BAHIR DAR UNIVERSITY COLLEGE OF AGRICULTURE AND ENVIRONMENTAL SCIENCES GRADUATE PROGRAM MARKET CHAIN ANALYSIS OF WHEAT THE CASE OF DEBRE ELIAS WOREDA

BAHIR DAR UNIVERSITY
COLLEGE OF AGRICULTURE AND ENVIRONMENTAL SCIENCES GRADUATE PROGRAM
MARKET CHAIN ANALYSIS OF WHEAT THE CASE OF DEBRE ELIAS WOREDA, NORTH WESTERN ETHIOPIA
M.SC. THESIS RESEARCH
BY
MEZGEBU AYNALEM
DEPARTMENT: AGRICULTURAL ECONOMICS
PROGRAM: AGRICULTURAL ECONOMICS
MAJOR ADVISOR: FENTAHUN TESAFA (ASSISTANT PROFESSOR)
FEBRUARY, 2018
BAHIR DAR, ETHIOPIA

BAHIR DAR UNIVERSITY
COLLEGE OF AGRICULTURE AND ENVIRONMENTAL SCIENCES GRADUATE PROGRAM
MARKET CHAIN ANALYSIS OF WHEAT THE CASE OF DEBRE ELIAS WOREDA, NORTH WESTERN ETHIOPIA
M.SC. THESIS RESEARCH
BY
MEZGEBU AYNALEM
A THESIS SUBMITTED TO THE COLLEGE OF AGRICULTURE AND ENVIRONMENTAL SCIENCES OF BAHIR DAR UNIVERSITY IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF SCIENCE IN AGRICULTURAL ECONOMICS
FEBRUARY, 2018
BAHIR DAR, ETHIO
APPROVAL SHEETBahir Dar University
College of Agriculture and Environmental Sciences
Submitted by:
Mezgebu Aynalem ___________________ ______________
Name of student Signature Date
Approved by:
Fentahun Tesafa (Assistant Professor) _________________________
Name of Major Advisor Signature Date
As member of the Board of Examiners of the Master of Sciences (M.Sc.) thesis open defense examination, we have read and evaluated this thesis prepared by Mr (Mrs, Miss) Mezgebu Aynalem entitled “Market Chain Analysis of Wheat the case of Debre Elias Woreda, North Western Ethiopia”. We hereby certify that, the thesis is accepted for fulfilling the requirements for the award of the degree of Master of Sciences (M.Sc.) in Agriculture (Agricultural Economics).

Board of Examiners
_______________ _______________ _______________
Name of External Examiner Signature Date
____________________ _________________ _______________
Name of Internal Examiner Signature Date
____________________ _________________ _______________
Name of Chairman Signature Date
DECLARATION
This is to certify that this thesis entitled “MARKET CHAIN ANALYSIS OF WHEAT THE CASE OF DEBRE ELIAS WOREDA, NORTH WESTERN ETHIOPIA” submitted in partial fulfillment of the requirements for the award of the degree of Master of Science in “Agricultural Economics” to the Graduate Program of College of Agriculture and Environmental Sciences, Bahir Dar University by Mr. (Mrs., Miss) Name Mezgebu Aynalem (ID. No. 0906143) is an authentic work carried out by him under our guidance. The matter embodied in this project work has not been submitted earlier for award of any degree or diploma to the best of our knowledge and belief.
Name of the Student
Mezgebu Aynalem
Signature & date _____________________

Name of the Supervisors
1) _________________ (Major Supervisor)
Signature & date_____________________

2) __________________Co-Supervisor)
Signature & date_____________________
DEDICATEDThis Thesis manuscript is dedicated to my Beloved Mother W/ro Tiru Molla for nursing me with affection, unreserved assistance and for their dedicated encouragement in my academic carrier and life.

Name of the Student
Mezgebu AynalemSignature & date _____________________
BIOGRAPHICAL SKETCH
Mezgebu Aynalem was born in Yemizegn kebele Debre Elias Woreda, East Gojjam Zone of Amehar Regional State in October 1991. He attended his primary education at Yemizegn elementary school. He attended his secondary and preparatory school education at Debre Elias Secondary and Preparatory High School in East Gojjam zone.
After completion of his high school education, he joined Jimma University College of Agriculture and Veterinary Medicine (JUCAVM) in October 2012 and graduated with BSc. Degree in Agree Business and Value Chain Management in June 21/ 2014. Soon after his graduation, he was employed by Assistance Lecturer I at Debre Markos University Burie Campus. After two year experience the author joined Bahir Dar University College of Agriculture and Environmental Since in October 2016 to pursue of his MSc degree in Agricultural Economics in regular program.

ACKNOWLEDGEMENTSFirst and foremost, thanks to God with her mother, who gave me with his endless love and blessing in my life!!!
I would like to thank my advisor, Fentahun Tesafa (assistant professor), for his constant instruction, intellectual and technical comments, guidance and unreserved support from proposal development up to the completion of the thesis.
I would like to thank my sponsor Debre Markos Universities for financial support of both education and research study. My deepest gratitude goes to Bahir Dar University College of Agriculture and Environmental Sciences department of Agricultural Economics staffs for their friendly interaction, intellectual and technical comments, guidance and unreserved support from proposal development up to the completion of the thesis. I would like to thank all Debre Elias Agriculture and Rural Development offices for their permission and cooperation to use available data from Woreda offices and all sample respondents for this study. I am also indebted to my respondents for their patience in providing all the necessary information
My heartfelt thanks to my generous mother, Tiru Molla whose commitment and sacrifices bring me to this stage. Words fail to convey my deepest thanks to my brothers, Dessalegn Aynalem, Zenegnaw Aynalem, Fasica Aynalem, Mekuanet Aderaw and my sisters Hebrework Aynalem with her familys and Abayinesh Aynalem with her husband who have always been there for me whenever I need them; their encouragement keeps me going and their love empowers me.

