Oromia regional state shares 44 % of the national livestock population. The region has about 22.5 million cattle, 9.1 million sheep. 7.4 million Goats, 1.2 million horses, 185,000 Mules, 2.4 million donkeys and 255.000 camels, 14 million poultry and 2.8 million beehives (CSA, 2013).

The region is also the leading milk producer in Ethiopia with annual production of 1.4 billion liters. This accounts for over 40% of the national milk production. More than 95% of the milk produced in the region comes from smallholder farmers but there are also several commercial milk producing belts. The leading commercial milk producing zones within the region are North Showa, East Shewa, Arsi, West Shewa and Oromia Special Zone Surrounding Finfinnee. The region offers tangible business opportunity for international investors aiming the dairy sector. Though many corridors within the region are suitable for dairy investment, Adama-Bishoftu including the Arsi highland, Selale-Fitche and West Showa corridors stand-out (Hands-ON Investment Guide-Oromia.2015).

The Adama-Bishoftu-Assela corridor includes areas in East Showa, Arsi, parts of West Arsi and Oromia Special zone. It currently hosts several dairy farms and processing companies such as Holland dairy, Alema, Genesis, and Alfa Farms and Agro Industries. The agro-ecology of the area is suitable for green feed and good access to water.

Selale-Fitche (North Shewa) corridor includes North Showa and parts of Oromia Special Zone. It is the leading commercial milk supplier to Finfinnee. The agro-climate is predominantly highland. Most milk processing companies based in Finfinnee and surrounding. Oromia Special zone sources milk from this corridor. Selale-Fitche corridor offers tangible business opportunity in milk processing as well as large-scale commercial dairy farming. Alike the Adama-Bishoftu corridor it is close to Finfinnee, which is the main market.

West Showa corridor includes areas in west Showa zone, parts of Oromia Special zone and other surrounding zones of Horro Guduru and East Wellega. The agro-climate is a mix of highland and midland. Horo, one of the most productive local breed in Ethiopia, are found in this area. The West Showa corridor offers strong opportunity in milk production and processing. The area has good access to feed where greed feed is readily available.

Borena-Guji Corridor refers to the lowland parts of South East Oromia. The agro-climate of the region is arid and semi-arid. It is mostly pastoralist based agriculture. Borena breed is one of the most prominent local breed in terms of milk productivity. The Borena bulls are highly suitable for fattening as they are rarely used for draft purpose. In addition to cattle, the area has large population of Camels and Goats. A major advantage of Borena-Guji corridor is its location along the Ethiopia-Kenya highway where possibilities to access the Kenyan market is open but competition from the Kenyan side might be high particularly for dairy. Yebelo, the capital of Borena zone is located at 600KM from Finfinnee and 330 from Hawassa city. .Modjo-Moyale railway line to be constructed in the period between 2016 and 2020 will pass through the area. The Oromia Regional Government gives attractive investment package to encourage investors to Borena-Guji corridor. 


 

  Specific Investment Opportunities Product

Dairy Farming with focus on breeds

The number of exotic or improved cow breeds in Ethiopia is less than 2% of the total milk cows. Though the two milk corridors identified for prospective investment have better proportion of improved breed, they still have very small mix. Setting-up a model state of the art integrated farming such as Genesis Agro-Industries or Alfa farms have dual purpose of making good money from sales of milk or related products.

Pasteurized Milk and Yoghurt

Less than 5% of milk produced is marketed as processed fluid milk. Demand for pasteurized milk is growing fast with increasing urban population and emerging middle class. Milk processing plant in Bishoftu-Adama as well as Selale-Fitche corridors can easily serve the central market including Finfinnee which has an estimated demand of over 65 million liters per year. 

Milk Powder

Ethiopia imported US $5.4 million milk powder and related products in 2013. From 2009, import has grown by over 50 times.  The major imported milk powder is the leading brands such as NIDO of Nestle. In addition, milk powder is widely used for infant formulas. There is no domestic processing company. Milk powder processing is relatively a big investment that requires minimum critical volume. Hence companies need to build a robust milk supply chain to get the needed volume in advance. In addition to the domestic market, export to the neighboring countries and Middle East is a viable business opportunity. Fortification with vitamins and minerals can be additional winning edge.

Fattening and Slaughter House

Oromia region offer sound opportunity for fattening and slaughterhouse. In particular areas around Adama, and Batu are highly suitable for fattening. The area has good access to infrastructure to set-up slaughterhouse. Most of the export abattoirs (Modjo Modern, Helmix, Organic, Luna etc) in the country are located in this area. In addition, big international players, VERDE Beef from the USA and Allana Group from India, are establishing meat processing in Batu area. The main market for meat and button products is to the Middle East countries but the domestic market is also high potential. Bulls and calves for fattening can easily be acquired from Borena, Bale and Arsi zones within Oromia Region as well as from Omo valley in South Nations, Nationalities and People’s Region (SNNPR).  The Borena-Guji corridor can be another consideration with easy access to good calves and bulls for slaughter house but logistics might be a challenge.

Ostrich Farm Business Opportunities

Ostrich business farm opportunities are also other untapped investment potential available in the region which is waiting for potential Investors.

 

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