Price Determination of Non-timber Forest Products in Different Areas of South Africa

Abstract

A wide variety of factors can influence the price determination of non-timber forest products (NTFPs) in individual markets. However, there is little understanding of differences across multiple markets within a uniform macro context, or how they might vary between different types of NTFPs. Therefore, this study sought to determine the factors and rationale behind the setting of prices for selected NTFPs in 15 different areas of South Africa. The results showed that the pricing factors considered by sellers when setting the prices of NTFP varied with the type of NTFP being sold, type of market (home markets or urban markets) and the method used by the seller to procure the stock. Overall, transport costs, stock price, profit margin, time taken to collect or produce the product and market price were the widely used factors to determine prices for NTFPs. The marked variation in both markets and products show that there was no formal or certain price setting mechanism that was used by NTFP sellers establish the market prices of NTFPs, with price discovery being the most widespread.