Profitability and Value Chain Assessment of Groundnut in Digga District of East Wollega Zone, Oromia National Regional State, Ethiopia
Agriculture, Forestry and Fisheries
Volume 8, Issue 4, August 2019, Pages: 81-88
Received: Jul. 16, 2018; Accepted: Aug. 15, 2019; Published: Aug. 30, 2019
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Authors
Oliyad Sori, Department of Agribusiness and Value Chain Management, Wollega University, Shambu, Ethiopia
Hika Wana, Department of Agricultural Economics, Wollega University, Shambu, Ethiopia
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Abstract
Marketing inefficiencies and low coordination of groundnut value chain are the main problems though Digga district is potential in groundnut production. The study was conducted to analyze the profitability and value chain assessment of groundnut in Digga district of Oromia region, Ethiopia. More specifically, the study identified value chain actors, their respective roles, maps the value chain, and assesses the performance of groundnut production in the area. Primary data were collected through a survey using pre-tested semi-structured questionnaire and through key informant interview using checklists and generated from randomly sampled 123 groundnut producers, 28 traders and 25 consumers. The major actors of groundnut value chain were: input suppliers, producers, traders, processors and consumers. Two-stage sampling procedure was employed to draw sample of groundnut producers. Digga districtwas selected purposively based on the potential it has for groundnut production in the zone. In the first stage, from kebeles which produce groundnut, 4 kebeles were randomly selected. In the second stage, 123 samples of household heads were randomly selected from total groundnut producers in the district and the sample households were drawn randomly from each kebele based on probability proportional to size sampling techniques. Producers’ highest gross marketing margin was 86.12% in channel III and highest total gross margin is 19.93% in channel IV while 13.88% is the lowest total gross margin in channel III. Cost incurred in groundnut production was 6588 Birr per Hectare and the gross income obtained from groundnut production was 9,600 Birr per Hectare and net income of the product was 3012 Birr per Hectare which shows groundnut production in Digga district is profitable. Opportunities and constraints of groundnut profitability and value chain were identified at each stage of value chain like input supply, production, processing, marketing and consumption of groundnut. The study recommended that farm machineries, improved seed of groundnut, market facilities and market outlets should be provided for farmers for insuring larger production and selling thereby to enhance profit of groundnut production in the study area.
Keywords
Groundnut, Profitability, Gross Margin, Digga
To cite this article
Oliyad Sori, Hika Wana, Profitability and Value Chain Assessment of Groundnut in Digga District of East Wollega Zone, Oromia National Regional State, Ethiopia, Agriculture, Forestry and Fisheries. Vol. 8, No. 4, 2019, pp. 81-88. doi: 10.11648/j.aff.20190804.11
Copyright
Copyright © 2019 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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