Mr. Faridullah DAIL/Kabul 0700476911

8 Mr. Sha Mohammad DAIL/Kabul

9 Mr. Abdul Karim DAIL/Kabul/Deh Sabz 0700380592

10 Mr. Mohammad Aref Livestock Director

11 M. Taib Safi RMLSP/MAIL 0770201936

12 Mr. Najmuddin, DAIL/Parwan 0799112703

13 Mr. Abdul Wahid DAIL/Parwan 0786156069

14 Mr. M. Malang DAIL/Parwan 0777918866

15 Mr. Abdul Qahar DAIL/Parwan 0770001958

16 Mr. Abdul wajed DAIL/Parwan 0776611647

17 Mr. Karimullah DAIL/Logar 0799003251

18 Mr. Mahmmod DAIL/Logar 0778972054

19 Mr. Atiqullah DAIL/Logar 0798231762

20 Mr. Bashir Ahmad DAIL/Logar 0799637250

21 Mr. Mustafa DAIL/Logar 0700147969

22 Mr. M. Roshan DAIL/Logar 0784273690

23 Mr. Safiullah DAIL/Logar 0771259214

24 Ms. Shahzar Zadran CLAP/MAIL 0799145972

25 Mr. Hamidullah Momand E&M/CLAP/RMLSP 0785963600

26 Dr. Ramesh Munankami FAO/International Consultant

27 Dr. Lutfullah Rlung FAO/National Professional Staff 0700503980

28 Mr. Abdul Hakim Hakimy FAO/National Consultant 0700037521

29 Mr. F. Hamid Salimee FAO/National Dairy Industry Officer 0704995596

tel:%2B93-0700503980


Annex – 2.2.A

Number of Respondents for Baseline and Dairy Market Study

Province/District Farmers Consumer Processor Wholesaler/

Importer

Institutional

consumer

1. Kabul 137 63 23 19 51

2. Parwan 140 28 4 10 10

3. Logar 147 9 4 9 6

Total 424 100 31 38 67

Field Survey and Data Management Team for Baseline and Dairy Market Study

Surveyor Office Surveyor Office

KABUL

PROVINCE

PARWAN

PROVINCE

1. Mr. Matiullah,

Team Leader

DAIL Kabul 1. Mr. Najmuddin,

Team Leader

DAIL Parwan

Parw

2. Mr. Zekrullah Livestock

Department

2. Mr. Abdul Wahid Veterinary Field Unit,

Parwan

3. Mr. Bashir Ahmad Livestock

Department

3. Mr. M. Malang Veterinary Field Unit,

Parwan

4. Mr. Naqibullah 4. Mr. Abdul Qahar Veterinary Field Unit,

Parwan

5. Mr.

Shamsulrahman

Kabul Dairy 5. Mr. Abdul Wajed Veterinary Field Unit,

Parwan

6. Mr. Khir M Kabul Dairy

7. Mr. Faridullah Veterinary Field

Unit, Kabul LOGAR

PROVINCE

8. Mr. Sha

Mohammad

Veterinary Field

Unit, Kabul

Mr. Karimullah,

Team Leader

DAIL Logar

9. Mr. Abdul Karim Veterinary Field

Unit, Kabul

2. Mr. Mahmmod Veterinary Field Unit, Logar

10. Mr. Zaki Veterinary Field

Unit, Kabul

3. Mr. Atiqullah Veterinary Field Unit, Logar

11. Mr. Shafiq Veterinary Field

Unit, Kabul

4. Mr. Bashir

Ahmad

Veterinary Field Unit, Logar

12. Mr. Veterinary Field

Unit, Kabul

5. Mr. Mustafa Veterinary Field Unit, Logar


Unit, Kabul

6. Mr. M. Roshan Veterinary Field Unit, Logar


Unit, Kabul

7. Mr. Safiullah Veterinary Field Unit, Logar

CLAP/MAIL Intern Kabul Dairy

Union

Project Staff

1. Ms. Fariha Safi 1. Dr. Lutfullah

Rlung

2. Ms. Lina

Mohammady

2. Mr. Shamsulhaq

Ahmadi

3. Ms. Sunaia Sareer 3. Mr. Salimee

4. Mr. Hakimy


Annex – 3.1.1

Total Urban and Rural Population in Kabul Province6

Figures in’000

Total Urban Rural

KABUL Year Female Male Both sex Female Male Both sex Female Male Both sex

Provincial Total 2004-05 1457.1 1556.1 3013.2 1183 1269.3 2452.3 274.1 286.8 560.9

Kabul only 1174.9 1260.5 2435.4 1174.9 1260.5 2435.4

ـ ـ

Provincial Total 2005-06 1485.3 1586.3 3071.6 1205.9 1293.9 2499.8 279.4 292.4 571.8

Kabul only 1197.7 1284.9 2482.6 1197.7 1284.9 2482.6

Provincial Total 2006-07 1517.5 1620.6 3138.1 1232 1321.9 2553.9 285.5 298.7 584.2

