CAMEL MILK VALUE CHAIN ASSESSMENT REPORT FINAL ...

CAMEL MILK VALUE CHAIN
ASSESSMENT REPORT
FINAL REPORT
May 2008

CAMEL MILK SUB-SECTOR
VALUE CHAIN ASSESSMENT REPORT
Corps
Corps
Report developed by: Ch.Tsetsegmaa, Executive director of Altai-Swiss Foundation
D. Altaibayar, Program Officer of Altai-Swiss Foundation
P. Dolgorsuren, Program Officer of Altai-Swiss Foundation
G. Munh-Erdene, Program Officer of Gobi Initiative/Mercy
U. Erdenebileg, Senior Agricultural Officer of RASP/Mercy

Content 2
I. Brief introduction 3
1.1 Camel milk production in Govi-Altai aimag 3
1.2 Goal and methodology of survey 5
II. Specifics of camel milk sub-sector 7
2.1 Final consumer of camel milk products 7
2.2 Chart of camel milk sub-sector 9
2.3 Main participants of camel milk value chain, links 9
III. Main opportunities and obstacles facing camel milk sub-sector/value chain11
IV. Commercial solutions to camel milk sub-sector obstacles 11
V. Evaluation of solutions to camel milk sub-sector obstacles 14
VI. Program intervention 18
List of sources 19
2

I. BRIEF INTRODUCTION
1.1 Current camel milk production in Govi-Altai aimag
Govi-Altai aimag herders have long been raising camels in Mongolian Altai region and camel
milk has always been a main raw material of food anda source of income for local herders.
Table 1: Growth of camel population in Govi-Altai soums where camel milk is produced
and sold on the market
Soums 2003 2004 2005 2006 2007
Biger 1179 1271 1302 1339 1492
Haliun 2022 1993 2098 2301 2435
Tugrug 2130 2208 2324 2503 2729
Sharga 3160 3113 2998 3045 3273
Aimag 23800 24400 25000 26000 27300
According to the above table camel population has been steadily rising during the past few
years. Govi-Altai has 27 thousand camels and 7.5 thousand or 29.5% of all camels are cow
camels. 90% of all cow camels are being used for milk production.
Percentage of cow camels in Sharga gobi soums
Biger
5% Khaliun
9% Tugrug
12%
Other
soums
58%
Sharga
16%
The region with the highest density of camels in
the aimag and most favourable conditions for production and sales of camel milk is situated in
area of Sharga, Tugrug, Haliun and Biger soums. These soums are located relatively close to
the market (45-125 km from aimag center) and 42% of all cow camels are being raised here.
The herders from these soums have been raising camels in the area near Sharga, Tuhum,
Tungalag rivers, producing and selling a part of their camel milk in the aimag center and other
markets. Other soums have relatively small population of camels and are located far from
central markets. The camel herders from other soums produce and sell milk for soum center
residents and a few neigboring soums.
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Below is a calculation table of potential production levels of camel milk in the whole aimag
and above mentioned soums.
4

