Farmers’ preference for bundled input-output markets and implications for adapted dairy hubs in Tanzania – a choice experiment

E.J.O. Rao, N. Mtimet, E. Twine, I. Baltenweck and A. Omore

No 246961, 2016 Fifth International Conference, September 23-26, 2016, Addis Ababa, Ethiopia from African Association of Agricultural Economists (AAAE)

Abstract: Dairy business hubs present opportunities for efficiently linking farmers to input and output markets. Yet participation by smallholder dairy farmers in these hubs will only be realized if the hub options are adapted to fit the needs of farmers. In this study we have analyzed preference for dairy business hubs in Tanzania where ILRI is currently implementing adapted hub options. Using survey data from smallholder dairy producers from Tanga and Morogoro and applying the choice experiment method we find significant preference for hub options with higher milk prices and payment for milk on a fortnight rather than cash basis. Farmers also prefer hub options that bundle milk marketing with input provision. For bundled inputs, smallholder dairy farmers prefer hub options that allow payment for such inputs via credit or check-off rather than cash. Our analyses also reveal significant heterogeneity in preference among farmers hence the need for advanced analytical approaches that can handle such heterogeneity. Emerging dairy hubs in Tanzania should be supported to either establish in-house input provision arrangements or to enter into contracts with major agro-input dealers in their environs.

Keywords: Livestock Production/Industries; Marketing; Research and Development/Tech Change/Emerging Technologies (search for similar items in EconPapers)
Pages: 15
Date: 2016-09
New Economics Papers: this item is included in nep-agr and nep-dcm
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaae16:246961

DOI: 10.22004/ag.econ.246961

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