What happens there touches us here (continued)

In the last edition of our newsletter, we published a story under this title and have received comments and questions arising from the content of the story. What follows now is an attempt to respond to some of these questions within the limits of the available space. Some of the questions raised include: can this powdered milk be found on the European markets? If not, why doesn’t it exist there too? Where is it produced? How is this mixture used to replenish the skimmed milk? These questions are in line with another question asked by a breeder from Burkina Faso who said: “Are these exported products also consumed in Europe; are there no regions in Europe that produce only for Africa”. Please click here to read the original article.

West Africa is a very dynamic dairy consumption area. Even if milk consumption is still low, it is increasing significantly.[1] With an estimated total population of 382.5 million in 2018; about 60% of the working population make their living from livestock and agriculture. In the Sahel region (Niger, Chad, Mali, Burkina Faso, Mauritania, and Senegal), pastoralism and agro-pastoralism are a pillar of the economy. Growing urbanization is increasing the demand for cheap dairy products for the poor and more refined products for the developing middle class. However, the development of local milk production faces substantial challenges, among others: the low milk productivity of livestock farms because it is difficult to feed livestock properly all year round; the inability of livestock farmers to increase their capital; the lack of sufficient and adequate infrastructure for the proper transport of milk to the dairy; the lack of health care supervision of herds… Faced with these challenges, the population’s demand for dairy products is now largely met by increasing imports of milk powder, particularly from the European Union (EU), reconditioned or processed on site by European dairy companies. In the city of Bamako, for example, 90% of the milk consumed comes from powder.[2]

The EU stopped regulating its milk production in 2015, resulting in a milk increase of more than 157 million tons in 2018. As a result, milk supply exceeded demand and prices fell, as did the income of European farmers who were forced to sell their milk to manufacturers at low prices. At the same time, world demand for butter has risen sharply and so has its price. Industrialists took the opportunity to extract butterfat from milk and make it into butter sold at high prices. As a result, they ended up with large quantities of skimmed milk processed into powder for storage. But the problem was how to get outlet for it. To replace animal fat, this powder is replenished with palm oil (MGV blend) at a much lower cost than butter. This false milk is then exported to West Africa where it is sold at a lower price than local milk. Falsely labelled, this substitute may be confused with real milk but without the nutritional qualities and this can be harmful to health.[3] Most often imported in the form of 25 kg bags, this product benefits from the very low common external tariff (CET) of 5% common to ECOWAS, whether for milk powder or MGV blend. These large bag packages are used for processing and repackaging on site in smaller packages, then often in micro-pods very cheap for the consumer. This type of milk is not found in European shops. At least some of the big and well known super markets of Belgium like Delhaize and Carrefour, the only powder milk in big quantities is the one for children but good selections. The only common milk powder found in many shops is NIDO and it is always expensive. A response is yet to be found why that so called re-fattened milk blend should be produced only for Africans?

In 2018, milk powder exports to West Africa accounted for only a small share and had fallen from 9.7% in 2016 to 7.9% in 2018 while the MGV blend increased from 29% in 2016 to 35% in 2018. In the same year, total EU exports of milk powders and MGV blends represented a cost of €685.3 million for West Africa. Many dairy firms from the European Union have settled in West Africa: Lactalis, Sodiaal and Danone (France), Arla Foods (Denmark), Nestlé (Switzerland), Friesland-Campina (Netherlands), DMK (Germany), Glanbia (Ireland), Milcobel (Belgium). This choice is strategic: West Africa is a market of the future, given its demographic boom, its low local milk productivity and the population’s need for it. These multinationals therefore want to place themselves in a good position compared to competing firms in Europe or other continents. The largest share of exports to ECOWAS comes from the Netherlands, Poland, Belgium and France. Most of the investments consist of refurbishing factories for milk powder produced in their factories in Europe, thus bypassing the taxation applied on small packages, whereas these locally refurbished bags compete as much with local liquid milk as powder boxes from Europe. In 2013, for example, Danone took control of Fan Milk International in Nigeria, a milk distribution company present in 5 West African countries, with more than 80% of the market in Nigeria and Ghana. Arla continues to expand in several countries: in 2017, it set up a factory in Ghana, creating only 8 jobs there.

An increasing number of companies, under pressure from West African States wishing to promote local production, concerned about their image of “social responsibility”, and also to produce certain typical local products more easily, are partnering with local dairies and processing both local milk and imported powder. This is the case, to cite only a few examples, of Danone in Senegal (Laiterie du Berger) and Friesland Campina in Nigeria (Wamco). This interest in local milk is growing, but it still concerns only 20% of companies, which collect only very little local milk, i.e. about 30,000 litres (20% of the capacities of the Berger dairy, 0.4% of that of Wamco, 1.3% for Eurolait-Sodiaal in Mali, etc.)[4]

The European productionist model is pushed to the extreme for the benefit of industrialists and to the detriment of livestock farmers in the north and south, the environment and consumer health. While its domestic consumption is stagnating, the EU is thus choosing to focus more and more on the global market. It plans to increase its milk production by 0.8% per year until 2030, when it would produce 182 million tons, 25% of which will be exported. With export growth of 2% per year, it could cover 35% of world demand in 2019-2030. However, it must be borne in mind that by continuing to crush an economy that is struggling to develop in Africa, Europe cannot claim to be supporting the development of Africa. A fair relationship between Africa and Europe is urgently needed. As the European Commission President Jean-Claude Juncker said, “What happens in Africa is important for Europe and what happens in Europe is important for Africa. Our partnership is an investment in our common future. It is a partnership of equals, in which we support each other to create prosperity and make the planet a safer, more stable and sustainable place to live.”[5]