An assessment of the maize structure, channel choice and market participation by the smallholder maize farmers in Zimbabwe: a case of Mazowe district.
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Date
2023
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Abstract
Marketing plays a crucial role in alleviating poverty, as well as in achieving food security and
sustainable development goals, especially among smallholder maize farmers. Maize marketing has
the potential to improve the resilience of households against food insecurity, which is caused by
multiple factors which may be natural factors, socio-economic and institutional factors. Smallholder
maize farmers find it difficult to participate in the maize market because of a range of limitations,
such as poor transport facilities, information asymmetry and the lack of a market infrastructure,
which reduces their motivation to partake and which may be echoed in concealed expenses that
make it challenging to enter the markets and productive resources. This study ascertained the
factors that determine the likelihood and intensity of smallholder maize farmers participating in the
maize markets, and it also assessed the market choices made by the smallholder farmers in the
Mazowe District of Zimbabwe and analysed the maize marketing structure and its effects on the
maize marketing performance. Questionnaires were used to collect data from 382 smallholder
farmers and 27 agro-dealers in the Mazowe District. The study adopted a mixture of tools for data
collection, including a questionnaire, observations and discussions. The Heckman Selection Model
was used as the main analytical tool to estimate market participation and the intensity of this
participation, while the Multinomial Logit Model was used to assess the market choices of the
farmers and the Herfindalf-Hirschman Index and Gini coefficients were used to measure the
concentration of maize traders in the Mazowe District. Due to the narrow index of the maize
marketing options in the country, only three distinct alternatives were isolated, namely, the farm
gate, the local market and the Grain Marketing Board (GMB), a government parastatal. The results
indicated the significant factors that were associated with the likelihood and intensity of the
farmers’ market participation, namely, the age of household head, the number of maize buyers at
the district level, their extension contacts, membership of a marketing association and the distance
to the output market. Contrary to the apriori expectations, the distance to the market had a positive
and significant impact on their intensity to participate in the maize market. Other factors that
significantly influenced the market choice selection of the smallholder farmers were the age of
household head, the extension contacts, market information, the distance to the market and the price
offered to maize producers at the market. The number of visits by extension workers significantly
increased the likelihood that a maize producer would sell his produce at the local market, rather
than at the farm gate. The distance to the market significantly influenced the probability of choosing
the local market over the farm gate. As the distance to the local market increases, the smallholder
farmers in the Mazowe District preferred the farm gate for selling their produce. In this study, the
popular marketing channel for the smallholder farmers was the farm gate; although the prices
offered here were often not competitive, the farmers opted for it because of the low transaction
costs. The results also indicated that the number of buyers in the maize grain market is too small to
make it competitive. The few traders exhibited collusive behaviour with regard to price-setting. The
local market channel and G.M.B had a lower Shepherd Marketing Efficiency Index. While both
indices were low, when they were compared to the standard in literature, the GMB channel was the
least efficient. Most farmers indicated that selling their grain to the GMB involved bureaucracy and
late payments, which have negatively affected the marketing efficiency. These late payments have
short-circuited the ability of small-scale farmers to generate a cash-flow with which to fund their
agriculture activities. The study recommends that there should be mechanisms for developing the
capacity of farmers to access marketing information, in order for them to make an informed
decision regarding which marketing channel to choose. Governments need to think about how to
help smallholder maize farmers to engage better with the existing profitable market channels. Being
a member of an association increases the probability of a farmer selling to more lucrative markets.
Farmer groups have the advantage of bulking and hence increasing the economies of scale. There is
need for farmers to invest more in collective action. It is also easier and cheaper for traders to
enforce quality and grade requirements by reaching farmers groups, rather than individual farmers.
Keywords: Heckman selection model, Market Participation, Smallholder farmer, Farm gate
Description
Doctoral Degree. University of KwaZulu-Natal, Pietermaritzburg.