TABLE OF CONTENTTOC o “1-4” h u APPROVAL SHEET PAGEREF _Toc513666167 h IDECLARATION PAGEREF _Toc513666168 h IIDEDICATED PAGEREF _Toc513666169 h IIIBIOGRAPHICAL SKETCH PAGEREF _Toc513666170 h IVACKNOWLEDGEMENTS PAGEREF _Toc513666171 h VTABLE OF CONTENT PAGEREF _Toc513666172 h VILIST OF TABLES PAGEREF _Toc513666173 h VIIILIST OF FIGURES PAGEREF _Toc513666174 h 10LIST OF APPENDICES PAGEREF _Toc513666175 h 11LIST OF ABBREVATIONS PAGEREF _Toc513666176 h 12ABSTRACT PAGEREF _Toc513666177 h 131. INTRODUCTION PAGEREF _Toc513666178 h 141.1. Background PAGEREF _Toc513666179 h 141.2. Statements of the Problem PAGEREF _Toc513666180 h 161.3. Objectives of the Study PAGEREF _Toc513666181 h 181.4. Scope and Limitations of the Study PAGEREF _Toc513666182 h 181.5. Significance of the Study PAGEREF _Toc513666183 h 192.LITERATURE REVIEW PAGEREF _Toc513666184 h 202.1. Definitions and Basic Concepts in Agricultural Market Chain Analysis PAGEREF _Toc513666185 h 202.1.1. Market, marketing, marketing system and agricultural marketing PAGEREF _Toc513666186 h 202.1.2. Marketing channels and market integration PAGEREF _Toc513666187 h 222.1.3. Market supply and marketable surplus PAGEREF _Toc513666188 h 232.2. Market Chain, Supply Chain and Value Chain Analysis PAGEREF _Toc513666189 h 232.3 .Methods of Evaluating Efficiency of Agricultural Marketing System PAGEREF _Toc513666190 h 242.3.1. Market structure PAGEREF _Toc513666191 h 242.3.2. Market conduct PAGEREF _Toc513666192 h 252.3.3. Market performance PAGEREF _Toc513666193 h 252.4. Methods of Evaluating Marketing Performance PAGEREF _Toc513666194 h 262.4.1. Marketing costs PAGEREF _Toc513666195 h 262.4.2. Marketing margins PAGEREF _Toc513666196 h 272.5. Fundamental Approaches to Study Marketing PAGEREF _Toc513666197 h 272.5.1. Functional approach PAGEREF _Toc513666198 h 272.5.2. Institutional /System approach PAGEREF _Toc513666199 h 282.5.3. Commodity approach PAGEREF _Toc513666200 h 282.5.4. Managerial approach PAGEREF _Toc513666201 h 282.6. Empirical Evidences on Determinants of Agricultural Market Supply PAGEREF _Toc513666202 h 293. RESEARCH METHODOLOGY PAGEREF _Toc513666203 h 313.1. Description of the Study Areas PAGEREF _Toc513666204 h 313.2. Methods of Data Collection PAGEREF _Toc513666205 h 323.3. Sample Size and Sampling Method PAGEREF _Toc513666206 h 323.4 Methods of Data Analysis PAGEREF _Toc513666207 h 343.4.1. Rapid market appraisal PAGEREF _Toc513666208 h 353.4.2. Analysis of structure, conduct and performance (S-C-P) of wheat market PAGEREF _Toc513666209 h 353.5. Analysis of Production and Marketing Supports PAGEREF _Toc513666210 h 393.6. Econometric Analysis PAGEREF _Toc513666211 h 403.6.1. Marketable supply analysis PAGEREF _Toc513666212 h 404.RESULTS AND DISCUSSION PAGEREF _Toc513666213 h 474.1 Descriptive Statistics PAGEREF _Toc513666214 h 474.1.1 Demographic and socioeconomic characteristics of households PAGEREF _Toc513666215 h 474.1.2 Household resource ownership PAGEREF _Toc513666216 h 494.2 Access to Markets and other Services PAGEREF _Toc513666217 h 504.3 Farm Inputs utilization PAGEREF _Toc513666218 h 544.4 Production, Storage and Marketing of Wheat PAGEREF _Toc513666219 h 564.5 Wheat Marketing Participants, their Roles and Linkages PAGEREF _Toc513666220 h 584.6 Demographic Characteristics of Traders PAGEREF _Toc513666221 h 604.6.1. Fixed assets and working capital of traders PAGEREF _Toc513666222 h 624.6.2. Traders financial resource ownership PAGEREF _Toc513666223 h 634.7 Wheat Market Channels PAGEREF _Toc513666224 h 644.8 Analysis of Structure, Conduct and Performance of Wheat PAGEREF _Toc513666225 h 664.8.1 Structure of the wheat market PAGEREF _Toc513666226 h 664.8.2 Conduct of wheat trading PAGEREF _Toc513666227 h 704.8.3 Analysis of market performance PAGEREF _Toc513666228 h 744.9 Analysis of Wheat Profitability PAGEREF _Toc513666229 h 764.9.1 Producers’ profitability analysis PAGEREF _Toc513666230 h 764.9.2 Profitability analysis of wheat traders PAGEREF _Toc513666231 h 784.10 Econometrics Model Results PAGEREF _Toc513666232 h 804.10.1 Determinants of market supply PAGEREF _Toc513666233 h 805. CONCLUSION AND RECOMMENDATION PAGEREF _Toc513666234 h 845.1. Summary and Conclusion PAGEREF _Toc513666235 h 845.2. Recommendations PAGEREF _Toc513666236 h 87REFERENCES PAGEREF _Toc513666237 h 89APPENDIX PAGEREF _Toc513666238 h 96
LIST OF TABLES TOC h z c “Table” Table 1: Total population and sample size of wheat producers PAGEREF _Toc514256711 h 32Table 2: Sample size of traders in their respective towns’gebeya PAGEREF _Toc514256712 h 33Table 3: measurement and hypothesized relationship of dependent and explanatory variables PAGEREF _Toc514256713 h 43Table 4: descriptive statistics of categorical variables PAGEREF _Toc514256714 h 46Table 5: descriptive statistics of continuous variables PAGEREF _Toc514256715 h 47Table 6: Farmers’ access to markets and other services PAGEREF _Toc514256716 h 50Table 7: Agricultural input used by wheat producers PAGEREF _Toc514256717 h 52Table 8: Area cultivated, production and productivity of wheat PAGEREF _Toc514256718 h 55Table 9: Type of storage facility, purpose and length of storing wheat PAGEREF _Toc514256719 h 56Table 10: Demographic characteristics of traders PAGEREF _Toc514256720 h 59Table 11: Traders fixed assets and financial resource ownership PAGEREF _Toc514256721 h 60Table 12: Concentration ratio of top four traders PAGEREF _Toc514256722 h 66Table 13: Average number of markets visited by traders per week PAGEREF _Toc514256723 h 70Table 14: Marketing margins of wheat production in different channels PAGEREF _Toc514256724 h 73Table 15: Cost structures and profitability of sample farmers (N= 154) PAGEREF _Toc514256725 h 74Table 16: Analysis of profitability of wheat traders (Br/Q) PAGEREF _Toc514256726 h 77Table 17: OLS estimation results of Determinants of volume of wheat marketed supply. PAGEREF _Toc514256727 h 80

LIST OF FIGURES TOC h z c “Figure” Figure 4.1: wheat marketing channels PAGEREF _Toc514058879 h 65Figure 4.2: Producers Price setting strategy PAGEREF _Toc514058880 h 70Figure 4.3: traders selling price PAGEREF _Toc514058881 h 72Figure 4.4: payment mode sample traders sold their product PAGEREF _Toc514058882 h 73
LIST OF APPENDICES TOC h z c “Equation” Appendix Table 1. Conversion factors used to compute tropical livestock units PAGEREF _Toc514058883 h 95Appendix Table 2Asset ownership of farmer respondents PAGEREF _Toc514058884 h 95Appendix Table 3. VIF for Multi collinearity test PAGEREF _Toc514058885 h 96Appendix Table 4. Endogeneity test PAGEREF _Toc514058886 h 97Appendix Table 5. Specification test (ovtest) PAGEREF _Toc514058887 h 97Appendix Table 6. Correlation coefficient of wheat variables PAGEREF _Toc514058888 h 98Appendix Table 7 research questioners PAGEREF _Toc514058889 h 99
LIST OF ABBREVATIONSADFAugmented Decky Fuller
ADLI Agricultural Development Led Industrialization.