Table 2: Potential level of camel milk production in Govi-Altai aimag, in liters
Soums 2004 2005 2006 2007
Biger 37,942 41,391 44,150 59,097
Haliun 71,974 73,584 77,033 89,910
Tugrug 54,728 70,365 75,884 58,637
Sharga 113,825 110,376 112,216 126,473
Total 278,469 295,716 309,283 334,117
in the aimag 852,863 874,372 918,946 1,020,708
Explanation: according to studies of milk sold on the market, herders use an average of 740
mm of milk from one cow camel per day to sell on the market.
Some studies of camel milk suggest the milking season lasts an average 17.5 months and the
output of milk is 319,8±1,04 /174,7-576,3.
The camel milk contains 18.6% of dry ingredients, 2.1% of fat, 3.1% of lactose and 10.8% of
protein including 1.75% of casein and 1.32% of ash. There are 8.6 mg% of vitamin C and 0.18
mg% of calcium in the milk. (Dashdendev, 1963) Camel milk contains 20-21 types of
aminoacids (Osorhaan, 1979). One kg of camel milk is capable of supplying 100% of daily
human needs for calcium and phosphorus, 57.6% of human needs for potassium, 40% for
iron, copper, zinc and magnesium, and 24% for sodium. (Batsuh, 1994). Fat globules are 3.7
microns across, melting temperature is 44.8 0 C, coagulation temperature is 25 0 С.
Saturated acids make up 60.9% including palmitin (27%), stearin (14.7%), myristic acid
(12.4%). Amount of kapron and capric acid is very low, only 0.8%. (Indra, 1989). Camel milk
fat contains 69.1% of unsaturated acid.
Camel milk can be useful for treating some liver diseases. Clinical tests proved that camel
milk can lower bilirubin, have positive effect on metabolism on human cell level, alleviate
vitamin deficiency and loss of nutrients, improve immunity and digestion. (Jadambaa, Batsuh,
Baigalmaa, 2000)
According to Osorhaan's research in 1979 fermented camel milk has an average 90-110 Т 0 of
acidity, 0.3 of alcohol, 12.4% of dry ingredients, 4.8% of fat, 3.63% of protein, 0.12 mg/kg of
carotene, 56 mg/kg of vitamin C. One kg of fermented camel milk can provide 766 kcl of
energy.
3 liters of fermented milk is used to produce 1 kg of curd. This output is twice lower than curd
made from sheep, goat and cow milk. 100 l of camel milk can be used to produce 15 pieces of
dried curd with 6-7% of moisture and 38-50% of fat. (Tserenpuntsag, 1987). Processing 100
kg of camel milk in temperatures between 50-55 0 С can yield 9-10 kg of sour cream with 66%
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of fat. Processing the same amount of camel milk in temperatures between 45-55 0 С can
generate 12-14 kg of sour cream with 35-40% of fat. (Indraa, Osorhaan, 1987)
1 kg of curds is derived from six liters of camel milk, one kg of dried curd is produced from
9.06 l of milk, one kg of melted butter with 98% of fat is made from 15 liters of milk with
5.66% of fat, one kg of sour cream with 76.8% of fat is made from 13.5 l of milk with 5.66%
of fat. Fermented camel milk is made of pure starter culture. It must be stirred 5000-6000
times by electrical beaters every 3 hours. Fermentation starts at temperatures of 20-25 degrees
for the first 24 hours, after that the temperature should be cooled down to 18-20 0 and
fermentation will be complete after 6 hours. The fermented milk can be kept for 60 days in
dark bottle at a temperature of 4-5 0 C and becomes ready for consumption. Carbonated
fermented milk can be preserved for up to 90 days.
Curd, dried curd, butter produced from milk fermented by industrial methods had more
nutritional value than the same products made from traditionally fermented milk. It's possible
to produce 1.2-1.3 kg of dry milk with 28.9% of protein content, 25.66% of fat, 36.34% of
lactose, 94% of solubility and 15T 0 of acidity out of 10 liters if milk with 5.66% of fat.
Establishing dairy camel farm is the best way to produce dairy products from camel milk.
(Osorhaan, 1975)
A survey was conducted among 34 herders from Biger, Haliun, Tugrug and Sharga
soums. According to this survey 6 herders or 17.6% of respondents milk their camels for 1-6
months, 9 herders (26.4%) milk for 6-9 months, the remaining 19 herders (55.8%) indicated
they milk their camels for over 11 months. 80% of respondents get 0.5-0.8 liters of milk from
one time milking activity during summer season and 0.3-0.5 l of milk during cold season. A
female camel is milked for 365 days a year and produces an average of 0.74 l of milk per day.
Number of camels milked by one household ranges from 5 to 30 camels. But herders
producing and selling camel milk on the market milk an average of 13 camels per household.
Table 3: Current camel milk production in Govi-Altai aimag
Daily
Number
average
Number of of
Location
milk
households milking
output,
camels
mm
Milk
production
duration,
days
Current
production,
liters
Amount
sold on
market,
liters
Haliun /Olon Bulag/ 15 13 0.74 365 52669.5 35288.6
Tugrug /Uguumur/ 10 13 0.74 365 35113 23525.7
Sharga /near soum center/ 10 13 0.74 365 35113 23525.7
Tugrug /Tuhum/ 13 13 0.74 365 45646.9 30583.4
Tugrug /Tungalag/ 12 13 0.74 365 42135.6 28230.9
Sharga /near Eev/ 12 15 0.74 365 48618 32574.1
Total 259,296 173,728
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Govi-Altai aimag producers and suppliers of camel milk are concentrated in specific
area and most of these herders raise more than 5 cow camels. These herders sell 67-70% of all
products on the market.
1.2 Goal and methodology of the survey
Goal of survey: study and identify obstacles to production and sales of camel milk, improve
competetiveness of camel milk sector by developing camel milk business and services.
Methodology of survey
Scope of survey. Biger, Haliun, Tugrug and Sharga soums of Govi-Altai aimag were selected
to conduct camel milk sub-sector survey. The following criteria was applied when selecting
these soums: proximity to aimag center (no more than 150 km from aimag center), number of
camels, experience of herders to produce and sell camel milk products. Total of 56 people
were interviewed during the survey including 15 customers from the aimag center, 29 herders,
12 retailers from Eev hotel in Sharga soum, aimag center market, Burgast Bulag cooperative
in Tugrug soum.
Methodology of survey
1st stage: selection of sub-sector/value chain
Camel milk is one of sources of income for Govi-Altai herders and its market value is
constantly rising. Contribution of camel milk to local economy, potential for more
participation of local businesses in this type of production, number of participants in this
business are main factors for selecting this value chain.
2nd stage: Survey of sub-sector/value chain
During this stage the first step we took was to gather all digital and print information
related to sub-sector/value chain, data from secondary sources including previous surveys,
statistical information, agricultural researches, political agendas of aimag and soum
governors, short-term and long-term development programs, customs statistics. All
this information was consolidated and necessary information was used for our survey.
Next step was to organize interviews and discussions with main participants of the value
chain (people making decisions regarding this sub-sector), conduct simple questionnaire
surveys to verify some digital information. During the survey we identified main
participants of the sub-sector, their vertical and horizontal relationship with each other,
what they supply and buy from each other, how deep are their relationship, what
percentage of market do the participants account for. Based on the results of the survey we
created a chart of sub-sector/value chain.
Discussions and interviews have been conducted on the following subjects when we
identified main obstacles and opportunities:
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• Technology/product development
• Market
• Input supply
• Management, organization
• Policy coordination
• Finance
• Infrastructure
During the survey we attempted to a) identify impact of relationships in the sub-sector/value
chain b) reveal cooperation between businesses involved in horizontal and vertical
relationship c) compare international and local requirements on the specific product
3rd stage: identification of commercial or market solutions
In this stage we identified causes of obstacles/opportunities and proposed business solutions to
address these problems. We consider identification of who will implement sustainable
commercial solutions as business solutions. We did not approach this matter from the
program's interest.
We selected the best solutions among many potential solutions and listed them according to
level of importance.
4th stage: Evaluation of solutions
During the assessment we organized meetings on the aimag level to evaluate commercial
solutions: who will benefit from the solutions, who will implement these solutions, how to pay
for implementing the solutions.
5th stage: Program intervention or identification of activities to be implemented
Based on information collected during the previous stage we developed a work plan which
identifed problems and obstacles facing beneficiaries and implementing organizations of these
solutions and outlined intervention measures in these activities.
Survey team
The survey team consisted of the following members.
• Ch. Tsetsegmaa, Executive director of Altai-Swiss Foundation in Govi-Altai aimag
• D. Altaibayar, Financial manager
• P. Dolgorsuren, Project officer
• G. Munh-Erden, Program officer, Gobi Initiative/Mercy Corps
• B. Elbegjargal, Officer in charge of Agricultural Policy at Govi-Altai aimag
Governor's Office
• V. Davaadorj, Chief of Animal Breeding Office of Aimag Agriculture Department
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II. SPECIFICS OF CAMEL MILK SUB-SECTOR
2.1 Final consumer of camel milk products
Production of camel milk and milk products is limited depending on area and population of
camels. Camel milk has very high content of vitamin C and easily digestable alkalines and
acids. Camel milk is sold in the form of fermented milk for medicinal purposes and demand
for this product is high. Below is the list of main camel milk selling outlets.
Table 4: Current camel milk selling outlets
Sales outlets
Amount,
liters
%
Soum schools 4800 2.6
Soum hospital 3600 2.0
soum center residents 16000 8.8
Road canteens 79500 43.7
Aimag center 68300 37.6
Buraat Bulag cooperative 4560 2.5
Kidney treating
sanatorium
5000 2.8
181,760 100.0
Sales channel for camel milk
3% 3%
3% 2%
9%
35%
45%
Soum school
Soum consumer
Aimag center
Kidney sanatorium
Soum hospital
Canteens
"Buraat bulag" cooperative
The table 4 and the chart shows that most of Govi-Altai camel milk trade or 45% of all trade
takes place near Eev and Sharga bridge located on the roads going to the west. Small retailers
manage this trade on western roads. 35% of milk sales happen in the aimag center, 2-9% of all
9

