Premier Quality Kenya Dairy Business Plan — Why the Fodder Block Is the Business

Why 12 acres of maize silage, Napier, desmodium and lucerne decide the cost per litre — and why bought-in feed destroys dairy margins.

Why the Fodder Block Is the Business

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3.1 The economics, stated plainly
3.2 The fodder block
3.3 Feeding and the ration

This is the most important section in the plan. A zero-grazing unit converts a land-based business into a feed-purchasing business, and feed is roughly half of milk revenue at maturity. Whether that feed is grown or bought decides whether the enterprise makes money.

Figure 7. Year 5 profit against the share of forage grown on the farm.

3.1 The economics, stated plainly

Figure 8. The silage economics that decide the enterprise.

Home-grown maize silage costs approximately KES 4.20 per kilogram fully costed including land, labour and inputs. Purchased silage costs roughly KES 7.50, and reported market prices run from KES 8 to KES 10 a kilogram — so the KES 7.50 used here is itself conservative. The difference of KES 3.30 a kilogram is the single largest lever in the model.

	Year 1	Year 2	Year 3	Year 4	Year 5
Milking herd, head	16	28	36	45	52
Young stock, head	18	32	48	62	72
Total forage required, tonnes	394	694	942	1 192	1 380
Grown on the 12-acre block at 90%, tonnes	355	625	848	1 073	1 242
Value of growing rather than buying, KES	1 170 180	2 061 180	2 797 740	3 540 240	4 098 600

3.2 The fodder block

Fodder	Area	Purpose
Maize for silage	6 acres, two crops a year where rainfall allows	The energy backbone of the ration; ensiled in bunkers to carry the herd through dry months
Napier grass, Pakchong or Kakamega variants	4 acres, cut and carry	Bulk forage; high yielding and drought-tolerant once established
Desmodium and lucerne	2 acres	Protein, reducing purchased concentrate; also improves soil nitrogen
Silage bunkers	Capacity for approximately 250 tonnes	Dry season buffer. A zero-grazing unit without conserved forage is exposed every dry season

Figure 9. Forage requirement and what growing it is worth.

Twelve acres are dedicated to fodder: six to maize for silage, four to Napier grass and two to a legume component of desmodium and lucerne. The legume block does double duty — it reduces the purchased concentrate requirement and fixes nitrogen for the maize that follows it. Silage bunkers with capacity for approximately 250 tonnes provide the dry season buffer, and a zero-grazing unit without conserved forage is exposed every dry season.

3.3 Feeding and the ration

Figure 10. The daily ration and what the cow returns.

Component	Quantity per cow per day	Indicative cost (KES)	Basis
Maize silage and Napier	45 kg fresh weight	189	At the home-grown cost of KES 4.20 a kilogram
Dairy meal concentrate	Approximately 6.75 kg at 23 litres	317	At KES 47 a kilogram, or KES 3 290 for a 70 kg bag
Minerals, salt and additives	As required	22	Mineral block, dicalcium phosphate and salt
Total feed cost	—	528	Per cow per day in milk
Milk revenue at 23 litres, gross	—	1 150	At KES 50 a litre before the cooperative deduction
Milk revenue at 23 litres, net	—	1 104	At KES 48 a litre after the 4% deduction
Margin over feed	—	576	Per cow per day in milk

Figure 11. Feed as a share of milk revenue.

Feed represents 53.2 per cent of milk revenue at maturity, against an industry rule of thumb that it must stay below 60 per cent for the enterprise to be viable. Measured on the daily ration alone the ratio is 47.8 per cent; the difference is the dry-period and transition feeding that the annual figure carries but the per-cow-in-milk figure does not. Either way the margin of comfort exists only because of the fodder block. On purchased forage the ratio rises to about 68 per cent and the business fails.

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