ANRSAmhara National Regional State
CSA Central Statistics Agency
CR Concentration Ratio
DEWOADebre Elias Woreda Office of Agriculture
DEWOFEDDebre Elias Woreda Office of Finance and Economic Development
KII Key Informant Interviews
FGDFocus Group Discussions
EAAPP Eastern Africa Agricultural Productivity Project
DEWoADebre Elias Woreda Office of Agriculture
PAs Peasant Associations
RDoA Rural Development and Office of Agriculture
RMA Rapid Market Appraisal
S-C-P Structure Conduct and Performance
SMESmall and Micro Enterprises
TGMM Total Gross Marketing Margin
NMM Net Marketing Margin
VCRValue-Cost Ratio
ABSTRACTThis research attempted to analyze the market chain of wheat in Debre Elias specifically aims to assess the production and marketing support service of extension, input supply, credit and marketing, analyze the market structure-conduct-performance of wheat, analyze profitability of wheat production and identify factors affecting wheat market supply. To collect primary data, 154 wheat producers and 31 traders were selected using simple random sampling method. To address the objectives of the study, descriptive statistics and econometric models were employed. Multiple linear regression models were employed to analyze determinants of wheat market supply. The result indicated that Debre Elias wheat market was inefficient, characterized by oligopolistic market structure. The major barrier to enter into the market was shortage of capital. Licensing and years of trading experience did not hinder entry into wheat trading activities. Moreover, the markets were overwhelmed by information asymmetry with low degree of market transparency. Although trading of wheat is profitable across all sample farmers and traders, problems like oligopolistic market structure and information asymmetry made the trading business uncompetitive and inefficient. Among the different variables hypothesized to determine the supply of wheat, six variables had statistically significant effect to predict wheat supply. These are: access to market information, lag price, extension contact, access to credit service, quantity produced of wheat and size of land allocated for wheat production. The study recommends that policy makers improve wheat production capacity by identifying new technologies create stable demand for surplus production would enhance farmers’ decision in marketable surplus. Strengthening the existing extension system through training in a way to serve grassroots level producers in all aspect is important. The number of farmers and traders who accessed credit is very limited and higher interest rate; therefore, financial institutions should design a mechanism to address the challenges of financial access to smallholder farmers and traders.
Keywords: Market Chain, Wheat, structure, conduct and performance and Multiple Regression, oligopoly,
1. INTRODUCTION1.1 BackgroundThe agricultural sector is the most important sector in the Ethiopian economy that features strongly in the overarching economic policy of the country – agricultural development led industrialization (ADLI). It serves as source of income and employment for the majority of the country’s population. Agriculture also contributes over 45% to the national GDP, almost 90 percent of export and 85 percent of employment (MoARD, 2010).
Wheat (Triticum aestivum L.) is one of the most important grain crops used in the world. Among the world cereal crops, it ranks first accounting 30 % of all cereal food in the world and is a staple food for more than 10 billion people in the world (Yadav ; Dhanai, 2017). According to the MoARD (2010), wheat is produced largely in southeast, central and northwestern parts of the country. Small amounts are produced in the rest of north and southern regions.
Ethiopia is the second largest producer of wheat in sub-Saharan Africa following South Africa, about 1.61 million hectare of land is cultivated for both bread and durum wheat production under rain fed conditions. In area of production, Wheat ranks 4th after teff, maize, and sorghum; 3rd in total grain production after Maize and Teff and 2nd in yield next to Maize (Assefa et al., 2015). About 60 and 40% of the wheat area is covered by bread and durum wheat, respectively (Assefa et al., 2015). Wheat is one of the most important small cereal crops in Ethiopia widely cultivated in wide range of altitudes. Wheat growing areas in Ethiopia are situated between 6-16o N latitude and 35-42oE longitudes at altitude ranging from 1500 to 3000 m.a.s.l, however, the most suitable agro-ecological zones of wheat fall between 1900 and 2700 masl ADDIN EN.CITE ;EndNote;;Cite;;Author;Kotu;/Author;;Year;2000;/Year;;RecNum;3;/RecNum;;DisplayText;(Bekele Hundie Kotu;style face=”italic”; et al.;/style;, 2000);/DisplayText;;record;;rec-number;3;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;3;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Kotu, Bekele Hundie;/author;;author;Verkuijl, Hugo;/author;;author;Mwangi, WM;/author;;author;Tanner, DG;/author;;/authors;;/contributors;;titles;;title;Adoption of improved wheat technologies in Adaba and Dodola Woredas of the Bale Highlands, Ethiopia;/title;;/titles;;dates;;year;2000;/year;;/dates;;publisher;CIMMYT;/publisher;;isbn;9706480633;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Bekele Hundie Kotu et al., 2000). According to ADDIN EN.CITE ;EndNote;;Cite;;Author;Aleminew;/Author;;Year;2015;/Year;;RecNum;5;/RecNum;;DisplayText;(Amare Aleminew;style face=”italic”; et al.;/style;, 2015);/DisplayText;;record;;rec-number;5;/rec-number;;foreign-keys;;key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″;5;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Aleminew, Amare;/author;;author;Alemayehu, Getachew;/author;;author;Adgo, Enyew;/author;;author;Herrero, VF;/author;;/authors;;/contributors;;titles;;title;Response of noug (Guizotia abyssinica Cass.) to Np fertilizers application and seeding rates on yield and yield components in Ebinat District, Amhara Region, Ethiopia;/title;;secondary-title;World Journal of Agricultural Sciences;/secondary-title;;/titles;;periodical;;full-title;World Journal of Agricultural Sciences;/full-title;;/periodical;;pages;70-83;/pages;;volume;11;/volume;;dates;;year;2015;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Amare Aleminew et al., 2015), bread wheat in Ethiopia used as a source of food, cash and the straw used as thatching and animals’ feed.
According to ADDIN EN.CITE <EndNote><Cite><Author>Aleminew</Author><Year>2015</Year><RecNum>5</RecNum><DisplayText>(Amare Aleminew<style face=”italic”> et al.</style>, 2015)</DisplayText><record><rec-number>5</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>5</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Aleminew, Amare</author><author>Alemayehu, Getachew</author><author>Adgo, Enyew</author><author>Herrero, VF</author></authors></contributors><titles><title>Response of noug (Guizotia abyssinica Cass.) to Np fertilizers application and seeding rates on yield and yield components in Ebinat District, Amhara Region, Ethiopia</title><secondary-title>World Journal of Agricultural Sciences</secondary-title></titles><periodical><full-title>World Journal of Agricultural Sciences</full-title></periodical><pages>70-83</pages><volume>11</volume><dates><year>2015</year></dates><urls></urls></record></Cite></EndNote>(Amare Aleminew et al., 2015), currently wheat is one of the major cereals of choice in Ethiopia, dominating food habits and dietary practices, and is known to be a major source of energy and protein for the highland population of the country. In spite of its tremendous importance, wheat production in Ethiopia faced large production constraints that are affecting both its economic and straw yield. Moreover, wheat has been selected as one of the target crops in the strategic goal of attaining national food self-sufficiency. It is also known in several countries of the world, that wheat provides more human nourishment than any other food source. But, Inefficiency of domestic agricultural markets is mentioned as one of the detrimental factors for the reduced productivity of farmers and for the poor performance of the agricultural sector in the developing countries. This conviction has led towards sweeping policy reforms in the developing countries since the early 1980s (Gabre Madhin, 2001). According to ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Roduner</Author><Year>2004</Year><RecNum>6</RecNum><DisplayText>Daniel Roduner (2004)</DisplayText><record><rec-number>6</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>6</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Roduner, Daniel</author></authors></contributors><titles><title>Report on Value Chains: Analysis of existing theories, methodologies and discussions of valuechain approaches within the development cooperation sector, prepared for SDC by DanielRoduner</title><secondary-title>Swiss Centre for Agricultural Extension and Rural Development (AGRIDEA)</secondary-title></titles><periodical><full-title>Swiss Centre for Agricultural Extension and Rural Development (AGRIDEA)</full-title></periodical><dates><year>2004</year></dates><urls></urls></record></Cite></EndNote>Daniel Roduner (2004) several factors affect market orientation of households by affecting the conditions of commodity supply and demand, factor and output prices, and marketing costs and risks faced by producers, traders and other market actors.

