‘Mangalam Dairy and Foods’ is a private dairy processor in Hariyon, Sarlahi. Commercial Agriculture for Smallholders and Agribusiness (CASA) Programme partnered with Mangalam to establish a modern dairy plant with the vision of bringing more milk from the informal sector to the formal sector and thus also providing local farmers a secured market to sell their milk. Sarlahi District is an up-and-coming milk production area but is lacking in terms of presence of modern dairy facilities. Mangalam seeks to capitalize on this opportunity by establishing a new dairy company and developing this untapped market.  The first phase of the project ended in July 2021 with Mangalam securing an agriculture loan from a leading commercial bank. Most of the loan has been utilized to construct the dairy plant and to purchase necessary equipment and materials for factory operations. During this phase, CASA supported Mangalam to make them investment-ready by developing concrete business and investment plans, investor matchmaking and technical assistance to develop the structural blueprints of the dairy plant, production floor design and installation of equipment. 

After the successful inauguration of Mangalam Dairy in Feb 2022, the project has entered its second phase. CASA continues to support Mangalam on strengthening its supply chain by developing linkages with milk collection centers, aggregating smallholder farmers, improving production quality, and creating market presence for the dairy. Similarly, CASA has also provided Mangalam with dairy technologists to help them meet dairy food quality requirements and develop capacity of other staff workers to produce quality dairy products.

One example from the field is 35-year-old Sher Bahadur Shahi (Suraj), a commercial farmer from Satyawati Rural Municipality in Gulmi District. He previously farmed on a small scale but started commercial-scale farming when Paicho Pasal Pvt. Ltd established a new collection center in Satyawati. Paicho Pasal is a private agribusiness that collects, sells and processes fresh vegetables and other agriculture produce from remote areas regardless of its volume and sells it to the urban markets while processing the unsold produce. Although Paicho has set up a collection center in the village near his farm, where local villagers can aggregate their produce, Suraj would have the option of having his produce collected from his farm by Paicho, due to the scale of his production. CASA has supported Paicho in conducting a mapping study to establish various collection centers in the new location so that farmers like Suraj can have proximity to bring their produce. “Because of Paicho’s assurance, I was confident enough to commercialize my farming”, he said. Suraj explained how difficult it was to sell vegetables on a local scale as he would barely earn enough. Now, he is encouraged to farm on a larger scale as Paicho would buy any volume of his produce. There are at least fifteen other farmers in his village who, like him, have started commercial vegetable farming on nearby farms.  With CASA’s support, Paicho mobilizes several agriculture technicians who support individuals like Suraj to set up their vegetable farms and provide technical assistance as required. The technicians visit the farm weekly and provide suggestions on vegetable farming techniques and on establishing a nursery for seedlings, building polytunnels, setting up trellises, weeding, pest control etc. “The support provided by the technicians has been a big help to me”, says Suraj.  Swisscontact is a leading partner organization for the implementation of international development projects. The organization promotes inclusive economic, social, and ecological development to make an effective contribution towards sustainable and widespread prosperity in developing and emerging economies. In Nepal, Swisscontact is registered as an International Non-Governmental Organization that currently has five development programs, including Commercial Agriculture for Smallholders and Agribusiness (CASA) Program. CASA with a vision to increase investment in Agri-SMEs which trade with smallholders, has been helping many agribusinesses like Mangalam and ‘Paicho Pasal’ to access finance and investment to expand their business and to bring more, poorer smallholders into agribusiness supply chains. CASA is being implemented in Nepal by Swisscontact and works in two value chains—dairy and vegetables.  CASA’s primary work is to support a shift in agriculture, away from subsistence farming towards a more productive, commercially vibrant agriculture sector by supporting agribusinesses to bring smallholders into commercial markets, connecting smallholders with increased demand from local, regional and export markets.  To achieve this vision, CASA works under three intervention areas: 

• SME interventions aimed at improving SME investment-readiness, deal pipeline and SME access to finance and investments for growth and expansion. 
• Producer Organization interventions aimed at improving productivity, climate resilience, aggregation, and sourcing to link more, poorer farmers to commercial markets.
• Enabling Environment interventions aimed at improving the Business Environment for vegetables and dairy value chains. 

Till date, the programme has engaged with over 25 agriculture cooperatives and trained more than 16,000 farmers on areas of Good Agricultural Practices, Good Manufacturing Practices, Financial Literacy and Post-harvest Management. Similarly, the programme has provided tailored Technical Assistance to over 19 SMEs, ranging from developing business plans, conducting mapping studies, drafting marketing strategies to developing pitching decks to potential investors or financial institutions. Through this support, CASA has been able to leverage NPR 25 crore investment into partner SMEs by commercial banks.  During the covid pandemic, CASA provided grant support to 15 Milk Producer Cooperatives as a revolving fund to reinstate breeding and health services of animals. Similarly, the programme supported several dairy smallholders for animal replacement and interest rebate and credit service facilitation.  CASA also provided a small grant to partner SME for cold storage rental and conversion charges which ensured these processors continued collecting milk during the peak of COVID lockdowns. Under the vegetable sector, CASA distributed seeds and fertilizers to vegetable smallholders in Bara and Rolpa to offset the low availability in the market. While at a broader SME level, CASA operationalized Koklass mobile e-commerce platforms to support nine agri-businesses to go digital and increase sales while enabling them to have their supply chain up and running.