milk is sold at soum centers, schools, hospitals. The sub-sector chart has more details about
activities of these outlets, their links and interrelationship with each other.
We tried to find out what kind of camel dairy products are sold on the market by studying 34
herders from Biger, Haliun, Tugrug and Sharga soums. They produced and sold a total of
76286 liters of camel milk in various forms of dairy products. We assumed that 1 kg of curd is
made from 6 liters of milk, 1 kg of dried curd is made from 9 l of milk and 1 kg of cream
products is made from 15 liters of milk.
3500
3000
3000
2500
2000
2000
1500
1500
1500
1000
500
1000
600
1200
800
700
1000
800
0
2005 2006 2007
Camel milk beverage Camel milk wet curd
Camel milk
Other products
70% of all camel milk is sold on the market. This chart indicates that most camel milk is sold
on the market in the form of fermented milk - 61% of all sales. 15% of milk is sold as curd,
11% as raw milk, 6% as dried curds and remaining 7% as cream and other products.
There are several reasons why 61% of all camel milk is sold as fermented milk:
• Fermented milk is easy and simple to produce. There is no need for special technology.
Consumers prefer to use fermented milk.
• Other dairy products use a lot of milk but output is low. For example 6 kg of curd is made
from 20 l of milk.
• The price of other dairy products is cheap though they use a lot of milk.
• Dried curd made from camel milk is not firm and easily crumbles. It doesn't dry
completely, so people don't buy it.
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Types and percentage of products sold at market
Creamy
products
7%
Wet curd
15%
Dried curd
6%
Milk
11%
Ferm ented
milk
61%
Camel dairy products are in great demand and current production is not able to meet this
demand. So prices rise every year. Camel dairy product prices grew up by 33.3-200% during
the last 2-3 years. For example raw milk price rose by 33.3%, fermented milk by 150%,
creamy products by 66.6%, curd by 200%. Even though the prices went up, the market
demand is still great.
According to Byambaa who sells camel milk
in Eev hotel in Sharga soum, 6 households
nearby sell every day 40-50 l of fermented
2.2 milk Camel to travelers. milk sub-sector But sometimes chart suppliers
run out of camel milk which causes
shortages. Number of consumers steadily
rises each year.
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Ulaanbaatar consumers
Recipient
Aimag
consumers -58
tons
Western
aimag
consumers
Soum schools,
sanatorium, hospital
-13,6 tons
Soum center-
16 tons
School tea
Break
program -
aimag
center
Milk retailers
Aimag center
market-6 people-
1,5-2,0 tons
Road hotels -9
people - 80 tons
Buraat Bulag coop-
4,6 tons
Camel milk
producers
Household needs,
fodder for young
animals-152 tons
Households with
less than 5 female
camels -74 tons
Households with
more than 5 female
camels - 260 tons
Input suppliers
Breeding sire
supplier
Veterinary
services -8
Information
Mobicom
2.3 Current participants of camel milk value chain, communication and information
Input suppliers: in order to raise productivity and improve quality of camels, elite camel
bulls are bought and used for breeding. World Vision international organization bought 150
camels for MNT 80 million and donated them to herders of Tugrug, Sharga, Haliun, Biger and
Tsogt soums. These camels included 30 Galba Gobi red bulls and 45 cow camels, 75
Hoszogdor cow camels from Tugrug soum
Veterinary service. There are 8 veterinary organizations working in Tugrug, Sharga, Haliun
and Biger soums which provide veterinary services to camels. One camel gets an average of
MNT 3000-3500 of veterinary services.
Information dissemination service. Mobicom cell phone services are used to exchange
information about buying and selling camel milk. Buraat Bulag cooperative and small retailers
12