Wheat is also one of the most important cereal crops in the Amhara National, Regional State (ANRS) used in different forms such as bread, porridge, and roasted grain. Besides to the grain, the straw of bread wheat is used for animal feed, thatching roofs and bed decking. North western Ethiopia in general and Gojjam Zone in particular are among the important wheat growing area of Ethiopia ADDIN EN.CITE <EndNote><Cite><Author>Ashagrie</Author><Year>1999</Year><RecNum>5</RecNum><DisplayText>(Yeshanew Ashagrie &amp; Asgelil Dibabe, 1999)</DisplayText><record><rec-number>5</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>5</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Ashagrie, Yeshanew</author><author>Dibabe, Asgelil</author></authors></contributors><titles><title>The effect of green manuring and application of fertilizer on the yield of bread wheat at Adet in North-Western Ethiopia</title></titles><dates><year>1999</year></dates><urls></urls></record></Cite></EndNote>(Yeshanew Ashagrie & Asgelil Dibabe, 1999) are considered as potential area for expansion of bread wheat.
Although the country has an immense potential for increasing domestic production to the extent that meets the current rapid demand for wheat, it has also faced a number of challenges constraining intensification, production and quality of wheat. These include weak seed production and distribution, high seed cost, high fertilizer cost, inadequate coordination between research, seed multiplication and extension, lack of market information, high transport costs, lack of access to appropriate storage and marketing facilities and poor infrastructure and shortage of access to bank credit ADDIN EN.CITE <EndNote><Cite><Author>EAAPP</Author><Year>2012</Year><RecNum>6</RecNum><DisplayText>(EAAPP, 2012)</DisplayText><record><rec-number>6</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>6</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>EAAPP </author></authors></contributors><titles><title> Wheat Baseline Survey Report Wheat Regional Center of Excellence (WRCoE), Addis Abeba, Ethiopia.</title></titles><dates><year>2012</year></dates><urls></urls></record></Cite><Cite><Author>EAAPP</Author><Year>2012</Year><RecNum>6</RecNum><record><rec-number>6</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>6</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>EAAPP </author></authors></contributors><titles><title> Wheat Baseline Survey Report Wheat Regional Center of Excellence (WRCoE), Addis Abeba, Ethiopia.</title></titles><dates><year>2012</year></dates><urls></urls></record></Cite></EndNote>(EAAPP, 2012). Furthermore, poor farming management and post harvesting handling is also among the major problems. Low labor productivity, soil degradation, erratic rainfall, land tenure insecurity and fragmentation, weak research base and extension system, lack of financial services, imperfect agricultural market and poor infrastructure ADDIN EN.CITE <EndNote><Cite><Author>Degefe</Author><Year>2000</Year><RecNum>6</RecNum><DisplayText>(Bekekadu Degefe &amp; Berhanu Nega, 2000)</DisplayText><record><rec-number>6</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>6</key></foreign-keys><ref-type name=”Book”>6</ref-type><contributors><authors><author>Degefe, Bekekadu</author><author>Nega, Berhanu</author></authors></contributors><titles><title>Annual Report on the Ethiopian Economy: 1999/2000</title></titles><dates><year>2000</year></dates><publisher>Ethiopian Economic Association</publisher><urls></urls></record></Cite></EndNote>(Bekekadu Degefe & Berhanu Nega, 2000). According to ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Emana</Author><Year>2010</Year><RecNum>7</RecNum><DisplayText>Bezabih Emana (2010)</DisplayText><record><rec-number>7</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>7</key></foreign-keys><ref-type name=”Generic”>13</ref-type><contributors><authors><author>Emana, Bezabih</author></authors></contributors><titles><title>Market Assessment and value chain analysis in BeneshangualGumuze</title></titles><dates><year>2010</year></dates><publisher>Ethiopia</publisher><urls></urls></record></Cite></EndNote>Bezabih Emana (2010), All this importance, agriculture continues to face a number of problems and challenges. The major ones are adverse climatic conditions, lack of appropriate land use system resulting in soil and other natural resources degradation, limited use of improved agricultural technologies, the predominance of subsistence agriculture and lack of and/or absence of business oriented agricultural production system, limited or no access to market facilities resulting in low participation of the smallholder farmers in value chain.
1.2 Statements of the ProblemAgricultural marketing is the main powerful force of economic development and has a guiding and suggesting impact on production and distribution of agricultural produce. The agricultural marketing system takes on an increasing importance specially for the traditional agrarian economies, like Ethiopia that has implemented several development policies & strategies and programs following Agriculture Development Led Industrialization (ADLI) as an overarching policy to transform its economy focusing on the industrial sector as the driver to achieve a vision of becoming one of the middle income countries by 2025. Moreover, the increasing proportion of the population living in urban centers and the rising level of income requires more highly organized channels for processing and distributing agricultural products (Gabre Madhin, 2005).

For the industrial sector and more importantly the agro-processing industry to play its expected role in the growth and development of Ethiopian economy, there has to be a supply of adequate amount of raw materials consistently at competitive (reasonable) prices. Studies and our experiences indicated that one of the challenges for the agro-processing industry (demand side) is limited access to raw material supplies in terms of quantity, quality, and delivery time. In contrast, farmers (supply side) still faced the problem of lack of potential markets absorbing their agricultural produces with remunerable prices, which in turn would be serving as an incentive for them to carry out their production effectively and efficiently even as to the extent to meet needs of the agro-processing industry. This challenge that happened both from the demand and supply side is due to the fact that the Ethiopian agricultural output markets are characterized by inadequate transport network, limited number of traders, with inadequate capital facilities, high handling costs, inadequate market information system, and weak bargaining power of farmers and underdeveloped industrial sectors ADDIN EN.CITE <EndNote><Cite><Author>Haji</Author><Year>2008</Year><RecNum>8</RecNum><DisplayText>(Jema Haji, 2008)</DisplayText><record><rec-number>8</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>8</key></foreign-keys><ref-type name=”Book”>6</ref-type><contributors><authors><author>Haji, Jema</author></authors></contributors><titles><title>Economic efficiency and marketing performance of vegetable production in the eastern and central parts of Ethiopia</title></titles><volume>2008</volume><number>17</number><dates><year>2008</year></dates><isbn>9185913502</isbn><urls></urls></record></Cite></EndNote>(Jema Haji, 2008). Usually farmers in Ethiopia focused more on the production part without having priori, adequate market information about the demand for their products. Moreover, the national agricultural research and extension systems focused on enhancing production and productivity of the common/major crops without giving due emphasis for marketing related issues and processing quality of the crops like wheat that has a potential to enter the agro-processing industries. Recognition of the critical role of markets in economic development led to sweeping market reforms across a number of developing countries. In spite of these reforms, symptoms of poorly functioning markets in much of Sub -Saharan Africa are evident in the segmentation of markets, low investment in the market infrastructure, the persistence of high margins and of the market thinness and the limited progression toward more complex arrangements (Gabre Madhin, 2001).

Besides, having unique features of agricultural products by their nature (such as bulkiness, perishable, irregular supply, varied quality and seasonality producers) need the main actors along the market chain to have the necessary infrastructure to keep quality and reduce post-harvest loss of a product until it reaches to the final consumer.

Although it has shown an increasing trend, wheat production in the study woreda is characterized by relatively subsistence mode. Although the proximity of the Woreda to various urban centers (like Debremarkos, Adis Abeba, Bahirdar and Dejjen) makes the woreda to have a comparative advantage to get potential markets with better prices, the farmers couldn’t yet reap the benefits from wheat business as expected. This fact indicates that the price of wheat is highly fluctuating (DEA, 2016), and this in turn resulted from lack of appropriate market infrastructure that can create linkage and information flow in a regular manner among these potential markets. That is, the storage facilities, transportation, linkages with traders, quality controlling mechanisms, market information, and price settings seem weak in the study area to reach the smallholder farmers dispersedly populated at various villages of the woreda. This needs further investigation to be carried out thoroughly for analyzing the situations and prospects of wheat marketing chain and thereby suggest alternative solutions for developing the chain that will enable the primary producers (farmers) as well as other marketing agents to derive optimum benefits for their involvement in the wheat business accordingly. Thus, this study in general is proposed aiming to address such marketing related issues specifically considering the socio-economic characteristics of Debre Elias woreda. In addition, this thesis attempts to address the prevailing information gaps on the subject matter and contribute to proper understanding of the challenges that help devise improved market development strategies benefiting smallholder farmers, traders, and other market participants.
1.3 Objectives of the Study1.3.1 General objective
The general objective of this study is to analyze the market chains of wheat in Debre Elias woreda
1.3.2 Specifically objectives
assess the production and marketing support services of extension, input supply, credit and marketing;
analyze the structure-conduct-performance of wheat markets;
analyze profitability of wheat production;
identify factors affecting wheat supply to the market in the study area;
1.4 Research Question
What are the key supporting institutions along the wheat market chain and to what extent they are serving producers and other marketing actors?
How marketing system is organized, functioning and performing?
How profitable is the wheat production for producers? and
What are the factors that determine the marketed surplus of wheat in the study area?
1.5 Scope and Limitations of the StudyThis study focused on the overall marketing chain analysis of wheat in Debre Elias woreda and regional intermediate markets. The marketing chain (including major actors/channels such as, producers, farmer traders, rural retailers, urban assemblers, cooperatives, unions, wholesalers and processors) was assessed in relation to the different marketing mix in the production and marketing of wheat, analyze profitability of wheat production, analyzing wheat market conduct-structure-performance, and identify factors affecting of wheat supply to the market in the study area.

The study was restricted to the market chain analysis of wheat production in the woreda. In addition, the shortage of logistics and budgets made the researcher unable to consider additional sample of wheat producing kebeles and other neighboring markets found in and out of the study area.

1.6 Significance of the StudyThis study focuses on information on the factors of wheat supply, credit condition, marketing margin and profitability of wheat production and marketing in these areas. The information could help farmers, traders and others, who need it for different purposes.

It is also expected to suggest strategies for smooth integration between production and marketing by referring to root causes for supply and marketing problems starting from production till consumption of the product. The other benefit that could be anticipated is that its significance as a source for further studies, which could be a major input to formulate appropriate marketing policies and procedures.

LITERATURE REVIEWThis section attempts to provide a basic definition of a market, marketing, marketing system, market channels, marketing margin, market integration, agricultural marketing, marketable surplus and supply, supply chain and market chain, fundamental approaches to marketing, and methods to evaluate markets, identifying the factors affecting the market supply and methods of evaluating the efficiency of agricultural markets.

