Commercialization level and determinants of market participation of smallholder wheat farmers in northern Ethiopia

Abstract

Wheat market participation improves the income and economic growth of many smallholder farmers in Ethiopia. Despite this, smallholder farmers are not enough to participate in the wheat market so that commercialization level is very low due to different factors. This study, therefore, identified the determinants of market participation of smallholder wheat farmers and measured its commercialization level in Northern Ethiopia. The data were collected from 190 randomly selected sample households using a structured questionnaire. Descriptive statistics and the double hurdle model were used to analyze the collected data. The descriptive result revealed that the average commercialization level of the sample wheat farmers was 10.26%. The model result showed that the age, educational level, current selling price, wheat market experience, access to market/information, off/none farm income, family size, market orientation, distance to all weather roads and land size allocated for wheat significantly affected the smallholder wheat farmers’ market participation. Therefore, a policy on improving market access (by improving market infrastructure, marketing facilities, and encouraging contract farming), farmers’ awareness on market (by farmers’ training), and productivity of land (using the best agronomic practice and improved technology) should be designed to enhance smallholder farmers’ commercialization level.