in road hotels and restaurants receive information by cell phones. Herders also send milk sales
information by cell phones.
Producers. Herders are divided into herders with less than 5 cow camels and more than 5 cow
camels. Herders with less than 5 cow camels don’t sell milk and supply only own needs and
needs of their relatives. This milk accounts for 30% of total milk production. Herders with
more than 5 cow camels sell surplus of milk on the market. 94.2% of herders who participated
in the survey owned 10 and more cow camels. The herder household with the biggest
population of female camels could milk up to 50 camels a year, but due to lack of labor force
they were not able to milk them all. Herder households produce camel milk drinks using
traditional methods and sell them to aimag and soum residents as well as to travelers and
drivers.
Camel milk retailers. Retailers sell not only camel milk products. Dairy traders in the aimag
center black market sell camel milk with other dairy products. However supply of camel milk
is limited and only 1-2 tons of camel dairy products are sold annually. Camel milk is bought
from herders and sold to consumers for 300-600 MNT higher. Camel milk is bought between
October and March for 800-1000 MNT and sold at 1500-1800 MNT. Main Sharga soum
retailers of camel milk products are not in the aimag center. They are 6 households operating
Eev road hotel and 3 households operating restaurant near Sharga bridge. Local herders sell
their camel milk for 1000 MNT to these retailers and the retailers sell for 1500-1800 MNT to
travelers going to Hovd, Uvs and Bayan-Ulgii aimag. During winter and autumn when supply
is sufficient, the retailers manage to sell 240-300 l of camel milk a day. These two locations
sell about 33% of all produced camel milk.
Residents of aimag center and soums, and travelers buy dairy products without any
complaint. They buy in smaller quantities for own consumption. Camel milk curd is sold
mostly to travelers. It's possible to use travelers to promote camel milk products and expand
market.
Kidney treating sanatorium. Herders of Biger soum sell their camel milk products to Kidney
Treating Sanatorium. This sanatorium serves over 250 patients every day in June and July.
The daily norm for patients is 1 liter of camel milk per patient. Kidney sanatorium receives
clients from all over Mongolia including Ulaanbaatar. Camel fermented milk can reduce
swelling, lower blood pressure, decrease loss of protein, relieve urination problems. The
camel herders of Biger soum concluded agreements with the sanatorium to supply 6.4
thousand liters of camel milk products during 2 months.
There is one business in Govi-Altai that processes camel milk and makes "butsalgaa" or
"huurtsug". This business is Buraat Bulag cooperative from Tugrug soum. This cooperative
concluded a contract to supply camel milk products to 715 students of elementary classes of
two schools at the aimag center as a part of Tea Break Program. According to the contract the
cooperative will provide 150g of fermented camel milk per child every week. One serving
costs 300 MNT, and one liter of milk costs 1900 MNT. Total amount of products for the Tea
Break Program will be 4.6 thousand liters of camel milk during school season. The schools
buy camel milk drink from cooperative members and other herders for 1000 MNT per liter.
13

