Analysis of Coffee Market Chain in Abe Dongoro District of Oromia National Regional State: Ethiopia

Abstract

This study was aimed at analyzing the determinants of coffee market chain in Abe Dongoro districts of Oromia National Regional State among coffee producers. The data were collected from 160 farmers, 10 traders and 20 consumers and analyzed using descriptive and econometric approaches. The market chain analysis shown that the major actors in the district are coffee producers, collectors, retailers and consumers. It is also found out that coffee passes through several intermediaries with little value being added before reaching the end users. The chain is governed by collectors and retailers who have capital advantage over the other chain actors. Therefore, farmers are forced to capture a lower share of profit margin compared to retailers. The result of the multiple linear regression model indicated that market supply of coffee is significantly affected by access to extension service, amount of coffee produced and marketing price of coffee. Therefore, policy aiming at increasing farmers’ access to modern inputs, developing and improving infrastructure and improving extension system are recommended to accelerate the chain’s development.

Keywords: Coffee; Market Chain; Multiple Regression Model

DOI: 10.7176/DCS/9-12-02

Publication date: December 31^st 2019