Cost–Benefit Efficiency and Factors for Marketing Channel Choices among Avocado Farmers in Rungwe District, Tanzania

Abstract

Avocado farming has grown into a significant agricultural industry in the Rungwe District, significantly contributing to the local economy. Improving market access for avocado farmers is essential to raising rural incomes and enhancing their standard of living. This paper aims to determine the most efficient avocado marketing channels and analyse the factors affecting marketing channel choices by avocado farmers in the Rungwe District. The study involved 196 smallholder avocado farmers and key informants. Data were collected through interviews, questionnaire surveys, and documentary reviews. Findings showed that the main avocado marketing channels used by farmers in the Rungwe District were categorized into brokers (90.3%) and local traders (9.7%). The local traders’ marketing channel was more efficient, with a price spread (per kg) of TZS 400 and a farmer’s share in consumers’ price of 75%. In comparison, the brokers’ marketing channel had a price spread of TZS 1300 and a farmer’s share in the consumer’s price of 48%, though it had a higher net price received by farmers (TZS 1200) than local traders (TZS 500). Findings from the multiple binary regression analysis indicated that the education level of the household head, farming experience, household size, farm size, access to market information, price, quantity of avocado purchased, mode of payment, and access to extension services had a significant influence on the choice of marketing channel. The findings recommend expanding avocado marketing channels and strengthening avocado farmers’ access to market information, extension, and credit services.