2.1 Definitions and Basic Concepts in Agricultural Market Chain Analysis2.1.1 Market, marketing, marketing system and agricultural marketingMarket: The term market has got a variety of meanings. In some cases market is an area in which one or more sellers of a given product/service and its close substitutes exchange with and compete for the patronage of a group of buyers. The earliest literatures defined the term market as the place where buying and selling takes place, an area in which a good is sold, a group of people carrying on buying or selling, or the commodity traded ADDIN EN.CITE ;EndNote;;Cite;;Author;Larson;/Author;;Year;1957 ;/Year;;RecNum;2;/RecNum;;DisplayText;(Larson, 1957 );/DisplayText;;record;;rec-number;2;/rec-number;;foreign-keys;;key app=”EN” db-id=”eaarzdwvlvf0vwew0f8p0xwtzxssw5ew9ved”;2;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Larson;/author;;/authors;;/contributors;;titles;;title;Agricultural marketing. Prentice- Hall. New York, USA.;/title;;/titles;;dates;;year;1957 ;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Larson, 1957 ). It is a place or sphere within which price making forces operate and exchanges of title tend to be accompanied by the actual movement of the goods affected (Backman ; Davidson, 1962). In line with this, ADDIN EN.CITE ;EndNote;;Cite;;Author;Marketing;/Author;;Year;2005;/Year;;RecNum;11;/RecNum;;DisplayText;(Westlake Michael-Addressing Marketing, 2005);/DisplayText;;record;;rec-number;11;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;11;/key;;/foreign-keys;;ref-type name=”Generic”;13;/ref-type;;contributors;;authors;;author;Marketing, Westlake Michael-Addressing;/author;;/authors;;/contributors;;titles;;title;Processing Constraints that Inhibit Agrifood Exports;/title;;/titles;;dates;;year;2005;/year;;/dates;;publisher;FAO;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;(Marketing, 2005) defined markets are places where buyers and sellers come together to trade. They are social arrangements that allow buyers and sellers to obtain information and exchange commodities. Others defined market as an institution within which the forces of demand and supply operate; sellers and consumers are in constant communication and there is change of title to goods and/or services ADDIN EN.CITE ;EndNote;;Cite;;Author;Kilungo;/Author;;Year;2001;/Year;;RecNum;12;/RecNum;;DisplayText;(Julius K Kilungo;style face=”italic”; et al.;/style;, 2001);/DisplayText;;record;;rec-number;12;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;12;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Kilungo, Julius K;/author;;author;Kavoi, Muendo M;/author;;author;Mairura, Zacharia;/author;;author;Kariuki, Joseph G;/author;;author;Muturi, Stachys N;/author;;/authors;;/contributors;;titles;;title;Marketing of smallholder produce: A synthesis of case studies in the highlands of central Kenya;/title;;/titles;;dates;;year;2001;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Kilungo et al., 2001).

According to ADDIN EN.CITE ;EndNote;;Cite AuthorYear=”1″;;Author;Ashenafi;/Author;;Year;2010;/Year;;RecNum;3;/RecNum;;DisplayText;Amare Ashenafi (2010);/DisplayText;;record;;rec-number;3;/rec-number;;foreign-keys;;key app=”EN” db-id=”eaarzdwvlvf0vwew0f8p0xwtzxssw5ew9ved”;3;/key;;/foreign-keys;;ref-type name=”Thesis”;32;/ref-type;;contributors;;authors;;author;Ashenafi, Amare;/author;;/authors;;/contributors;;titles;;title;Analysis of Grain Marketing in Southern Zone of Tigray Region, Ethiopia;/title;;/titles;;dates;;year;2010;/year;;/dates;;publisher;Mekelle University;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;Amare Ashenafi (2010) defined market as a specific geographical area where buyers and sellers meet for exchange of goods and services. In some cases, the market may mean the place where buying and selling takes place, an arena in which a good is sold, a group of people carrying on buying or selling, or the commodity traded, such as the corn market, or time market ADDIN EN.CITE ;EndNote;;Cite;;Author;Larson;/Author;;Year;1957 ;/Year;;RecNum;2;/RecNum;;DisplayText;(Larson, 1957 );/DisplayText;;record;;rec-number;2;/rec-number;;foreign-keys;;key app=”EN” db-id=”eaarzdwvlvf0vwew0f8p0xwtzxssw5ew9ved”;2;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Larson;/author;;/authors;;/contributors;;titles;;title;Agricultural marketing. Prentice- Hall. New York, USA.;/title;;/titles;;dates;;year;1957 ;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Larson, 1957 ). The authors argue further that market can be defined by location, product, time, and level. How we should define what market is depends largely on the problem to be analyzed ADDIN EN.CITE ;EndNote;;Cite;;Author;Charles;/Author;;Year;2013;/Year;;RecNum;13;/RecNum;;DisplayText;(Kerwin Kofi Charles;style face=”italic”; et al.;/style;, 2013);/DisplayText;;record;;rec-number;13;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;13;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Charles, Kerwin Kofi;/author;;author;Hurst, Erik;/author;;author;Notowidigdo, Matthew;/author;;/authors;;/contributors;;titles;;title;Manufacturing decline, housing booms, and non-employment;/title;;/titles;;dates;;year;2013;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Charles et al., 2013).

Although the different authors described market in different ways, they have used the common elements that can be adopted in this study such as a place where sellers and buyers meet, get information, and exchange commodities FAO (2008). In this paper, it is therefore described as a places where buyers and sellers come together to trade for exchange commodity in the study area.
Marketing: Similarly, the term marketing has a variety of meanings while used by various stakeholders. All the concepts reflect the different aspects of the marketing process. Many people consider marketing as selling and buying process. Today marketing is understood in the new sense of satisfying consumer needs. If the market does a good job of understanding consumer needs, develop products that provide superior value, price, distribute and promote them efficiently, the products will be sold easily. Marketing is the process of bringing sellers and buyers together for the purpose of exchanging title to goods and services ADDIN EN.CITE ;EndNote;;Cite;;Author;Kilungo;/Author;;Year;2001;/Year;;RecNum;12;/RecNum;;DisplayText;(Julius K Kilungo;style face=”italic”; et al.;/style;, 2001);/DisplayText;;record;;rec-number;12;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;12;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Kilungo, Julius K;/author;;author;Kavoi, Muendo M;/author;;author;Mairura, Zacharia;/author;;author;Kariuki, Joseph G;/author;;author;Muturi, Stachys N;/author;;/authors;;/contributors;;titles;;title;Marketing of smallholder produce: A synthesis of case studies in the highlands of central Kenya;/title;;/titles;;dates;;year;2001;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Kilungo et al., 2001) .

According to Kotler (2003) Marketing is defined as a social and a managerial process whereby individuals and groups obtain what they need and want through creating and exchanging products and value with others. Marketing has an essential productive value; it adds time utilities, form utilities, place utilities and possession utilities to products and commodities. Through the technical functions of storage, processing and transportation, marketing increases consumer satisfaction from any given quantity of output. ADDIN EN.CITE ;EndNote;;Cite;;Author;Mendoza;/Author;;Year;1995;/Year;;RecNum;10;/RecNum;;DisplayText;(Meyra Sebello Mendoza ;amp; Mark W Rosegrant, 1995);/DisplayText;;record;;rec-number;10;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;10;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Mendoza, Meyra Sebello;/author;;author;Rosegrant, Mark W;/author;;/authors;;/contributors;;titles;;title;Pricing conduct of spatially differentiated markets;/title;;secondary-title;PricesProducts and people: Analyzing agricultural markets in developing countries;/secondary-title;;/titles;;periodical;;full-title;PricesProducts and people: Analyzing agricultural markets in developing countries;/full-title;;/periodical;;pages;343-360;/pages;;dates;;year;1995;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Mendoza ; Rosegrant, 1995).