Kabul only 1223.6 1312.7 2536.3 1223.6 1312.7 2536.3 - - -


Kabul only 1315.8 1411.6 2727.4 1315.8 1411.6 2727.4

ـ ـ

Provincial Total 2008-09 1667.9 1781.9 3449.8 1374.8 1475.2 2850 293.1 306.7 599.8

Kabul only 1365.9 1465.5 2831.4 1365.9 1465.5 2831.4

ــ ــ

Provincial Total 2009-10 1725.3 1843.2 3568.5 1427.3 1531.4 2958.7 298 311.8 609.8

Kabul only 1418.2 1521.5 2939.7 1418.2 1521.5 2939.7

ــــ ــــ

Provincial Total 2010-11 1784.7 1906.7 3691.4 1481.7 1589.7 3071.4 303 317 620

Kabul only 1472.4 1579.6 3052 1472.4 1579.6 3052


Kabul only 1528.5 1639.9 3168.4 1528.5 1639.9 3168.4

- -


Kabul only 1586.7 1702.3 3289 1586.7 1702.3 3289 - - -


Kabul only 1647.1 1767.0 3414.1 1647.1 1767.0 3414.1

6 Afghanistan Statistical Year Book 2013-14, Central Statistics Organization, Islamic Republic of Afghanistan, http://cso.gov.af/en/page/demography-and-socile-

statistics/demograph-statistics/3897




Annex – 3.1.2

Different Level of Dairy Product Users – Consumer

Kabul: Afghanistan

Proportion of Respondent

Dairy Product Non user Low user High user

Fresh raw milk 64 18 18

Plain liquid milk (pasteu) 80 14 6

Plain liquid milk-UHT 24 43 33

Milk Powder (whole) 67 12 20

Milk powder (skim) 68 17 15

Flavored liquid milk (pasteu) 95 5 0

Flavored liquid milk-UHT 87 11 2

Butter 64 31 5

Ghee 88 12 0

Cheese cubes 41 47 12

Cheese slices 89 9 2

Gouda cheese 95 5 0

Cream cheese 48 41 11

Paneer 54 37 9

Ice cream (individual

pack/bar 21 44 35

Ice cream (family pack) 73 27 0

Local Bulk Yoghurt 10 27 63

Pasteurized Yoghurt/cup 46 42 13

Cream 41 50 9

Butter Milk 23 42 36

Quark/Chaka 24 64 12

Other product

Average 57.19 28.48 14.33


Annex - 3.1.2.A

Different Category of Household and Average Consumption

Kabul: Afghanistan

Municipality

Proportion of

Respondent

Estimated Household

(Total 426,763)

Average

Consumption

/HH in Qt

Dairy

Product

Unit

No

nu

ser

Lo

w u

ser

Hig

h u

ser Non-

user

HH

Low

user

HH

High

user

HH

Low

user

Qt

High

user

Qt

Fresh raw

milk

Lit/

day

64 18 18

273,128 76,817 76,817 0.3 1.3

Plain liquid

milk

(pasteurized)

Lit/

day

80 14 6

341,410 59,747 25,606 0.3 1.19

Plain liquid

milk-UHT

Lit/

day

24 43 33

102,423 183,508 140,832 0.3 1.5

Milk Powder

(whole)

Kg/

day

67 12 20

285,931 51,212 85,353 0.05 0.14

Milk powder

(skim)

Kg/

day

68 17 15

290,199 72,550 64,014 0.054 0.14

Flavored

liquid milk

(pasteurized)

Lit/

day

95 5 0

405,425 21,338 0 0.082 0

Flavored

liquid milk-

UHT

Lit/

day

87 11 2

371,284 46,944 8,535 0.042 0.11

Butter Kg/

day

64 31 5

273,128 132,297 21,338 0.042 0.167

Ghee Kg/

day

88 12 0

375,551 51,212 0 0.14 0.143

Cheese cubes Kg/

day

41 47 12

174,973 200,579 51,212 0.03 0.089

Cheese slices Kg/

day

89 9 2

379,819 38,409 8,535 0.071 0.142

Gouda cheese Kg/

day

95 5 0

405,425 21,338 0 0 0

Cream cheese Kg/

day

48 41 11

204,846 174,973 46,944 0.031 0.073

Paneer Kg/

day

54 37 9

230,452 157,902 38,409 0.052 0.159

Ice cream

(individual

pack/bar

Pack/

day

21 44 35

89,620 187,776 149,367 0.68 0.80

Ice cream

(family pack)

