Determinants of groundnut producers’ market channel choice in Western Oromia region, Ethiopia
Oliyad Sori, Megersa Adugna
Abstract
Lack of adequate number of groundnut farmers' market channels remain long lasting problems in the study area. However, the choice of an appropriate market channel enables farmers to get reasonable profits from groundnut production. This study aimed to identify the existing groundnut market channels and to analyze determinants of channel choice decisions of smallholder groundnut producers in Western Oromia. A multi-stage sampling technique was used to select 400 sample household heads. Primary data were collected using a pre-tested semi-structured questionnaire and through key informant interviews using checklists. Multivariate probit (MVP) model was used to analyze determinants of groundnut market channel choices. The model resulted from that level of education, distance from the nearest market, access to market information, cooperative membership, trust in buyers, access to credit, the quantity of groundnut sold, own transport facilities, and access to off/non-farm income affected the probability of households in combination to select collector, wholesaler, retailer, and consumer market channels at different significance levels. The findings of the study suggest that there is a need for all concerned bodies like government to create market linkage between farmers and buyers, provide improved seed and other production inputs while farmers should maximize quantity of groundnut produced through accessing improved seed and other production inputs and market related development bodies should help in organizing farmers’ groundnut cooperatives. Similarly, strengthening micro financial institution to provide credit for groundnut producers is the area where interventions required.