Marketing system: Marketing system is defined as the sequential set of kinds or types of business firms through which a product passes during the marketing process (Branson and Norvell, 1983). Also they define marketing system as the totality of product channels, market participants and business activities involved in the physical and economic transfer of goods and services from producers to consumers. It is usually seen as a “system” because it comprises several, usually stable, interrelated structures that, along with production, distribution, and consumption, underpin the economic process ADDIN EN.CITE ;EndNote;;Cite;;Author;Mendoza;/Author;;Year;1995;/Year;;RecNum;10;/RecNum;;DisplayText;(Meyra Sebello Mendoza ;amp; Mark W Rosegrant, 1995);/DisplayText;;record;;rec-number;10;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;10;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Mendoza, Meyra Sebello;/author;;author;Rosegrant, Mark W;/author;;/authors;;/contributors;;titles;;title;Pricing conduct of spatially differentiated markets;/title;;secondary-title;PricesProducts and people: Analyzing agricultural markets in developing countries;/secondary-title;;/titles;;periodical;;full-title;PricesProducts and people: Analyzing agricultural markets in developing countries;/full-title;;/periodical;;pages;343-360;/pages;;dates;;year;1995;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Mendoza ; Rosegrant, 1995).

Agricultural marketing: is nothing but it is agriculturally oriented marketing. It embraces all operations and institutions involved in moving farm products from farm to consumers ADDIN EN.CITE ;EndNote;;Cite;;Author;Pritchard;/Author;;Year;1969;/Year;;RecNum;16;/RecNum;;DisplayText;(Norris T Pritchard, 1969);/DisplayText;;record;;rec-number;16;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;16;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Pritchard, Norris T;/author;;/authors;;/contributors;;titles;;title;A framework for analysis of agricultural marketing systems in developing countries;/title;;/titles;;dates;;year;1969;/year;;/dates;;publisher;Foreign Development and Trade Division, Economic Research Service;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;(Pritchard, 1969). Agricultural marketing means that marketing of agricultural products to the first handler. It covers all the activities associated with the agricultural production and food, feed, and fiber assembly, input supply, collecting, processing and distribution to final consumers, including analysis of consumers’ needs, motivations, and purchasing and consumption behavior (Branson and Norvell, 1983). Agricultural marketing system is expected to play a great role in linking the rural and the urban population. Consumers spend a large amount of income on basic foods, hence with the growth of urbanization.
2.1.2 Marketing channels and market integrationMarketing channels: According to ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Gebremedhin</Author><Year>2012</Year><RecNum>17</RecNum><DisplayText>Berhanu Gebremedhin<style face=”italic”> et al.</style> (2012)</DisplayText><record><rec-number>17</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>17</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Gebremedhin, Berhanu</author><author>Jemaneh, Samson</author><author>Hoekstra, Dirk</author><author>Anandajayasekeram, P</author></authors></contributors><titles><title>A guide to market-oriented extension services with special reference to Ethiopia</title></titles><dates><year>2012</year></dates><urls></urls></record></Cite></EndNote>Berhanu Gebremedhin et al. (2012), market channel is a particular path through which the product passes from producers to consumers. The path of the product may vary from product to product, area to area, and hence there is no defined channel for product to arrive from producer to final consumers. But it differed due to the presence of other factors which affect the market channel such as market information and networking, infrastructure, distance of the two ends, skill and initiation of involver, linkage and linkage facilitation ADDIN EN.CITE <EndNote><Cite><Author>Gebremedhin</Author><Year>2012</Year><RecNum>17</RecNum><DisplayText>(Berhanu Gebremedhin<style face=”italic”> et al.</style>, 2012)</DisplayText><record><rec-number>17</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>17</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Gebremedhin, Berhanu</author><author>Jemaneh, Samson</author><author>Hoekstra, Dirk</author><author>Anandajayasekeram, P</author></authors></contributors><titles><title>A guide to market-oriented extension services with special reference to Ethiopia</title></titles><dates><year>2012</year></dates><urls></urls></record></Cite></EndNote>(Gebremedhin et al., 2012).

Formally, a marketing channel is a business structure of interdependent organizations that reach from the point of product to their final consumption destination with the purpose of moving products (Kotler and Armstrong, 2003). This channel may be short or long depending on quantity and quality of the product marketed, accessible marketing services, and current social and physical environment ADDIN EN.CITE <EndNote><Cite><Author>Islam</Author><Year>2000</Year><RecNum>18</RecNum><DisplayText>(M Serajul Islam<style face=”italic”> et al.</style>, 2000)</DisplayText><record><rec-number>18</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>18</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Islam, M Serajul</author><author>Miah, Tofazzal Hossain</author><author>Haque, Md Mojammel</author></authors></contributors><titles><title>Marketing system of marine fish in Bangladesh: an empirical study</title><secondary-title>Bangladesh Journal of Agricultural Economics</secondary-title></titles><periodical><full-title>Bangladesh Journal of Agricultural Economics</full-title></periodical><volume>24</volume><number>1-2</number><dates><year>2000</year></dates><urls></urls></record></Cite></EndNote>(Islam et al., 2000). Market integration: Many developing economies have been implementing Structural Adjustment and Market Reform Programs. It has also been argued that food market integration is a pre-condition for the success of such liberalization. Producer marketing decisions are based on market price information, and poorly integrated markets may convey inaccurate price information, leading to inefficient product movements ADDIN EN.CITE <EndNote><Cite><Author>Goodwin</Author><Year>1991</Year><RecNum>19</RecNum><DisplayText>(Barry K Goodwin &amp; Ted C Schroeder, 1991)</DisplayText><record><rec-number>19</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>19</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Goodwin, Barry K</author><author>Schroeder, Ted C</author></authors></contributors><titles><title>Cointegration tests and spatial price linkages in regional cattle markets</title><secondary-title>American Journal of Agricultural Economics</secondary-title></titles><periodical><full-title>American Journal of Agricultural Economics</full-title></periodical><pages>452-464</pages><volume>73</volume><number>2</number><dates><year>1991</year></dates><isbn>1467-8276</isbn><urls></urls></record></Cite></EndNote>(Goodwin & Schroeder, 1991). Market integration indicates the co-movement and the long run relationship between prices in different localities.
In our country to transport inputs and output from the point of production to the market, there are no roads beyond the Woreda level so that most farmers are forced to use pack animals. The communication network is limited in urban areas and it is traditional to communicate with the change in the market situation, especially to the side of producers that is why price decreases are easily transmitted but the increase in price are not fast to be disseminated. In addition to this storage facilities and processing industries are not well developed to preserve and add value to perishable raw materials and supply to the market consistently in spatially separated markets.

2.1.3 Market supply and marketable surplusMarketable surplus is the quantity of the produce left out after meeting farmer’s consumption and utilization requirements for kind payments and other obligations such as gifts, donation, charity, etc. ADDIN EN.CITE ;EndNote;;Cite;;Author;Takele;/Author;;Year;2010;/Year;;RecNum;2;/RecNum;;DisplayText;(Astewel Takele, 2010);/DisplayText;;record;;rec-number;2;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;2;/key;;/foreign-keys;;ref-type name=”Thesis”;32;/ref-type;;contributors;;authors;;author;Takele, Astewel;/author;;/authors;;/contributors;;titles;;title;Analysis of rice profitability and marketing chain: The case of Fogera Woreda, South Gondar Zone, Amhara national regional state, Ethiopia;/title;;/titles;;dates;;year;2010;/year;;/dates;;publisher;Haramaya University;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;(Astewel Takele, 2010). So, while marketable surplus shows the quantity left out for sale in the market, marketed surplus shows the quantity actually sold after accounting for losses and retention by farmers, if any and adding the previous stock left out for sale. Thus, the marketed surplus may be equal to marketable surplus, it may be less if the entire marketable surplus is not sold out and the farmers retain some stock and if losses occur at the farm or during transit ADDIN EN.CITE ;EndNote;;Cite;;Author;Thakur;/Author;;Year;1997;/Year;;RecNum;21;/RecNum;;DisplayText;(DS Thakur;style face=”italic”; et al.;/style;, 1997);/DisplayText;;record;;rec-number;21;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;21;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Thakur, DS;/author;;author;Lal, Harbans;/author;;author;Thakur, DR;/author;;author;Sharma, KD;/author;;author;Saini, AS;/author;;/authors;;/contributors;;titles;;title;Market supply response and marketing problems of farmers in the Hills;/title;;secondary-title;Indian Journal of Agricultural Economics;/secondary-title;;/titles;;periodical;;full-title;Indian Journal of Agricultural Economics;/full-title;;/periodical;;pages;139;/pages;;volume;52;/volume;;number;1;/number;;dates;;year;1997;/year;;/dates;;isbn;0019-5014;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Thakur et al., 1997). On the other hand, Market supply refers to the amount actually taken to the markets irrespective of the need for home consumption and other requirements, whereas the market surplus is the residual with the producer after meeting the requirement of seed, payment in kind and consumption by peasant at source ADDIN EN.CITE ;EndNote;;Cite;;Author;Amha;/Author;;Year;1994;/Year;;RecNum;22;/RecNum;;DisplayText;(Wolday Amha, 1994);/DisplayText;;record;;rec-number;22;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;22;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Amha, Wolday;/author;;/authors;;/contributors;;titles;;title;Food grain marketing development in Ethiopia after the market reform 1990: a case study of Alaba Siraro District;/title;;/titles;;dates;;year;1994;/year;;/dates;;publisher;Berlin (Germany), Verlag Koster, 1994;/publisher;;isbn;3895740063;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Amha, 1994),. Agricultural products differ from manufacturing goods in terms of supply and demand. Supply is peculiar because of the seasonal and biological nature while their demand is relatively stable throughout the year.