The cooperative manages all transportation issues and deliver more than 100 l of milk to the
aimag center every week. The cooperative member herders camp on the distance of 145 km
from aimag center and 30-40 km from the soum center. They bring the contracted camel milk
in their own vehicles.
Types
Technology/product
development
Market
III. MAIN OPPORTUNITIES AND OBSTACLES
OF CAMEL MILK SUB-SECTOR/VALUE CHAIN
Obstacles/opportunities
• Due to lack of proper processing technology, only fermented
camel milk is produced
• Quality of fermented camel milk easily deteriorates during
summer time, so it becomes difficult to sell
• Herders don't know how to add value to camel milk
• Sales are slow because residents of urban places don't
understand value of camel milk
• Camel milk is used for medicinal purposes, so it's difficult to
sell them in large quantities
• Sales of camel milk products are low due to short supply
Input supply • Pasture capacity, vegetation output is deteriorating. This causes
production of camel milk drop during winter and spring.
Management/organization • Herders are not able to make sales of dairy products in
organized way
• Some herders besides producing and selling own products
procure camel milk from neighboring soums
• Govi-Altai camel herders concentrate in certain area
Policy/Coordination • No government policy to raise value of camel milk products
• We support providing camel milk products to school children
once a week within the Tea Break Program
Infrastructure
• Roads and communication are poorly developed. It's expensive
to get dairy products to markets
• Herders don't assist each other in selling dairy products. This is
the reason why expenses are high
Finance • Herders sell dairy products cheap due to shortage of cash
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IV. COMMERCIAL SOLUTIONS TO CAMEL MILK SUB-SECTOR OBSTACLES
Problems Commercial solutions Solution providers
1. Assist to obtain
technologies for processing
camel milk and production of
value added products
There is no technology to
process camel milk and
produce different kinds of
dairy products. This is the
reason why herders make
only fermented camel milk.
2. Assist with obtaining loans
and equipment to establish
small businesses to produce
camel milk products
3. Support production and
sales of value added camel
milk products such as dried
worm curd, solid butter,
fermented and carbonated
camel milk, bottled
"butsalgaa" and etc
Local business support
organization, Altai-Swiss
Foundation, Agricultural
Extension Center, University
of Science and Technology,
commercial banks
Camel milk is easily spoiled
during summer, and it
becomes difficult to sell it
Herders don't know how to
add value to their product
Residents of urban areas don't
understand importance and
value of camel milk, so sales
4. Assist with development of
new products such as dried
curd with barley
5. Support establishment of
large water cooling storages
near herder households
selling camel milk
6. Assist with delivery of
camel milk to processing
plants in special vehicles with
refrigerators
7. Assist herders to learn
solid butter and fermented
milk production technology,
8. Help herders find
equipment for extracting milk
fat
9. Assist with production of
print materials to promote
value of camel milk products
Business support
organizations, Food Research
Institute, University of
Science and technology,
business operators,
Agricultural Extension
Center, Altai-Swiss
Foundation
Business support
organizations,
Agricultural Extension
Center,
Government organization in
charge of Agriculture
Altai-Swiss Foundation
Local business support
organizations,
Altai-Swiss Foundation,
15

