Artificial Insemination and Vaccine Production Value Chains in Kenya

This report responds to the terms of reference with the broad objectives to identify constraints to effectiveness, efficiency and growth in the AIVP value chains, and to ultimately identify opportunities for the Dutch private sector.

The current total value of the Kenya AI business exceeds 11 million USD at the current 18% of total dairy cattle breedings with a potential to generate over 37.6 million USD at 60% of total dairy cattle breedings. AI use is predominant in dairy cattle while less than 1% of the beef herd is bred using AI. The AI use is projected to grow by 1.5% to 5% in the Kenya dairy herd to reach up to 2.3 million inseminations per year by 2023 compared to the current 650,000. Consistent with privatization of AI service delivery, as much as 95% inseminations are now conducted by private AI service providers and cooperatives. In addition, semen imports increased from 20% of semen distributed in the 1990s to the current 40% of the semen distributed. This bodes well for private sector semen distribution market share growth. Both semen distribution and AI service provision generate sufficient returns to guarantee business growth. However, returns on investment for semen production business may not be guaranteed unless the critical number of doses of about 3 million per annum is produced.

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