The Milky Way Program: Nepali Smallholders Lead Dairy Sector Transformation

Kamalamai municipality is in a verdant valley in the Sindhuli district of Nepal, a short flight southeast from the capital of Kathmandu. The many smallholder farming households in Kamalamai have traditionally subsisted or earned meager livings from what they can grow on their plots and the few livestock they typically own.

But in the last year and a half, this rural spot and its farmers have become the high-profile face of the Milky Way Signature Program — under which Heifer International, Korean and local partners are supporting the Government of Nepal’s objective to catalyze the transformation and modernization of the country’s dairy sector.

One major focus of the program is to ensure that Nepal’s smallholders directly benefit from this transformation — hence, the decision to locate a Milky Way Model Dairy Village in a place like Kamalamai and entrust high-quality Korean Holsteins to local farmers. About 90 percent of Nepal’s farmers are smallholders, but currently, only about 5-10 percent of them consider dairy farming a money-earning business. For the vast majority, their local breeds of cows mainly provide milk for home consumption.

I visited Kamalamai in late May 2024 to witness the project’s progress and see how the local farmers are faring with the full-bred Holstein cows donated by Korea. These were part of a total consignment of 100 cows and eight bulls transported to Nepal in late 2022 and early 2023.

A primary motivation for the Koreans to donate the cows was the essential livestock assistance provided by Heifer International to rebuild Korea following the Korean War. American cows shipped to Korea in the company of Heifer’s “Seagoing Cowboys” helped Korea establish its own dairy industry. The donation of Holsteins to Nepal is a high-level example of Heifer’s Passing on the Gift® philosophy. Now an advanced industrial country, Korea is sharing its bounty with Nepal to allow the latter to become a dairy powerhouse.

To be sure, the Holsteins require far more care and attention than Sindhuli residents have typically devoted to local breeds — a steep learning curve for the women farmer recipients and their families. But, they are enthusiastically focused on the task at hand and are highly motivated by the cows’ ability to produce substantial volumes of milk.

“If a family can get 30-40,000 Nepal rupees a month by producing more milk, people will happily stay in the villages. We need to have better incomes in the countryside to encourage young people to stay.” — Rajendra Prasad Mishra, Secretary of the Ministry of Agriculture and Livestock Development in Kathmandu

Whereas before, the farmers didn’t conceive of dairy as a business opportunity, they now see great potential for increasing their incomes and hence their available savings to send children to school, build better houses and further diversify their income streams — such as through growing and selling fodder. Heifer is working with SIDS, a local nongovernmental organization implementing partner, to provide the farmers with extensive training and support for building sturdy shelters, feeding troughs, water tanks and more.

This spirit came through when we met with Rukhmini Adikari  — a farmer, vice president of her all-women Tallo Rajpani self-help group and board member of the recently formed Kamalamai Social Entrepreneur Women Dairy Cooperative. Rukhmini and her husband have two Korean Holsteins, one of which gave birth to a calf, with the mother producing milk — about 21 liters per day compared to the roughly seven liters from their local breed.

Rukhmini explained the many ways she and other farmers have learned to care for the cows. For example, they now follow a strict washing protocol, including a post-milking dipping fluid to prevent mastitis, something they didn’t do prior to Heifer training. Each cow also now has a mat to lay on that decreases the chance of picking up soilborne ailments. Farmers also used to leave the cows’ feed on the ground, but now it’s placed in tidy troughs.

Is this all working? Well, nearly all the Holstein heifers in the village have become pregnant or already calved, indicating that they can adapt to and thrive in the local conditions. Rukhmini also attested to the benefits of the self-help group for the women involved. “Before, women didn’t get out of the house; before, we were very shy. Heifer has taught us to speak up... We are confident we can do this on our own,” she said. Her husband voiced his full support for her and other women, saying, “I try to help; I’m part of her journey. I not only do farm work but also household chores.”

