Commercialization of smallholder farmer’s maize producer in Bilo Nopa district of Ilu Aba Bor zone, Oromia region, Ethiopia: market orientation and market participation

Abstract

Maize is one of the widely cultivated cereal crops in Ethiopia. Government recognizes importance of maize for economic development and emphasized its production and marketing in the strategies and policies for agricultural transformation. However, maize is mainly subsistent crop with very low marketed proportion. This study was set out to assess commercialization of smallholder maize producers. Crossectional data was collected from randomly selected 184 sample households using structured questionnaires. Statistical tool such as descriptive statistics, Tobit and Double hurdle models were used for data analysis. The result shows the degree of maize commercialization and market orientation was 29.97% and 10%, respectively. Tobit model shows that age, sex, education, family size and fertilizer use had positive while distant to the market had negative effect on smallholder maize producer‟s market orientation. Double-hurdle econometric model indicates that age, education, family size, extension contact, oxen and land allocated to maize production had positive effect while distance from market had negative effect on market participation decision., The intensity of maize sale was positively affected by age, education level, perception on lagged market price, number of oxen, embership to cooperative and land allocated to maize. The study indicates that level commercialization was low in the study area. Therefore, the strategies and policies aiming at promoting smallholders commercialization should be focused on improving provision of rural infrastructure, education, agricultural extension service, provision of inputs, institutional arrangement like cooperatives.