Structure Conduct and Performance of Milk Market in Sululta Woreda, Ethioipia

Abstract

This article investigated the structure conduct and performance of milk market in Sululta Woreda, using survey data for 2015/16. The study used the structure-conduct-performance model to determine the structure conduct and performance of milk market. Primary data was collected from randomly selected 150 milk producers and 40 traders. Concentration ratio and gross margin were used for this analysis. Following the four firms’ criteria of concentration ratio, Sululta Woreda milk market showed highly oligopolistic nature with concentration ratio of 87.16% which was dominated by four traders including dairy cooperative union and three processing plants. The maximum total gross marketing margin in the channels was about 54.55% and the highest producers’ share of consumers’ price was along producers – consumers’ market channel in channel VI. Therefore, the study recommends that promoting potentially collective organizations (groups of traders) which plays important role in reducing the level of oligopolistic nature of market should be in place. This should be coupled by strategies that improve competitiveness and efficiency of milk market.

Keywords: Milk market, Structure conduct performance, Concentration ratio, marketing margin