Empirical studies of supply relationships for farm products indicate that changes in product prices typically (but not always) explain a relatively small proportion of the total variation in output that has occurred over a period of years ADDIN EN.CITE ;EndNote;;Cite;;Author;Tomek;/Author;;Year;2014;/Year;;RecNum;9;/RecNum;;DisplayText;(William G Tomek ;amp; Harry M Kaiser, 2014);/DisplayText;;record;;rec-number;9;/rec-number;;foreign-keys;;key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″;9;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Tomek, William G;/author;;author;Kaiser, Harry M;/author;;/authors;;/contributors;;titles;;title;Agricultural product prices;/title;;/titles;;dates;;year;2014;/year;;/dates;;publisher;Cornell University Press;/publisher;;isbn;0801471109;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Tomek ; Kaiser, 2014). The weather and pest influence short run changes in output, while the long run changes in supply are attributable to factors like improvement in technology, which results in higher yields ADDIN EN.CITE ;EndNote;;Cite;;Author;Chavas;/Author;;Year;2001;/Year;;RecNum;8;/RecNum;;DisplayText;(Jean-Paul Chavas, 2001);/DisplayText;;record;;rec-number;8;/rec-number;;foreign-keys;;key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″;8;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Chavas, Jean-Paul;/author;;/authors;;/contributors;;titles;;title;Structural change in agricultural production: economics, technology and policy;/title;;secondary-title;Handbook of agricultural economics;/secondary-title;;/titles;;periodical;;full-title;Handbook of agricultural economics;/full-title;;/periodical;;pages;263-285;/pages;;volume;1;/volume;;dates;;year;2001;/year;;/dates;;isbn;1574-0072;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Chavas, 2001).

2.2 Market Chain, Supply Chain and Value Chain AnalysisAgricultural commodities are produced by large numbers of smallholder farmers in most developing countries, especially in our country and consumed by a large number of households. With the exception of food stuffs consumed on-farm or sold locally, they are bought and sold a number of times between the farm gate and the final consumer. While moving between these two points, the commodity is transported, stored, cleaned, graded and processed. It is the path one good flows from their source of original production to the ultimate destination for final use. According to Kotler (2003) supply chain is a long channel stretching from raw materials to final products that are carried to final buyers. He shortly put a value-delivery network. Under a free market, supply chains for a commodity develop to reflect its production, marketing and processing characteristics. It is the overall group of economic agents (producer, trader, consumer, institutions, or development organizations) that contribute directly to the determination of the final product ADDIN EN.CITE ;EndNote;;Cite;;Author;Westlake;/Author;;Year;2005;/Year;;RecNum;23;/RecNum;;DisplayText;(Michael John Westlake, 2005);/DisplayText;;record;;rec-number;23;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;23;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Westlake, Michael John;/author;;/authors;;/contributors;;titles;;title;Addressing marketing and processing constraints that inhibit agrifood exports: A guide for policy analysts and planners;/title;;/titles;;number;160;/number;;dates;;year;2005;/year;;/dates;;publisher;Food ;amp; Agriculture Org.;/publisher;;isbn;9251054150;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Westlake, 2005). Value chain describes the full range of activities required to bring a product or service through the different phases of production, including physical transformation, the input of various producer services, and response to consumer demand ADDIN EN.CITE ;EndNote;;Cite;;Author;Usman;/Author;;Year;2016;/Year;;RecNum;10;/RecNum;;DisplayText;(Sultan Usman, 2016);/DisplayText;;record;;rec-number;10;/rec-number;;foreign-keys;;key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″;10;/key;;/foreign-keys;;ref-type name=”Thesis”;32;/ref-type;;contributors;;authors;;author;Usman, Sultan;/author;;/authors;;/contributors;;titles;;title;Analysis of wheat value chain: The case of Sinana District, Bale Zone, Oromia Region, Ethiopia;/title;;/titles;;dates;;year;2016;/year;;/dates;;publisher;Haramaya University;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;(Sultan Usman, 2016). As such, value chains include the vertically linked interdependent processes that generate value for the consumer. Value chains focus more on value creation, innovation, product development, and marketing.

2.3 Methods of Evaluating Efficiency of Agricultural Marketing SystemEvaluation of the efficiency with which the agricultural marketing system operates forms the crux of analysis of marketing problem ADDIN EN.CITE ;EndNote;;Cite;;Author;Tesfaw;/Author;;Year;2013;/Year;;RecNum;24;/RecNum;;DisplayText;(Amare Tesfaw ;amp; Dawit Alemu, 2013);/DisplayText;;record;;rec-number;24;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;24;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Tesfaw, Amare;/author;;author;Alemu, Dawit;/author;;/authors;;/contributors;;titles;;title;Marketing channel and margin analysis: A case study of red pepper marketing at Jabitehinan District in Northwestern Ethiopia;/title;;/titles;;dates;;year;2013;/year;;/dates;;publisher;LAP LAMBERT Academic Publishing;/publisher;;isbn;3659392200;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Amare Tesfaw ; Dawit Alemu, 2013).At the same time, the analysts of the market structure, behavior and quantitative evaluation of the efficiency of the marketing system requires concept, theories, methods, data and workable frameworks and extremely difficult tasks (Branson and Norvell, 1983). ADDIN EN.CITE ;EndNote;;Cite;;Author;Abbott;/Author;;Year;1979;/Year;;RecNum;25;/RecNum;;DisplayText;(John Cave Abbott ;amp; John Patrick Makeham, 1979);/DisplayText;;record;;rec-number;25;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;25;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Abbott, John Cave;/author;;author;Makeham, John Patrick;/author;;/authors;;/contributors;;titles;;title;Agricultural economics and marketing in the tropics;/title;;/titles;;dates;;year;1979;/year;;/dates;;publisher;Longman;/publisher;;isbn;0582603048;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Abbott ; Makeham, 1979) indicated that factors accounting for efficiency can be evaluated by examining the characteristics of markets such as structure, conduct and performance. These elements measure the extent of deviation from the perfectly competitive norm. The larger the deviation, the more imperfectly competitive is the market, that is on extreme case would be a monopoly.2.3.1 Market structureMarket structure is defined as, those characteristics of the organization of the market that seem to exercise strategic influence on the nature of competition and pricing within the market ADDIN EN.CITE ;EndNote;;Cite;;Author;Bain;/Author;;Year;1956;/Year;;RecNum;13;/RecNum;;DisplayText;(Joe S Bain, 1956);/DisplayText;;record;;rec-number;13;/rec-number;;foreign-keys;;key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″;13;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Bain, Joe S;/author;;/authors;;/contributors;;titles;;title;Barriers to new competition;/title;;/titles;;volume;3;/volume;;dates;;year;1956;/year;;/dates;;publisher;Harvard University Press Cambridge, MA;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;(Bain, 1956). The characteristics usually stressed are the number and size distribution of firms in relation to the size of the market, the presence or absence of barriers to entry facing new firms, physical or subjective and product differentiation. ADDIN EN.CITE ;EndNote;;Cite;;Author;Tesfaw;/Author;;Year;2013;/Year;;RecNum;24;/RecNum;;DisplayText;(Amare Tesfaw ;amp; Dawit Alemu, 2013);/DisplayText;;record;;rec-number;24;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;24;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Tesfaw, Amare;/author;;author;Alemu, Dawit;/author;;/authors;;/contributors;;titles;;title;Marketing channel and margin analysis: A case study of red pepper marketing at Jabitehinan District in Northwestern Ethiopia;/title;;/titles;;dates;;year;2013;/year;;/dates;;publisher;LAP LAMBERT Academic Publishing;/publisher;;isbn;3659392200;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Amare Tesfaw ; Dawit Alemu, 2013) bring into play as a rule of thumb, four largest enterprises’ concentration ratio of 50% or more (an indication of a strongly oligopolistic industry), 33-50 % (a weak oligopoly) and less than that (competitive industry). The problem associated with this index is the arbitrary selection of r (the number of firms that are taken to compare the ratio). Market structure includes – a) the degree of buyer and seller concentration, defined by the number of buyers and sellers in the market b) the degree of market transparency which refers to the availability of relevant market information, its distribution among buyers and sellers, and its adequacy in terms of price sharpening, quality comparisons and risk reduction or uncertainty about the future c) the condition of entry to the market referring to the relative ease or difficulty with which seller may enter the market. This is generally determined by the advantages that established sellers have over potential entrants (Clodius and Mueller, 1961).

