Cereal Marketing and Household Market Participation in Ethiopia: The Case of Teff, Wheat and Rice

Abstract

Teff, wheat and rice are becoming important market oriented crops in Ethiopia. This study aims at analyzing the market participation of farm households, market actors, market channels and determinants of household market participation for these crops. Results are based on analysis of data collected from community and household surveys in three districts in three regional states of the country in 2005. Analysis of descriptive information and econometric analysis are used. About 65 - 77% of households produce these market oriented commodities, on about 27 – 44% of the total cultivated area. About 47 – 60% of the produce of these market oriented commodities is sold. The important market places for producers of these commodities are the district town markets and markets located at the peasant associations. Markets in other district towns or regional markets are not important for producers. Wholesalers and retailers are the most important buyers from producers. Average distance to market places for these commodities is about two walking hours. Econometric analyses showed that access to markets as measured by distance to market places does not have effect on market orientation of households in the study area. We find evidence of an U-shaped relationship between age of household head and market orientation of households in the cereal crops. Availability of cultivated land, traction power and household labor supply are important factors that induces households to be market oriented. The resource poverty of female headed households seems to detract from market orientation. While household size tends to favor food security objectives, number of dependents is associated with market orientation. Our results imply that improvements of markets to benefit producers need to be targeted at the district level. Improving the operations of factor markets of land, traction and farm labor could contribute to enhancing market orientation of farm households. Special attention is needed to female headed households to induce them to be market oriented.