Smallholders’ vulnerability in the maize market: An analysis of marketing channels to improve the role of cooperatives in Benin

Abstract

Smallholder households in developing countries often face challenges related to market access. Despite being proposed as a potential solution, cooperatives in the north of Benin have reportedly failed to effectively address this issue. The alternatives channels used by smallholder famers and the factors that influence their choices remain unclear. This paper adopts a mixed approach, combining qualitative analysis with quantitative methods, particularly the multivariate probit model, to investigate the distribution channels of maize used by farmers in the Kandi district of Benin. The study aims to identify the current distribution channels of maize in Kandi and analyze factors that affect, smallholder producers choice of marketing channel. Initially, the study identified four primary channels for marketing maize—namely, collectors, wholesalers, brokers, and cooperatives—and producers typically commonly engage in multiple channels simultaneously. Subsequently, It becomes evident that factors such as age, cooperative membership, distance to market, reliance on informal credit, average maize bag prices, and the timing of sales significantly influence producers' selection of marketing channels. Interestingly, despite cooperatives offering comparatively higher prices, the majority of farmers opt for collectors due to the informal credit they provide and their practice of purchasing large volumes of maize bags at pre-agreed prices. In conclusion, enhancing joint-selling capabilities of cooperatives and establishing a credit provision business tailored to maize producers are identified as crucial steps. These measures aim to alleviate producers’ financial strain, diminish their dependence on collectors for credit, and bolster their bargaining power in the market.