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Journal of Agricultural Economics and Development

Journal of Agricultural Economics and Development Vol. 5(2), pp. 020-032, February 2016 ISSN 2327-3151 ©2016 Academe Research Journals

 

Full Length Research Paper

Determinants of market participation and intensity of marketed surplus of teff producers in Bacho and Dawo districts of Oromia State, Ethiopia

Efa Gobena Tura1*, Degye Goshu2, Tinsae Demisie3 and Tadesse Kenea4

1Department of Agribusiness and Value Chain Management, Ambo University, Post code + 251 Box 19, Ambo, Ethiopia.

2School of Agricultural Economics and Agribusiness, Haramaya University, Post code + 251 Box 05, Haramaya University, Ethiopia.

3Department of  Agricultural Economics and Extension, Jimma University, Post code + 251 Box 307, Jimma, Ethiopia.

4Division of Logistics, Department of Energy and Technology, Swedish University of Agricultural Sciences, Post code: 75007, Box: 7032, Uppsala, Sweden.

*Corresponding author. E-mail: efagobena@gmail.com.

Accepted 3 January, 2016

Abstract

The vast majority of households in Ethiopia live in rural areas and agriculture is still the main economic activity. They rarely produce for the market and are highly dependent on climate for their subsistence. In this paper, the market options available to these farmers, as well as market related factors that are problematic were investigated. Multi-stage sampling procedure was employed to draw a sample of 150 teff producers. Double hurdle model was used to identify factors affecting market participation and intensity of marketed surplus of teff. Market participation of smallholder farmers was significantly affected by access to credit, perception of farmers on lagged market price of teff, family size, agroecology, farm size and ownership of transport equipment. The intensity of marketed supply was significantly influenced by family size, agroecology, distance to the nearest market, farm size, perception of current price, income from other farming and off-farm activity, and livestock holding. The findings generally suggest the need to create reliable market information, provide good transport facilities for farmers through development of infrastructure, strong extension intervention and giving training to farmers on marketing.

Key words: Marketed surplus, double-hurdle, probit 1.