Primary Producers’ Cooperative as Marketing Strategy to Increase Income of Small Scale Farmers: A Case Study on Potato Seed Tuber Jeldu District of West Shewa Zone of Oromia, Ethiopia

Abstract

The study presents the role of primary producers’ cooperative as marketing strategy to increases small scale farmers income from their produce.  The primary data from Jeldu district of west Shewa zone of Oromia regional state was generated from 120 randomly selected small scale farm households. These randomly selected farm households were drown from two groups: seventy one of them were selected from cooperative members group and the rest forty nine of them were selected from non cooperative members of potato seed producers. The analysis was made using descriptive statistics and econometric model using STATA software version 10. Descriptive analysis made for income; which was generated from potato seed tuber marketing, shows differences among cooperative participants and non participants small scale farm households in potato seed tuber marketing. Heckman two stage models was employed to identify factors affecting participation in cooperative of small scale farm households and the extent of effects of these factors on gross income from potato seed tuber of participant. Accordingly, the result of  first stage Heckman two model shows that, family size, proximity to market centre, farming experience, land allocated for potato seed tuber and extension service were key determinants of choice of participation in primary producers’ cooperative. In the second stage of the two stage model, proximity to market, land allocated for potato seed tuber, family size and extension service were found to influence gross income of primary producers’ cooperative participants of small scale farm households. Therefore, policies intended to increase farmers’ access to market, developing and improving market infrastructures, strengthening exiting cooperatives, establishing and encouraging participation in primary producers’ cooperative and improving extension service system could be recommended to more increases income from their produce.

Keywords: potato seed tuber, potato and Heckman treatment model.