At the macro level, Milky Way directly feeds into the Nepal Government’s policy goal of strengthening the country’s dairy sector and stemming a growing dependence on dairy imports, particularly from neighboring India. This ambitious program takes a systemic approach to promoting the professionalization of the dairy value chain, touching everything from government livestock breeding practices to the production of milk and value-added dairy products to improved distribution and marketing for an evolving consumer dairy market.  

The key challenges currently facing the dairy sector are low milk productivity due to poor genetic stock and poor access to technologies and inputs; relatively high cost of production, largely due to imported feed, which accounts for about 50 percent of total costs; quality control issues due to substandard husbandry and biosecurity practices; and lack of price and policy incentives for producing higher-quality dairy products.

One important role of the model dairy village is to act as a “center of excellence” where best practices in animal husbandry and milk processing are adapted to the smallholder context and then propagated throughout the country. About 500 farmers in Sindhuli district are expected to benefit directly from the availability of Korean Holsteins and their offspring, but the expansion of genetic improvement and best practice adoption is targeted to reach 500,000 farming households in total. The Nepal Government has committed to driving this expansion of impact.

On the genetics side, the model dairy village will also serve as a wellspring for a supply of high-quality Holstein bulls — the Holstein heifers as the bull mothers — that government breeders will leverage to replenish their aging genetic stock and improve dairy cow breeds nationwide.  

During a visit to the regional office of Nepal’s National Livestock Breeding Organization in the town of Lahan, Office Chief Shiva Nath Mahato described how the two Korean “superbulls” they received have added significant value to their stock of various types of breeding animals — some 33 in total. “It’s a positive collaboration between Heifer Korea and Nepal,” he declared.

This is a truly demand-led project, supporting the country’s development goals. In agriculture, dairy is ranked second only to the primary staple, rice, in terms of agricultural policy priority for advancement. Indeed, it was impressive to hear from local leaders — like a local ward chair, the mayor and even Nepal’s State Secretary in the Ministry of Agriculture and Livestock Development — who are excited about how Milky Way can help supercharge efforts they are already making to turn Nepal into a dairy powerhouse via systemic change.

Mahendra Dhakal, chair of Ward 4 in Sindhuli, welcomed us on a spacious plot of land by a parched riverbed (this was the pre-monsoon dry season), where he announced that he had agreed to have the plot designated as the site for a planned dairy processing center for local Holstein owners. He presented an ambitious vision for the model dairy village, where a combination of dairy production and a planned silage plantation would make Sindhuli a supplier for other communities and possibly even other countries. He could see the strong potential of what was taking shape in the village.

Kamalamai Municipality Mayor Upendra Kumar Pokharel was equally upbeat about Milky Way’s local impact. “Before this project, we farmed in a very traditional way. Now, we are going commercial — and this will help to boost economic activity. More milk will mean greater prosperity,” he said. “In the past, farming was not productive, and many people left the area. I think that the Model Dairy Village can help to keep people in the municipality. It also might help to slow down outmigration.”

Indeed, the migration theme — and the possibility of generating interest in local enterprises — came up again when we met with Rajendra Prasad Mishra, secretary of the Ministry of Agriculture and Livestock Development in Kathmandu. He said: “If a family can get 30-40,000 Nepal rupees a month by producing more milk, people will happily stay in the villages. We need to have better incomes in the countryside to encourage young people to stay.” We heard in the village that income from a couple of local crossbreeds typically brings in about 10,000 rupees a month, well below the threshold Mishra noted. However, two Holsteins could easily boost that figure to 50-60,000 rupees a month.

“The donation of cows is considered holy in Hinduism. It’s a precious gift we have received from Korea,” Mishra added.

There remains much work ahead to ensure that Sindhuli’s nucleus herd is on firm footing and that Nepal’s dairy sector reaches its full potential. More investment is also needed to build dairy processing centers, chilling centers and other building blocks in the value chain. But the evident commitment by so many key partners indicates that the will exists to succeed.