of milk are slow
Camel milk is used for
medicinal purposes, so it's not
possible to sell them in big
quantities
Sales of camel milk products
are low due to shortage of
dairy products
Production of camel milk is
low during winter and spring
due to insufficient capacity of
pastures, poor growth of
vegetation
Herders are not able to sell
dairy products in organized
way
There is no government
policy to raise value of camel
milk products
10. Support production and
bottling of fermented camel
milk with low fat in small
bottles (250-500ml)
11. Assist with linking
Sharga soum retailers to local
herders and concluding a
contract to supply camel milk
products
12. Assist with safe bottling
of camel milk at retail outlet
13. Help herders raise their
income new services such as
offering camel milk, boiled
milk, hot fermented camel
milk to travelers
14. Help herders raise output
of camel milk during winter
and spring by providing
additional fodder to the
animals
15. Provide information on
fodder traders and fodder
price, help to connect with
fodder traders
16. Assist herders to supply
camel milk to certain selling
outlets near potential camel
raising area (Haliun Olon
Bulag, Tugrugiin Tuhum,
Tungalag, Uguumur, Sharga
gol). Help herders employ a
trading agent to supply camel
milk to processing factories
17. Help producers and
processors meet and discuss
camel milk processing issues,
raising price and value of
dairy products
Professional associations
Local business support
organizations,
Altai-Swiss Foundation,
Agricultural Extension
Center,
commercial banks
Business operators,
local business support
organizations,
Altai-Swiss Foundation
Local business support
organizations,
business operators,
Agricultural Extension
Center,
Altai-Swiss Foundation
Altai-Swiss Foundation,
Local BDS providers,
Government organization,
Professional associations
Business operators,
Government organization,
NGO
Support supply of camel milk 18. Introduce camel milk Agricultural Extension
16

products to school children
once a week as a part of Tea
Break Program
Delivery of camel milk
products to markets are
expensive due to poor road
conditions and bad
communication
Herders do't cooperate with
each other to sell dairy
products. This raises overall
costs
Herders are short in cash
which makes them sell their
dairy products cheap.
products bottled in 150-200
mg plastic bottles and offered
for Tea Break Program for
market
19. Assist herders camping
near each other to establish
herder cooperatives to jointly
sell camel milk products
20. Help herder groups to
establish contacts with
processors and retailers
21 Assist herders to
get advance payments for
their products putting them as
collateral
Center,
Professional associations,
local business support
organizations
Business support
organizations,
Agricultural Extension
Center,
Government organization in
charge of Agriculture,
Business support
organizations,
Business operators,
Altai-Swiss Foundation
Selection Matrix of commercial solutions to camel milk sub-sector obstacles
As a result of focus group discussions and questionnaires 22 commercial solutions to camel
milk subsector obstacles have been identified. A special selection method was used to choose
the best solution.
The following two criteria was used for selection.
• Income of participants grows as a result of this solution
• Impact of solution reaches many people
Income raising opportunities
High 1 2; 3; 5; 6; 7; 8
Medium 4; 8; 9; 10; 11; 14; 19; 16
Low 12; 17; 18;21;15
Low Medium High
Number of beneficiaries
17

V. EVALUATION AND INDICATORS OF COMMERCIAL SOLUTIONS
TO CAMEL MILK SUB-SECTOR OBSTACLES
Solution # 1
Definition of solution.
Assist to obtain technologies for processing camel milk and production of value added
products
Obstacle.
Herders don't possess technology to process camel milk and produce different kinds of dairy
products other than fermented camel milk. This hampers growth of herders' income
Potential solution providers:
• Local business support organization
• Altai-Swiss Foundation
• Agricultural Extension Center
• University of Science and Technology
• Commercial banks
• Buraat Bulag cooperative
Other market information related to the solution:
Buraat Bulag cooperative participates in the Tea Break Program and annually produces 4600 l
of camel milk products and supplies them to school children in Govi-Altai aimag center. It's
possible to introduce camel milk processing technology based on Buraat Bulag cooperative
and develop local small dairy processing plants. The industrial technology to process camel
milk exists but dairy industry hasn't been able to introduce it into their operations yet.
.
Threats
• Lack of skilled human resources with knowledge of camel milk processing technology
• High costs of introducing technology
Sustainable result:
Volume of processed camel milk and sales income of businesses and herders will grow,
business operations will begin to stabilize
Evaluation indicators of solution provision:
• Number of businesses using camel milk processing technology, growth of their
income
18

