DETERMINANTS OF MAIZE MARKET SUPPLY IN GURAGE ZONE: THE CASE OF CHEHA WOREDA

Abstract

Currently, maize is one of the cash crops and its demand by agro-industries has increased due to the increased capacity of maize processing in line with the expansion of the existing and establishments of new brewery plants. But little attention is paid to problems limiting the production and marketing condition, which in turn affect the market supply of maize. Hence, this study aimed to identify factors that affect market participation decision of households, determine factors affecting the quantity supply of maize in Cheha woreda. The study used both primary and secondary data. The primary data was gathered from 80 maize producing households by using random sampling technique and data also collected from farmers. To analyze the data both descriptive statistics and econometrics models was employed. Tobit model was used to identify factors affecting market participation decision of households and to determine factors affecting quantity supply of maize to the market in the study area. The Tobit model result revealed that out of 13 explanatory variables, 7 were found to significantly influence the quantity of maize supplied to the market amount of maize produced at 1% significance level, access to market information negatively influence at 5% significance level, market distance and current market price affected positively at 5% significance level. Whereas, distance to the market negative effect at 5% significance level, education at 10%, tropical livestock unit at 5% level of significance, extension contact influence at 1%. Both government and non-government actors give emphasis on linking farmers to different information sources to enhance farmers access to information on price, good husbandry practices, quality standard and market demand and also give attention for provision of improved seeds and fertilizer at the right manner in order to enhance production of maize