Value chain analysis of tomato in kersa District of oromia, south western Ethiopia

Abstract

In Jimma zone of Oromia National Regional state, Tomato is a most important edible and nutritional vegetable crop, which is mainly produced by smallholder farmers. The study was to under taken with the specific objectives of identifying actors in tomato the value chain, analysing marketing margins; analysing factors affecting tomato supply and examining market outlet choice for selling tomato. The data were collected from both primary and secondary sources. The primary data for this study were collected from 129 farmers from four kebeles and 45traders through application of appropriate statistical procedures. Descriptive and econometric methods of data analyses were used. The study result showed that tomato producers are faced with lack of proper coordination among the value chain actors, shortage of education, farmers coordination, low price of product, limited access to extension contact, low bargaining power of producers, limited access credit, transport, market information, quality and post-harvest losses, lack of policy framework are the major problems. The value chain analysis revealed that the major actors in the Woreda are input suppliers, producers, brokers, collectors, wholesalers, retailers, consumers and supportive services. Tomato passes through several intermediaries with little value being added before reaching the end users. The chain is governed by wholesalers who have capital advantage over the other chain actors. Out Of total tomato producing households, 21.05% sold their tomato to collectors 25.3%, to retailers, 52.7% whole sellers and respectively. The net market margins in that participant are found out 605,175, 548, and 80. Finally trader on average took 61.04% of total profit margin. While farmers doing all the work of producing tomato and bearing the associated risk took only 38.96% of the profit margin. Therefore, farmers are forced to capture a lower share of profit margin. This unequal share of benefit is the reflection of power relationship among the actors. The ordinary least square regressions (OLS) model result shows that tomato commercial was significantly affected by five variables such as education level, current price, farm size, access to market information, and distance to market. Multivariate probit model result also indicate the probability to choose the wholesaler and collector outlet was significantly affected by household education, land size, distance to market, access to credit, access to extension, farmers cooperative membership and distance to the market. Therefore the strategy aim to, facilitating education level, enabling experience sharing habit of tomato farming (preparing conferences at least by selecting demonstration site), adequate market information by establishing technical committee among the sectors , fixing market place for producer with technical committees for establishing reasonable prices, land extension, developing access to credit, improving access extension and establishing capable farmer cooperative are a recommended issues