Solution #2
Definition of solution.
Assist with obtaining loans and equipment to establish small businesses to produce camel milk
products
Obstacle
Herders don't possess technology to process camel milk and produce different kinds of dairy
products other than fermented camel milk. This hampers growth of herders' income
Potential solution providers:
• Local business support organization
• Business entity,
• Altai-Swiss Foundation
• Agricultural Extension Center
• University of Science and Technology
• Commercial banks
Other market information related to the solution:
Currently herders sell one liter of fermented camel milk for 1000 MNT and retailers add 500-
800 MNT per liter without adding any value
.
Threats:
• Sales of camel milk products are low due to poor promotion and product recognition
• Difficult to select proper equipment
Sustainable results:
More commercial deals between processors and herders, growth of camel milk production,
expansion of business activities
Evaluation indicators of solution provision:
Amount of camel milk supplied to processing plants, number of herder groups and
cooperatives supplying milk, sales income
Solution #3
Definition of solution
Support production and sales of value added camel milk products such as as worm dried curd,
solid butter, fermented and carbonated camel milk, packaged "butsalgaa" and etc
Obstacle.
Herders don't possess technology to process camel milk and produce different kinds of dairy
products other than fermented camel milk. This hampers growth of herders' income
Potential solution providers:
• Local business support organization
19

• Business entity
• Altai-Swiss Foundation
• Agricultural Extension Center
• University of Science and Technology
• Commercial banks
Other market information related to the solution:
There are available technologies to use extracted fat from camel milk for production of
cosmetic and beauty products, use fat free camel milk for production of dried worm curd and
pasteurized fermented milk. These technologies can be used by local processing plants.
Threats:
• It's difficult to link camel milk products to big markets
• Poor consumer recognition of the product
Sustainable results:
Establishing mutually beneficially links between processors and herders will increase
production and profit of camel milk products
Evaluation indicators of solution provision:
• Types of products, amount of sales
• Number of herder suppliers of raw materials, amount of sales income
Solution #5
Definition of solution
Support establishment of several refigerators with water cooling system near herder groups
selling camel milk products
Obstacle. Fermented camel milk can be easily spoiled during summer
Potential solution providers:
• Business support organizations, Food Research Institute, Technical University
• Business operators
• Agricultural Extension Center
• Altai-Swiss Foundation
Other market information related to the solution:
Establishing milk cooling storages with natural or artificial cooling systems will allow to cool
camel milk down to 2 0 C and keep for 24-36 hours during summer. Each small retail outlet will
be able to receive 400-500 l of camel milk and dairy products at one time.
Threats:
• It could become difficult to procure raw materials because suppliers are not organized.
20

• Herder might supply products not meeting production standards
Sustainable results:
Paying cash to herders makes them more interested in selling dairy products further.
Processors will have a stable supply of raw materials
Evaluation indicators of solution provision:
Number of retal outlets, amount of products received, amount of sales
Solution #6
Definition of solution
Assist to transport dairy products from cooling storages to processing plants in vehicles with
refrigerators
Obstacle
Camel milk is easily spoiled during summer so it becomes impossible to transport it.
Potential solution providers:
• Business support organizations, Food Research Institute, Technical University
• Business operators
• Agricultural Extension Center
• Altai-Swiss Foundation
Other market information related to the solution:
Camel milk can be transported in vehicles with 2-3 ton capacity refigerators to the market.
This service should be provided by separate business organizations or a processing plant.
Threats:
• Transportation costs rise
• Need to transport dairy products separately by their types might arise
Sustainable results:
Transportation services will be provided by interested businesses or processors on commercial
terms
Evaluation criteria of solution provision:
Number of businesses engaged in transportation of products in refrigerators, their sales
income
21

