Benefits to Nepal
Nepal Information:
Nepal is a country that is located on the continent of Asia in between two major world leaders, China and India making it a land locked country (World Atlas 2016). Nepal has a population size of twenty-eight million people, which is similar in population to that of Canada with a land mass that is much smaller, covering an area of 147,141 kilometers squared (Chapagain, 2016). Nepal is a very poor country with a gross domestic product per capita of around eight hundred eighty-seven Canadian dollars (Trading Economics, 2015), or around seventy-one thousand eight hundred sixty-nine Nepalese rupees (Bank of Canada).
Thirty-eight percent of the aforementioned gross domestic product per capita comes from the agriculture sector of Nepal. This industry employs over seventy percent of the population making this industry the most important in Nepal (Chapagain, 2016).
As seen in figure four Nepal is divided geographically into three main regions (Info Nepal, 2011). The first region of Nepal is the mountain region which contributes to about thirty-five percent of Nepal’s land mass (Chapagain, 2016). The main purpose or use of this region is for agriculture related reasons and is mostly comprised of cattle and small animal grazing during the summer months (US Aid, 2016). These cattle are moved to the lower grass plains in the winter months (Chapagain, 2016). The reason that there is minimal crop development is that the growing season is short due to the cold temperatures and the soil of this region is mostly comprised of rocks and sand. (Nations Encyclopedia, 2010).
Next region located in the middle of the trapezoidal shaped country is the flatlands and hills region. Growing crops in this region is challenging though due to the terrain, which is comprised of very steep slopes (US Aid, 2016). To combat the steep slopes of the land the local farmers have made terraces, on which they grow crops such as maize and millet are grown (US Library of Congress).
Other crops grown in this area are fruits such as apples, as well as, coffee and some select vegetables (Chapagain, 2016). Many varieties of crops are grown here due to its warmer sub-tropical climate (US Aid, 2016). The Flatlands and Hills region also supports the production of cattle and goats because of the larger grazing areas which are available all year round (Nations Encyclopedia, 2010). These livestock are often used for milk production, working the land and for the consumption of meat (Chapagain, 2016).
The last and lowest region in Nepal would be the Terai region. The soil type in this region is a highly abundant in nutrient value due to the fine granular properties brought by the water in the flood plains (Chapagain, 2016). This region is home to very flat land that is good for larger scale rice production with the use of mechanized equipment (Info Nepal, 2011). This land also grows a variety of tropical fruits and fresh vegetables. The tropical climate in this region is not very good for grazing livestock, so animals are fed the leftover organic matter from crops (Chapagain, 2016).
From the information given above, Nepal is a very poor and food deficient country and would benefit greatly from products that would increase yields, while also maintaining a low cost for the production. For this project I will be focusing on a large industry of dairy cattle farming in Nepal, which annually produces around one million six hundred twenty-two thousand (1,622,000) metric tons of milk (FAO, 2010).
Need for Optivia Milk Replacer:
Nepalese farms with dairy cattle as their primary producers are often producing milk for self-sustenance of the herd and for personal use. The goal of introducing Optivia milk replacer to dairy farming in Nepal would in general to improve the health and longevity of the cattle, as well as, to increase the production of milk for personal use and a surplus of product for market sales for public consumption.
With the average twenty-five kilogram bag of Optivia milk replacer feeding one calf until being weaned, or until eight weeks (D. Matheson, personal communications, November 18, 2016) ), this would add fifty-two hundred Nepalese rupees to the cost of raising one calf. The addition of this product would allow the farmer to add almost eight weeks of milk production for processing or sales as opposed to allowing the calf to nurse off the mother (G. Matheson, personal communication, November 18, 2016).
The average milk production of a Nepalese dairy cow is around one thousand two hundred fifty-five litres per lactation (FAO, 2010) and the average price per litre of milk in Nepal being sixty-seven rupees (Numbeo, 2016). The addition of the eight weeks of milk that could be processed and sold would amount to approximately fifteen thousand four hundred thirty-eight rupees. Subtract the fifty-two hundred rupees for the milk replacer and the farmer has the potential to profit around ten thousand rupees to their income per cow being milked. As stated above in the earlier paragraph Labour and Cost of Product there is almost no added cost that come after purchasing the product, but also not a lot is added to labour of the farmer’s busy schedule.
Benefits:
For a small scale subsistence farmer, the added income of using this product would benefit in them in many ways. Not only would they benefit the farmer’s dairy operations, but the farmer would also be able to share the benefits with his family with the additional income from the sale of the surplus milk. The extra money could be used to pay off any farming or personal debts, pay for medical supplies and even send kids to school to become further educated, which they could then bring back their knowledge to assist with further development of the farm.
For the larger scale commercial dairy farmers in Nepal the extra income would allow them to keep expanding their business. In turn, more and more income would be generated by the farmer as the farm expands. With expansion of the farm more employees would be needed to manage the dairy and cattle, thereby helping to decrease the forty-six percent unemployment rate (United Nations, 2008). Overall this product would have many direct and also indirect positive benefits to the Nepalese people.
Logistics:
The transportation of this of Optivia milk replacer is very challenging. As mentioned in the previous section Nepal Information it is a land locked country (Chapagain, 2016) meaning there is no direct route from Canadian ports to Nepal. The product would start its journey at one of the Canadian Nutreco plants or a retail store mentioned previously, Yantzi’s Feed and SeedLimited in Southwestern Ontario. From this location it would be shipped by truck to the Vancouver port, the cost of this would be around twelve hundred Canadian dollars (Brian Kurtz Trucking Ltd, personal communication, Novemeber 27, 2016). The next step is to ship the product to Asia in a forty-foot shipping container, by boat, to the port of Haldia, India. The price of this journey would be around eight hundred Canadian dollars (Government of Canada, 2010). From Haldia the product would be shipped across the country to Nepal to its final destination in the capital city of Kathmandu. The milk replacer may be distributed from there to local retailer farmers’ cooperative or directly to the farmers. The entire cost of this process would add around ninety Nepalese rupees to cost of one bag of Optivia milk replacer based on two thousand bags being shipped in each container.
Competitors:
Optivia milk replacer with its acid quality’s allows the farmer to have the convenience of allowing the milk to not be refrigerated for longer than normal times (Tarr). If a Nepalese farmer liked the fact of the convince of this product another option would be to add citric acid to whole milk to achieve a lower pH. This option would be substantially cheaper for a poor dairy farmer in Nepal. The cost of one twenty-five kilo bag of citric acid is around eighty-two Canadian dollars (Suffire Blue, 2016) or, 6700 Nepalese rupees. This would only have to be added to milk in minute amounts (D. Berg, personal communication, November 16, 2016).
But in only using citric acid to adjust the pH of the whole milk is that you would still need the milk from the cow. This would be counterproductive from using Optivia milk replacer because the milk would not be able to be processed and handled to be sold commercially.
Figure 4: Three Main Regions in Nepal (Info Nepal, 2014)
(Biodiversity International,2014)