Analysis of Factors Affecting Market Outlet Choices by Rice Cooperative Members in Zambia

B.Sc. Liberty Mubhau, BSc

Master's thesis

Abstract:

Improving access to the market by smallholder farmers in developing countries is crucial as a poverty alleviation strategy since 70 % of the rural population relies on agriculture for their livelihood. In most developing countries smallholder farmers are excluded from markets due to lack of transparency, poor market organization, long value chains, and poor policies by the respective governments. In Zambia, rice is produced mainly in Northern, Eastern, and Western provinces. Agriculture marketing in Zambia moved from the use of marketing boards to a liberalized and diverse system. This has given the farmer a wide variety of market outlets and understanding how they choose where to sell is important. The main objective of the study was to analyze the factors that influence the marketing decision of rice cooperative farmers in Zambia. A sample of 123 rice farmers was purposively selected using the snowballing technique in Limulunga and Mongu Districts. Descriptive statistics and ANOVA were used to describe the value chains and show the differences in prices in the market outlets. The multinomial logit model was used to analyze the factors influencing the market outlet choices. From the results, there were four marketing channels available to the farmers and these were cooperative, middlemen, farmgate, and spot market with the latter being the most utilized. There were also significant differences in the prices of the outlets with the cooperative offering the highest and the farmgate the lowest. The results of the regression model showed that education, age, access to training, access to extension services, access to input subsidies, time of payment, selling price of rice, access to market information, distance to market were statistically significant in affecting the marketing decision of the farmers.

Keywords

Mongu, Multinomial Logit Model, Utility Maximisation theory, Value Chain, Spot market

Language used: English

Date on which the thesis was submitted / produced: 23. 4. 2021

Thesis defence

• Supervisor: Ing. Jiří Hejkrlík, Ph.D.

Czech University of Life Sciences Prague

Faculty of Tropical AgriSciences

Master programme / field:
Tropical Agriculture / International Development and Agricultural Economics