Determinants of smallholder wheat commercialization in Lemo District of Hadiya Zone, Ethiopia

Abstract

AbstractAgricultural commercialization stimulates the economic growth of developing nations like Ethiopia. Wheat commercialization in Ethiopia is seen as one way of implementing agricultural transformation strategies to enhance the livelihoods of smallholder households. Despite the production potential and importance of wheat, the level of wheat commercialization and its determinants in the Central Ethiopia region have been unheeded, with prior studies primarily focusing on the Oromia region and northern Ethiopia. Therefore, this study aims to analyze the determinants of smallholder wheat commercialization in Lemo district, Hadiya zone, Central Ethiopia region. Both primary and secondary data sources were used, and 155 wheat producers were interviewed. The descriptive and inferential statistics, household commercialization index, and Tobit regression model were used to analyze the data. The results of the study indicated that 11%, 57%, and 32% of respondents were subsistence, semi-commercialized, and commercialized farmers, respectively. The overall intensity of wheat commercialization in Lemo District was 48.92%, which indicates that wheat commercialization is semi-commercialized. Besides, the model result revealed that wheat commercialization was significantly determined by the sex of the household head, household size, landholding, technology adoption, access to market information regarding inputs and output prices, credit utilization, and membership in cooperatives. Hence, commercialization policies need to be crafted to incorporate the implementation of family planning, promote gender-inclusive and market-oriented production, support technology adoption among farmers, offer market intelligence services, ensure the establishment of agricultural credit schemes, and increase the participation of farmers in cooperatives to improve smallholder wheat commercialization and their living standards.

Keywords

• Ethiopia
• household commercialization index
• smallholder
• Tobit regression model
• wheat commercialization