Alternative Milk Marketing Channels and Dairy Performance of Smallholders in Pakistan: A Case of South Region of Punjab Province

This study attempts to measure the economic benefits of milk marketing cooperatives working intwo districts (Vehari and Muzzafargrah), geographically located in the southern region of Punjab province of Pakistan. The study analyzed the significance of milk marketing cooperatives by revealing and evaluating possible returns to smallholders in dairy sector. The hypothesis that milk marketing cooperatives are beneficial for milk producers was tested by surveying the cooperatives’ members. Econometric techniques to draw inferences include the application of t-test, binary Logistic model and Propensity Score Matching (PSM) with algorithm of near neighbor (NN) and interval matching. The impact of cooperative membership on small milk producers was evaluated by calculating the values of average treatment effects (ATE) on eight performance indicators. The outcomes of study disclosed that cooperative members have higher farm income, more milk production, reared improved cattle breeds, get better access to veterinarian services and used more nutritious fodder (silage), as compared to non-members. The findings of study also provided the evidence that establishment of milk marketing cooperatives foster more economic opportunities to female dairy smallholders and assist them in rural development. Based on study findings certain policy options has also been suggested to extend the farmer cooperative activities over different aspects of agriculture sector.