Performance of Soybean Marketing in Emby, Tharaka Nithi and Meru Countries, Kenya

Abstract

Current demand for soybean in Kenya exceeds supply despite numerous efforts by the government to increase production. Soybean farmers are faced with the difficulty in accessing the market reason for their reluctance in producing. Little is known about the soybean market in the central highlands of Kenya. This study was carried out with the aim to assess the structure conduct and performance of soybean markets in EmbuTharaka-Nithi and Meru Counties. Key informant interviews were carried out among soybean farmers’ groups, Ministry of Agriculture Livestock and Fisheries and soybean processing companies. A structured questionnaire was administered to processors, wholesalers, retailers and assemblers of soybean. Data was collected mainly on characteristics of respondents and marketing information. The collected data were used to calculate Herfindahl Hirschman Index (HHI), gross margins, marketing margin, and marketing efficiency. The results of the study showed that there were eight important marketing channels with channel 1 being the most efficient followed by channel 7, 3, 8, 4, 2, 6 and 5 respectively. The HHI showed that wholesalers were competitive (0.0997); retailers were relatively competitive (0.1701) while processors indicated an oligopolistic market structure with an HHI index of 0.18. Farmers groups, wholesalers and assemblers sold their soybean to processors at a fixed price (60ksh) given by the processors. Quantities traded were low with an average of 333.3kg for wholesalers, 793.33kg for assemblers and 47kg for retailers. There were no trader associations in the study area even though farmers engaged in group marketing. The study concluded that Constraints to marketing by farmers included low prices, lack of processing equipment’s, inadequate marketing arrangements, and high cost of processing.