Assessment of efficiency in livestock markets in Tanzania: the case of primary livestock markets in Morogoro region
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Date
2009
Authors
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Publisher
Sokoine University of Agriculture
Abstract
This study assesses marketing efficiency of primary livestock markets in Morogoro
Region. A market survey of 120 livestock farmers and traders (wholesalers and
butchers) from Nanenane, Mkongeni, Melela, Parakuyo and Chakwale markets in
Morogoro Region was conducted to evaluate the structure, conduct and performance
of the markets. Two types of structured questionnaires one for the farmers and the
other for the traders were used to collect data. Informal interview of the key
informants, direct observation and secondary data from the key organizations in the
sector were also employed to complement the data. The data collected were analysed
using structure-conduct- performance model (SCP), gross margin (GM) and
regression analysis. SCP revealed that the livestock markets were perfectly
competitive and somehow vertically integrated, size of capital required served as the
barrier to market entry 91%. First- come/ first served was the buying/selling practice
in place, sales were through usual haggling over prices without weighing the
animals or standardization, livestock prices were set by farmers 56%. Producers
share was high 85.45% for cattle and 61.17% for sheep and goats (small ruminants).
The average marketing margins for wholesalers were 13.06% for cattle and 37.63%
for small ruminants, while for butchers were 13.89% for cattle and 32.39% for small
ruminants. All markets were efficient but cattle markets were more efficient than
small ruminants markets. GM analysis found that, cattle farmers got highest
economic profit per livestock sold and wholesalers were the last while for small
ruminants; wholesalers led in economic profit and farmers were the last. It is
therefore recommended that, district councils should use available media to avail
information about prices of livestock to the market participants, attract many buyers
to the markets, provide physical infrastructure in the markets areas, enforce a decree
on the use of weighing scales in all livestock markets and financial institutions
should support the sector through credit financing schemes.
Description
MSc-Thesis in agricultural Economics
Keywords
Livestock farmers, Livestock traders, Livestock markets, Primary livestock markets, Morogoro region, Tanzania