Solution #7
Definition of solution.
Help herders to learn technology to make solid butter from camel milk and produce fermented
camel milk from fat free milk
Obstacle
Herders don't know how to add value to their products and lose opportunity to raise their
income
Potential solution providers:
• Business support organizations,
• Agricultural Extension Center
• Government organization in charge of Agriculture
• Altai-Swiss Foundation
Other market information related to the solution:
Herders can extractfat from camel milk and produce solid butter in household conditions, sell
the product on the market cooperating with other sellers and maximize their profits.
Threats:
• Herders don't possess technology to extract fat and make solid butter
• Herders don't have knowledge to make fermented camel milk from fat free milk
Sustainable results:
Buying solid butter from herders will encourage them to produce more products and raise
their income
Evaluation criteria of solution provision:
Amount of solid butter produced and sold on the market, sales income
Solution #8
Definition of solution.
Help herders purchase fat extracting equipment
Obstacle.
Herders don't know how to process milk and add value, so they lose opportunity to raise their
income
Potential solution providers:
‣ Business support organizations,
‣ Agricultural Extension Center
‣ Government organization in charge of Agriculture
22

‣ Altai-Swiss Foundation
Other market information related to the solution:
Herders will be able to raise their income from dairy products by extracting milk fat and
producing solid butter
Threats:
- Lack of equipment to 1extract fat from milk, lack of knowledge to operate such an
equipment
Sustainable results
Evaluation criteria of solution provision:
- Amount of solid butter sold, growth of sales income
23

Proposal to improve camel milk value chain
VI. PROGRAM INTERVENTION
Recipient
Aimag
center
Nomin,
Minii
Delguur
Moncream
Tea Break,
aimag
Camel milk
products
Pasteurized
fermented
camel milk-
0,5 l
Carbonated
fermentd milk-
0,5 l
Dried worm
curd
Solid butter Huurtsug - 0,2
l
Camel milk
processor
Buraat Bulag cooperative- Camel milk
processing plant
Dried curd with
20% barley
Transportation of milk in refrigerators
Related
services
Cooling point
Cooling point Cooling point Cooling point
Primary processing
of camel milk
Solid butter
Fat free fermented milk
Pure milk
Camel milk
producers
HALIUN
/Olon Bulag/
camel herder
groupsг-20
households
TUGRUG
/Uguumur/
camel herder
groups -9
TUGRUG
/Tuhum/
Camel herder
groups -13
TUGRUG
/Tungalag/
Camel herder
groups-12
SHARGA
Camel herder
groups-10
Input suppliers
Supplier of camel
bull
Supplier of
fodder
Veterinary service
- 8
Information
Mobicom
24

Solutions
Facilitate introduction of
technology to produce value
added camel milk products.
Assist with acquiring loans,
equipment and technology to
establish camel milk processing
small plants.
Support production and sales of
value added camel milk
products such as worm dried
curd, solid butter, fermented
and carbonated camel milk,
bottled "butsalgaa" and etc
Support establishment of water
cooling storages near herder
groups engaged in production
and sales of camel milk
products
Assist to transport dairy
products from cooling storages
to processing plants in vehicles
with refrigerators
Help herders to obtain
equipment to extract fat from
camel milk
Potential program intervention
• Help herders to conduct primary processing of camel
milk. For example organize trainings for herders on
extraction of fat from milk, production of solid butter
and fat free fermented camel milk
• Support establishment of camel milk processing plants
based on current dairy businesses. Develop profitable
dairy production project. Facilitate purchase of dairy
equipment.
• Teach herders to feed camels during spring season when
output of milk falls. Support fodder supply businesses
• Improve technology for production of value added
camel milk products
• Link finished products to big markets. For example
assist with getting access to Moncream or trade
networks
• Produce new products, promote them for the market
• Support neighboring herders from Olon Bulag in
Haliun, Uguumur, Tuhum, Tungalag, Sharga river in
Tugrug soum to establish herder cooperatives and
partnership with the purpose of jointly selling products
on the market.
• Support establishment of cooling storages for receiving
and preserving camel milk. Support businesses engaged
in receiving and preserving these products.
• Support transportation of camel milk products from
cooling storages to processors in vehicles with
refrigerators. Provide necessary information to
interested parties about vehicles with refrigerators
• Provide market information about milk fat extracting
equipment and its suppliers. Teach to use equipment
25

Literature
1. Dashdendev D. 1967. Research of some physical and chemical charateristics of camel milk
during milking season
Written by University of Agriculture, No 9, page.-25-30.
2. Jadambaa Sh., Batsuh Ts., Baigalmaa P. 2000 Research on use of camel milk to treat liver
diseases.
Product of Technical University, No 8, page 17-21
3. Indra R, Magash A, Biichee N. 1998. Camel Research. Ulaanbaatar., page 303
4. Indra R., Osorhaan I.1987. Industrial processing of camel milk. Agricultural magazine, No1
5. Luvsan B. Camel farming in Mongolian People's Republic. UB., 1975, 112 pages.
26