Pack/

day

73 27 0

311,537 115,226 0 0.186 0

Local Bulk

Yoghurt

Kg/

day

10 27 63

42,676 115,226 268,861 0.27 0.63


Pasteurized

Yoghurt/cup

Kg/

day 46 42 13 196,311 179,240 55,479 0.057 0.14

Cream Kg/

day

41 50 9

174,973 213,382 38,409 0.032 0.157

Butter Milk Lit/

day

23 42 36

98,155 179,240 153,635 0.10 0.50

Quark/Chaka Kg/

day

24 64 12

102,423 273,128 51,212 0.071 0.171

Average 57.19 28.48 14.33 244,066 121,542 61,155


Annex – 3.2.1

Estimated Present Potential Average Demand for Dairy Products

Kabul: Afghanistan

No Dairy products

Unit/

Day

Average

consumption

/HH

Estimated

# of

consuming

household

Total

Average

consumption

1 Fresh raw milk Lit/D 0.952 182,697 173,928

2

Plain liquid milk

(pasteurized) Lit/D 0.7

182,697

127,888

3 Plain liquid milk – UHT Lit/D 0.89 182,697 162,600

4 Milk powder - whole Kg/D 0.09 182,697 16,442

5 Milk powder – skim Kg/D 0.0875 182,697 15,986

6

Flavored liquid milk-

pasteurized Lit/D 0.057

182,697

10,439

7 Flavored liquid milk - UHT Lit/D 0.078 182,697 14,355

8 Butter Kg/D 0.083 182,697 15,130

9 Ghee Kg/D 0.14 182,697 25,578

10 Cheese cubes Kg/D 0.046 182,697 8,430

11 Cheese slices Kg/D 0.126 182,697 22,968

12 Cream cheese Kg/D 0.046 182,697 8,404

13 Paneer Kg/D 0.113 182,697 20,671

14 Ice cream individual pack Pack/D 0.72 182,697 131,542

15 Ice cream family pack Pack/d 0.36 182,697 65,771

16 Local bulk yoghurt Kg/D 1.00 182,697 182,697

17 Pasteurized yoghurt/ cup Kg/D 0.096 182,697 17,487

18 Cream Kg/D 0.064 182,697 1,673

19 Butter milk Lit/D 1.40 182,697 255,776

20 Quark/ Chaka Kg/D 0.127 182,697 23,229


Annex - 3.2.2

Estimated Present Users’ and Future Potential Demand for Dairy Products

Kabul: Afghanistan

7 In case of certain products the potential low side demand is larger than potential high side demand due to: number of low

user group household and average consumption is larger than high user group household.

Demand

Present Potential Users’

Demand

Future Potential Low side

Demand7

Future

Potential

High side

Demand

Future

Potential

Very

High side

Demand

Dairy Product Unit LhxLq HhxHq Total

X1

LhxHq HhxHq Total NhxLq +X1 NhxHq+ X

1

Fresh raw milk Lit/

day 23,045 99,862 122,907 99,862 99,862 199,724 203,566 472,427

Plain liquid

milk (pasteu)

Lit/

day 17,924 28,167 46,091 65,722 28,167 93,888 148,514 421,642

Plain liquid

milk-UHT

Lit/

day 55,052 211,248 266,300 275,262 211,248 486,510 297,027 419,935

Milk Powder

(whole)

Kg/

day 2,561 11,949 14,510 7,170 11,949 19,119 28,807 54,540

Milk powder

(skim)

Kg/

day 3,918 8,962 12,880 10,157 8,962 19,119 28,550 53,508

Flavored liquid

milk (pasteu)

Lit/

day 1,750 0 1,750 1,750 0 1,750 34,995 34,995

Flavored liquid

milk-UHT

Lit/

day 1,972 939 2,910 5,164 939 6,103 18,504 43,752

Butter Kg/

day 5,556 3,563 9,120 22,094 3,563 25,657 20,591 54,732

Ghee Kg/

day 7,272 0 7,272 7,272 0 7,272 60,600 60,600

Cheese cubes Kg/

day 6,017 4,097 10,114 16,046 4,097 20,143 15,364 24,112

Cheese slices Kg/

day 2,727 1,212 3,939 5,454 1,212 6,666 30,906 57,873

Gouda cheese Kg/

day 0 0 0 0 0 0 0 0

Cream cheese Kg/

day 5,424 3,427 8,851 12,773 3,427 16,200 15,201 23,805

Paneer Kg/

day 8,211 6,107 14,318 25,106 6,107 31,213 26,301 50,960

Ice cream

(individual

pack/bar

Pack

/day

127,688 119,493 247,181 150,221 119,493 269,714 308,123 318,877

Ice cream

(family pack)

Pack

/day 149,794 0 149,794 149,794 0 149,794 207,740 207,740

Local Bulk

Yoghurt

Kg/

day 31,111 169,382 200,493 72,592 169,382 241,974 212,015 227,379


Notes: Lh = Low user household; Lq = Low user quantity; Hh = High user household; Hq =

High user quantity; Nh = Non-user household.

Pasteurized

Yoghurt/cup

Kg/

day 10,217 7,767 17,984 25,094 7,767 32,861 29,173 45,467

Cream Kg/

day 6,828 6,030 12,858 33,501 6,030 39,531 18,458 40,329

Butter Milk Lit/

day 17,924 76,818 94,742 89,620 76,818 166,438 104,540 143,820

Quark/Chaka Kg/

day 19,392 8,757 28,149 46,705 8,757 55,462 35,421 45,664

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