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Mekelle University College of Business and Economics Department of Cooperative Studies Analysis of the Performance of Local Hybrid Maize Seed Production and Marketing In Marwoled and Goshyie, Womberma and Yilmandensa woreda, Amhara, Ethiopia By: Solomon Abie A Thesis Submitted in Partial Fulfillment of the Requirements for the Master of Arts degree In Cooperative Marketing Advisor: Dr.Fetien Abay June, 2011 Mekelle, Ethiopia i Mekelle University College of Business and Economics Department of Cooperative Studies Analysis of the Performance of Local hybrid Maize Seed Production and Marketing In Marwoled and Goshyie, Womberma and Yilmanadensa woreda, Amhara, Ethiopia By: Solomon Abie A Thesis Submitted to in Partial Fulfillment of the requirements for The Master of Arts Degree In Cooperative Marketing Advisor: Dr. Fetien Abay June 2011 Mekelle, Ethiopia ii DECLARATION MEKELLE University College of Business and Economics Department of Cooperative Studies This is to certify that this thesis entitled “Analysis of the Performance of local hybrid Maize seed Production and Marketing in Marwoled and Goshyie, Womberma and Yilmanadensa Woreda, Amhara Region, Ethiopia” submitted in partial fulfillment of the requirements for the award of the degree of Master of Arts in Cooperative Marketing to the College of Business and Economics, Mekelle University, through the Department of Cooperative studies, done by Ato Solomon Abie (Id.No. PR008/02) is an authentic work carried out by him under my guidance. The matter embodied in this project work has not been submitted earlier for award of any degree or diploma to the best of my knowledge and belief. Name of the student: - Ato Solomon Abie Yimer, Signature _________ date__17 June 2011 Name of the Advisor: - Dr.Fetien Abay Signature _________ date__20 June 2011 _ iii ACKNOWLEDGMENTS It is not possible to thank all those people and institutions who have helped me in writing this thesis, but the following deserves a special mention. My special and sincere gratitude goes to my Advisor Dr, Fetien Abay, for her earnest and constructive comments starting from proposal writing to the completion of my research work. I would like to express my heart full appreciation to my instructor Pro.G.B. Pillai for his genuine advice and professional guidance during proposal preparation of the research I would like to express my heart full thanks for Federal Cooperative Agency and Amhara Cooperative Promotion Agency for their sponsoring. In addition, I am deeply grateful to all Amhara cooperative promotion Agency staff, especially RUFIP department, Ato Demeke Mekuria, Ato Wondmagegn Muche, Ato Amogne Mengstie, W/o Tigst Derbew, Ato Getnet Belayneh, Ato Fantahun Admasu, and Ato Mengistu Anleyie for their special support to accomplish this program. Moreover, my special thanks also go to Womberma and Yilmanadensa woreda office of Agriculture staff members for their cooperative and giving me the necessary information on my research work. My special thanks also go to BahirDar University LSB Project Coordinator Dr. Taddesse Dessalegn and his project team members and the team of Wagningen international, for covering and supporting this research work fund. Finally, my thanks go to my family and friends who supported and encouraged me throughout the research work. iv Table of Contents Contents Page Acknowledgement……………………………………………………………. ………............. iii Table of Contents…………………………………………………………………...……......... iv List of Tables …………...……………………………………………………………….......... ix List of Figures……………………………………………………………………………...........x Acronyms …………………………………………………………………..……………......... xi ABSTRACT ……………………………………………..………………… ………................xiii 1. Introduction……………………………………………………………….............1 1.1 Background…………………………………………………………………....................1 1.2 Statement of the Problem..................................................................................... .............3 1.3 OBJECTIVE......................................................................................................................4 1.4 Research questions.............................................................................................................4 1.5 Hypothesis..........................................................................................................................4 1.6 Significance of the study....................................................................................................5 1.7 Scope of the study..............................................................................................................5 1.8 Organization of the Thesis..................................................................................................5 2. Literature Review..............................................................................................6 2.1 Definition of Concepts and the Theoretical Framework.....................................................6 2.1.1 Concepts of seed...........................................................................................................6 2.1.2 Seed production.............................................................................................................6 2.1.3 Seed system.....................................................................................................................7 2.1.4 Formal seed system.......................................................................................................7 2.1.5 Informal seed system.................................................................................................. ..8 2.1.6 The nature of Ethiopian agriculture and seed systems..................................................8 2.1.7 Seed Development, Production and Distribution in Ethiopia.......................................9 2.1.8 The performance of formal seed system in Ethiopia.....................................................9 2.2 Maize.................................................................................................................................10 2.2.1 Hybrid maize seed Production and Distribution in Ethiopia........................................11 2.2.2 Hybrid Maize Seed Producers......................................................................................12 v 2.3 Seed industry structure.......................................................................................................12 2. 4 the role of quality control and certification.......................................................................13 2.5 Seed Regulation..................................................................................................................14 2.6 Seed Marketing...................................................................................................................14 2.6.1 Nature of seed marketing.............................................................................................14 2.6.2 Performance of the market...........................................................................................16 2.6.3 Structure of the market.................................................................................................17 2.6.4 Conduct of the market..................................................................................................17 2.6.5 Performance..................................................................................................................18 2.6.6 Methods of evaluating marketing performance............................................................18 2.6.6.1 Marketing Margins.................................................................................................19 2.6.6.2 Marketing Costs and Margins...............................................................................19 2.6.7 Marketing channels.....................................................................................................19 2. 7 Seed pricing policy...........................................................................................................20 2. 8 Process of price decision of certified Hybrid Maize Seed................................................20 2.9 Contract farming concept..................................................................................................21 2.10 Farmers’ perception towards contract farming................................................................22 2.11 Related empirical studies on merits and demerits of contract farming...........................23 2.12 An overview of the Role of Agricultural Cooperatives..................................................24 2.13 Partnership in Contract local hybrid maize seed production............................................25 2.14 Terms of contract agreement in the study area.................................................................27 2.15 The contractor’s responsibility includes...........................................................................27 2.15.1 The Seed producers’ responsibility includes...............................................................27 2.15.2 Other included agreements..........................................................................................27 2.15.3 Dispute resolution mechanism of the agreement.........................................................27 3. Materials and Methods................................................28 3.1 Site selection and description of the study area..................................................................28 3.1.1 Amhara
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