Effects of collective action on market participation and food security among smallholder farmers in Msinga Local Municipality.

Abstract

Smallholder farmers have little to no access to lucrative markets due to poor infrastructure, lack of government services, market information, and higher transaction costs. The government, policymakers, and non-government organizations (NGOs) have identified collective action as a strategy to address smallholder farmers' market failures, which could ultimately improve their livelihoods, welfare, and household food security. However, there is low participation in collective action by smallholders. Therefore, this study aimed to contribute to literature about the impact of collective action on market participation and food security amongst smallholder farmers. Data was collected using a questionnaire survey from 243 randomly selected smallholder farmers in Msinga Local Municipality. The first objective explored the socio-economic factors that influence household decisions to join farmers’ groups and the intensity of participation by using descriptive statistics, Principal Component Analysis (PCA), and regression analysis. Logistic regression results revealed that age, gender, education, household size, farm size, off-farm income, and extension services had a positive statistically significant effect on farmers' decision to join farmers’ groups. Ordered probit model results indicate that age, household size, farm size, education, and perception about the effect on economic capital positively impact the intensity of participation. The second objective identified household factors influencing the decision to participate in the market and intensity of participation using the double hurdle model. The double hurdle regression results show that farmers’ groups, market information, training, income from livestock, and farm size had a positive and statistically significant effect on market participation. Distance to market had a negative effect on market participation. Farmers' groups, market information, and transaction costs significantly impacted the intensity of market participation. Lastly, the study explored the impact of market participation and collective action on smallholder farmers' food security status using logistic. The logistic model results indicated that gender, age, education, social grant, credit access, market participation, farm size, total livestock unit, and food expenditure positively and significantly impact household food security. Furthermore, the farmers’ groups had no impact on household food security status.

This study concludes that collective action has a positive effect on market participation, and in turn, market participation improves household food security status. This study recommends that before forming farmers' groups the government, and NGOs should educate farmers through workshops, training, and seminars about farmers' groups to ensure that they understand the impact of collective action on their livelihoods.