Abstract:
This study examined the profitability and marketing chain of rice in Kahama district, Shinyanga Region. The study was a cross sectional design. A total of 216 sample of farm households was selected by using simple random sampling from the 18 villages for the interview. Subsector mapping analysis was done to map rice value chain. Results indicate that there were a number of actors i.e. producers, middlemen, traders, millers, wholesalers, retailers and final consumers. Structure, conducts and performance in the rice market were analysed. Profits along the rice value chains were also computed. Analysis on the market structure shows that Herfindahl-Hirschman Index (HHI) computed from the three segments of collectors, wholesalers and retailers shows a strong competitive market structure existed in the rice market. Trade barriers analysis was done and the results shows that complexity in accessing finance and price fluctuation reduce the ability to participate in the market. The study also find that 77% of farmers store their paddy in places that can maintain its quality hence opportunity to have good prices. In addition it was found that 65.5% of the traders purchase rice through middlemen at fair price since they had price movements information in different markets before. Furthermore, regressional analysis model was used to determine socio-economic factors which affects profitability of farmers. Findings show that, trainings to household head on best practices on farming was statistically significant at P<0.05 and that it has ability to increase profit by Tsh 41 538 per hactare. The study recommends strengthening of market information system, improvements in the agricultural inputs provision systems to increase production, productivity and training on good agricultural practice to the farmers as well as key issues in marketing which will lead to sustainable paddy farming in the study area and other parts which are producing paddy in Tanzania.
