Determinants of market outlet choice by smallholder wheat producers in Arsi Zone of Oromia National Regional State, Ethiopia

Abstract

Wheat is one of the staple crops widely cultivated in Arsi Zone of Ethiopia. It is the source of food and provides income for the majority of smallholder farmers. To this end, to benefit smallholders from their produce identifying and selecting the appropriate market is crucial. However, choosing a suitable market channel is not an easy task because there are different factors that influence market outlet choices. Hence, this study scrutinized the determinants of market outlet choice of smallholder wheat producers in Arsi Zone, Oromia National Regional State, Ethiopia. It uses primary and secondary data collected through questionnaires and desk reviews from 336 randomly selected households. Data were analyzed using multinomial logistic regression, percentage, and cross-tabulations of frequency distribution. The result from the multinomial logistic regression specifies that among the ten explanatory variables included in the model seven of them were statistically significant at 1%, 5%, and 10%. Those factors significantly affecting wheat producers’ market outlet choices were sex, age, education, year of participation, nearby market, nearby road and quantity produced. Based on the results, the study recommended that the government and stakeholders should focus on strengthening education, expansion of road infrastructure, telecom, and access to credit which promote farmers profitable market outlet choices in one hand and increases the production and productivity of wheat in another way.

Keywords:

• Wheat
• Market outlet
• multinomial logistic model
• Arsi

PUBLIC INTEREST STATEMENT

Agriculture is the building block and backbone of Ethiopian economy since it generates income for the smallholder farmers and other actors involved in the chain, sources of employment, generate foreign income and play a crucial role to improve the food security and living standard of the community. Cereals are the main sub-sector in the agricultural sector of the country in terms of its share in rural employment, agricultural land uses, and calorie intakes of the community and in terms of its contribution to the national income. Among the cereal sub-sector wheat has been played a crucial role in the diet of the community, as sources of income and employment in the study area. The area is well known potential of wheat producer and identified as the wheat producing corridor by the government. Despite such a huge potential lack of efficient marketing, shortage of inputs, variability of climate and other structural problem, the benefit the smallholder received is low. Thus, studying the factors determining market channel choice is very important to benefit the smallholder.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This work was supported by the Addis Ababa University.

Notes on contributors

Solomon Ketema

Solomon Ketema (Mr) is an academic staff member of the Department of Geography and Environmental Studies in Bule Hora University. He is a doctoral fellow at the Department of Geography and Environmental Studies at Addis Ababa University, Ethiopia. He holds a bachelor’s degree in Geography in 2006 from Jimma University and MA degree in Population and Socio-economic Development Planning 2013 from Adama Science and Technology University. His research focus includes agricultural value chain, livelihood, climate change, poverty and food security.

Tebarek Lika

Tebarek Lika (PhD) is an academic staff member of the Department of Geography and Environmental Studies at Addis Ababa University, Ethiopia. He is lecturer and researcher in the same university. His research focus includes agricultural value chain, livelihood, climate change, poverty and food security.