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Thesis on Cattle Marketing SAINT MARY’S UNIVERSITY INSTITUTE OF AGRICULTURE AND DEVELOPMENT STUDIES GROSS MARGIN ANALYSIS OF CATTLE MARKETING IN WEST SHOA ZONE: A CASE STUDY OF GINCHI LIVESTOCK MARKET BY DEJENE TAKELE GEBISSA JULY, 2014 ADDIS ABABA, ETHIOPIA 1 GROSS MARGIN ANALYSIS OF CATTLE MARKETING IN WEST SHOA ZONE: A CASE STUDY OF GINCHI LIVESTOCK MARKET A THESIS SUBMITTED TO, SAINT MARY’S UNIVERSITY INSTITUTE OF AGRICULTURE AND DEVELOPMENT STUDIES IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF AGRICULTURAL ECONOMICS BY DEJENE TAKELE GEBISSA JULY, 2014 ADDIS ABABA, ETHIOPIA i DECLARATION I declare that this thesis entitled “Gross Margin Analysis of Cattle Marketing in West Shoa Zone: The Case of Ginchi Livestock Market” is my original work and has submitted for the partial fulfillment of MSc. Degree in Agricultural Economics. The study has not been presented for a degree fulfillment in any university and that all sources of data used for the thesis have been duly acknowledged. Name: Dejene Takele Gebissa Signature: ___________ Date: July, 2014 ii ENDORSEMENT As thesis research advisor, I hereby certify that I have read and evaluated this thesis prepared, under my guidance, by Dejene Takele entitled “Gross Margin Analysis of Cattle Marketing in West Shoa Zone: A Case Study of Ginchi Livestock Market.” I recommend that it be submitted as fulfilling the thesis requirement. ______________________ ______________________ Date: July, 2014 Advisor Signature iii EXAM APPROVAL SHEET SAINT MARY’S UNIVERSITY INSTITUTE OF AGRICULTURE AND DEVELOPMENT STUDIES As member of the Board of Examiners of the M.Sc Thesis Open Defense, we certify that we have read and evaluated the Thesis prepared by Dejene Takele and examined the candidate. We recommend that the Thesis be accepted as fulfilling the Thesis requirement for the Degree of Master of Science in Agricultural Economics. ________________________ __________________ Dean, Graduate Studies Signature ______________________________ _____________________ Advisor Signature ______________________________ _____________________ External Examiner Signature ______________________________ _____________________ Internal Examiner Signature iv ACKNOWLEDGEMENTS I am deeply grateful and indebted to my wife, Ms. Lelistu Tesfaye, who motivated me from the very reception of my inspiration to join this MSc program which has further extended to the moment of nowadays when I am about to finalize the thesis. Successful accomplishment of this program would have been very difficult without her generous sacrifice of compromising our income to the financial fee of the university. Unreserved thanks go to Dr. Milkesa Wakjira, my major advisor, for his kind and tireless devotion of invaluable time from the early design of the proposal to the final write-up of the thesis by adding constructive and ever teaching comments. The generous and comprehensive assistance of the staff members of Trade and Market Development Office of Gindeberat, Abuna Gindeberat, Jeldu, Ilfeta and Dendi districts, and the Revenue and Custom Authority of Addis Ababa city and Burayu town during data collection has unforgettable share to be appreciated for the betterment of the thesis. The willingness of the market participants of the respective districts; town and city to provide me with all the essential information during the interview initiated me to wholeheartedly deserve them special blessing. v CONTENTS DECLARATION............................................................................................................... ii ENDORSEMENT ............................................................................................................ iii EXAM APPROVAL SHEET .......................................................................................... iv ACKNOWLEDGEMENTS ............................................................................................. v TABLES .......................................................................................................................... viii APPENDECES .................................................................................................................. x ABSTRACT ..................................................................................................................... xii INTRODUCTION............................................................................................................. 1 1.1 Background of the Study ...................................................................................... 1 1.2 Statement of the Problem ..................................................................................... 2 1.3 Objectives of the Study ........................................................................................ 3 1.3.1 General Objective .......................................................................................... 3 1.3.2 Specific Objectives ........................................................................................ 3 1.4 Research Questions .............................................................................................. 3 1.5 Significance of the Study ..................................................................................... 4 1.6 Delimitation/Scope of the Study .......................................................................... 4 1.7 Organization of the Research Paper ..................................................................... 4 1.8 Limitations of the Study ....................................................................................... 4 REVIEW OF RELATED LITERATURE ..................................................................... 5 2.1 Definitions and Concepts of Cattle Marketing Gross Margin Analysis............... 5 2.1.1 Market and Marketing ................................................................................... 5 2.1.2 Marketing Price and Pricing Mechanism ...................................................... 5 2.1.3 Marketing Channels ...................................................................................... 6 2.1.4 Marketing Costs ............................................................................................ 7 2.1.5 Marketing Information .................................................................................. 7 2.1.6 Gross Marketing Margin ............................................................................... 8 2.2 Overview of the Cattle Production and Marketing System of the Study Area .... 9 2.3 Review of Empirical Studies of Marketing Margin ........................................... 11 vi RESEARCH METHODOLOGY .................................................................................. 13 3.1 Description of the Study Area ............................................................................ 13 3.2 Research Design ................................................................................................. 14 3.3 Population and Sampling Techniques ................................................................ 14 3.4 Types of Data and Tools of Data Collection ...................................................... 15 3.5 Procedures for Data Collection .......................................................................... 16 3.6 Data Analysis ..................................................................................................... 16 3.6.1 Descriptive Analysis ................................................................................... 16 3.6.2 Econometric Analysis ................................................................................. 17 RESULTS & DISCUSSION .......................................................................................... 22 4.1 Descriptive Results and Discussion ................................................................... 22 4.1.1 Socio-Demographic Characteristics of Sampled Households ..................... 22 4.1.2 Cattle Marketing Participants and Channels via Ginchi Livestock Market ......................................................................................................... 26 4.1.3 Quantity of Cattle Supplied and Marketed via Ginchi Livestock Market ... 35 4.1.4 Prices of Cattle and Slaughter Product Marketed via Ginchi Livestock Market ......................................................................................................... 39 4.1.5 Costs of Cattle and Slaughter Product Marketed via Ginchi Livestock Market ......................................................................................................... 43 4.1.6 Marketing Auction Duration, Mode of Transportation and Information System ......................................................................................................... 45 4.1.7 Cattle Marketing Margin and Profit Margin Analysis ................................ 47 4.1.8 Challenges and Opportunity of Cattle Marketing via Ginchi Livestock Market ......................................................................................................... 55 4.2 Empirical Results of Gross Marketing Margin .................................................. 57 CONCLUSIONS AND POLICY IMPLICATIONS .................................................... 61 5.1 Conclusions ........................................................................................................ 61 5.2 Policy Implications ............................................................................................. 62 REFERENCES ...............................................................................................................
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