Smallholder wheat farmers’ commercialization level and its determinants in northwestern Ethiopia

Abstract

This study analyzes the commercial engagement of smallholder farmers in wheat commercialization at the farm level and the factors affecting this. A stratified three stage sampling technique was used to collect data from 195 smallholder wheat farmers. Descriptive and Tobit models were employed to analyze the collected data. The result of study identified that on average smallholder wheat farmers were relatively lacking in commercial activities as the mean commercialization index was found to be 0.21. The age category of a household head, quantity produced, distance to the nearest market, formal extension services, membership of farmers’ cooperatives, climatic (early warning and preparedness) information, and perception towards lagged market prices were found to determine significantly the commercialization activities of wheat farmers. The commercialization level of wheat farmers can be increased by improving their understanding of commercial farming, strengthening the marketing system (accesses and infrastructure), increasing the number of adequate extension contacts, timely climatic information, making market relationships (forward and future contract) available, and increasing farmers involvement in farming cooperatives.