Abstract:
This study assesses the levels of market participation by smallholder maize and
groundnut farmers in the Upper West Region by estimating the factors that influence
the probability and intensity of participating in the maize and groundnut markets and
then identifying and ranking the constraints to marketing maize and groundnut. A
multi stage random sampling procedure was employed to select 400 farmers (200
maize and 200 groundnut farmers) from four agricultural districts in the region. A
semi-structured questionnaire was used to collect household survey data during the
2011 farming season. The Household Commercialisation Index was used to estimate
the levels of market participation and the Double Hurdle Model was used to estimate
the factors influencing both market participation and intensity of participation. The
Garrett ranking technique was used to rank the constraints to marketing. The results
indicated that about twenty-four percent and fifty-three percent of maize and
groundnut respectively are sold in the region within a production year which implies
low and moderate commercialisation indices for maize and groundnut respectively.
The results also indicated that farmer characteristics (such as age, gender, education,
household size); private assets variables (such as farm size, output, experience);
public assets variables (such as credit, extension contact, price); and transaction cost
variables (such as market information and point of sale) significantly influenced the
probability and intensity of market participation behaviour in the region. With respect
to the constraints to marketing, unfavourable market prices was the most pressing
constraint faced by farmers while lack of government policy on marketing was the
least constraint. The study concludes that maize is produced as a staple for household
consumption while groundnut is produced as a cash crop for the market. Based on the
findings, the study recommends that government through MoFA should institute
productivity enhancing measures to increase the productivity of maize and groundnut
as this would subsequently increase marketable surplus of farm households. It is also
recommended that MoFA should establish rural finance schemes to address the credit
needs of smallholders. The Statistics, Research and Information Directorate (SRID) of
MoFA should create a department responsible for the delivery of agricultural market
information to make market information delivery effective.