2.3.2 Market conductThe structure and conduct of market participants have a direct implication for the nature of production price relationships between different marketing levels. Market conduct refers to the strategies of traders in maximizing their profits. Market conduct refers to the behavior of firms or the strategy them uses in adopting or adjusting to the markets, for example, pricing, buying, selling, etc (Cramers and Jensen, 1982).
Price searchers can determine their selling prices or quantity of output they sell. In addition, they could use their market power to weaken or eliminate competitors example reducing price. According to ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Abbott</Author><Year>1979</Year><RecNum>25</RecNum><DisplayText>John Cave Abbott and John Patrick Makeham (1979)</DisplayText><record><rec-number>25</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>25</key></foreign-keys><ref-type name=”Book”>6</ref-type><contributors><authors><author>Abbott, John Cave</author><author>Makeham, John Patrick</author></authors></contributors><titles><title>Agricultural economics and marketing in the tropics</title></titles><dates><year>1979</year></dates><publisher>Longman</publisher><isbn>0582603048</isbn><urls></urls></record></Cite></EndNote>Abbott and Makeham (1979), conduct refers to the market behavior of all firms. ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Meijer</Author><Year>1994</Year><RecNum>26</RecNum><DisplayText>PWM Meijer (1994)</DisplayText><record><rec-number>26</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>26</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Meijer, PWM</author></authors></contributors><titles><title>The function of maize market in Benin</title><secondary-title>Bert Broundjin, Benin</secondary-title></titles><periodical><full-title>Bert Broundjin, Benin</full-title></periodical><pages>11-32</pages><dates><year>1994</year></dates><urls></urls></record></Cite></EndNote>Meijer (1994) said that, “conduct is pattern of behavior which enterprises follow in adopting or adjusting to the market in which they sell or buy”, in other words the strategies of the actors operating in the market. Market conduct of wheat traders is analyzed in terms of the producer and trader’s price setting, purchasing and selling strategies.

2.3.3 Market performancePerformance of the market is reflection of the impact of structure and conduct on product price, costs and the volume and quality of output (Cramers and Jensen, 1982). If the market structure in an industry resembles monopoly rather than pure competition, then one expects poor market performance.
According to ADDIN EN.CITE ;EndNote;;Cite AuthorYear=”1″;;Author;Abbott;/Author;;Year;1979;/Year;;RecNum;25;/RecNum;;DisplayText;John Cave Abbott and John Patrick Makeham (1979);/DisplayText;;record;;rec-number;25;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;25;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Abbott, John Cave;/author;;author;Makeham, John Patrick;/author;;/authors;;/contributors;;titles;;title;Agricultural economics and marketing in the tropics;/title;;/titles;;dates;;year;1979;/year;;/dates;;publisher;Longman;/publisher;;isbn;0582603048;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;Abbott and Makeham (1979), Market performance consists of the achievements, outcomes, and answers provided by the market. Is the consumption of the products increasing and sales in competitive market expanding? There are such practical indicators of how well a certain marketing system is operating. As a method for analysis, the SCP paradigm postulates that the relationship exists between the three levels distinguished. One can imagine a causal relation starting from the structure, which determine the conduct, which together determine the performance of agricultural marketing system in developing countries ADDIN EN.CITE ;EndNote;;Cite;;Author;Meijer;/Author;;Year;1994;/Year;;RecNum;27;/RecNum;;DisplayText;(PWM Meijer, 1994);/DisplayText;;record;;rec-number;27;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;27;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Meijer, PWM;/author;;/authors;;/contributors;;titles;;title;The function of maize market in Benin;/title;;secondary-title;Bert Broundjin, Benin;/secondary-title;;/titles;;periodical;;full-title;Bert Broundjin, Benin;/full-title;;/periodical;;pages;11-32;/pages;;dates;;year;1994;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Meijer, 1994).2.4 Methods of Evaluating Marketing PerformanceMarket performance can be evaluated by analysis of costs and margins of the marketing agent’s in different channels. A commonly used measure of system performance is the marketing margin or price spread ADDIN EN.CITE <EndNote><Cite><Author>Beshargo</Author><Year>2002</Year><RecNum>28</RecNum><DisplayText>(Getachew Beshargo, 2002)</DisplayText><record><rec-number>28</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>28</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Beshargo, Getachew</author></authors></contributors><titles><title>Cattle marketing in western Shewa</title><secondary-title>An M. Sc Thesis Presented to the School of Graduate Studies of Alemaya University, Ethiopia. 118p</secondary-title></titles><periodical><full-title>An M. Sc Thesis Presented to the School of Graduate Studies of Alemaya University, Ethiopia. 118p</full-title></periodical><dates><year>2002</year></dates><urls></urls></record></Cite></EndNote>(Getachew Beshargo, 2002).2.4.1 Marketing costs
Marketing costs are the embodiment of barriers to access to market participation by resource poor smallholders. Marketing costs include handling cost (packing and unpacking, costs of searching for a partner with whom to exchange, screening potential trading partners to ascertain their trustworthiness, bargaining with potential trading partners (and officials) to reach an agreement, transferring the product, monitoring the agreement to see that its conditions are fulfilled, and enforcing the exchange agreement ADDIN EN.CITE <EndNote><Cite><Author>Holloway</Author><Year>2002</Year><RecNum>29</RecNum><DisplayText>(Garth John Holloway &amp; Simeon Ehui, 2002)</DisplayText><record><rec-number>29</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>29</key></foreign-keys><ref-type name=”Book”>6</ref-type><contributors><authors><author>Holloway, Garth John</author><author>Ehui, Simeon</author></authors></contributors><titles><title>Expanding market participation among smallholder livestock producers: A collection of studies employing Gibbs sampling and data from the Ethiopian highlands, 1998-2001</title></titles><volume>48</volume><dates><year>2002</year></dates><publisher>ILRI (aka ILCA and ILRAD)</publisher><isbn>9291461318</isbn><urls></urls></record></Cite></EndNote>(Holloway & Ehui, 2002).

2.4.2 Marketing marginsA marketing margin is the percentage of the final weighted average selling price taken by each stage of the marketing chain. Total marketing margin is the difference between consumer pays and producer/farmer receives for his product. In other words, it is the difference between retail price and farm price (Cramers and Jensen1982).
According to William and Robinson (1990), a marketing margin is defined alternatively as (1) the difference between the price paid by consumers and that obtained by producers, (2) the price of a collection of marketing services that is the outcome of the demand for and the supply of such services. Under some conditions the marketing margin can be expected to remain constant as the quantity of the commodity marketed is changing, while under other conditions margin will vary.

2.5 Fundamental Approaches to Study MarketingThe most important characteristics of a marketing function is that it is a physical process or facilitating service that need to be performed one or more times within the marketing system to make marketing of agricultural products efficient and effective. The main marketing physical functions are assembling, grading, storing, processing, packaging, storing processed products, distributing and transporting while market research, product research and development, demand development, exchange services, finance and risk bearing and market information are the facilitating functions.
Marketing studies adopt different viewpoints and approaches to study agricultural marketing problems. The functional, institutional (organizational) and commodity approaches are a systems of understanding or analyzing marketing ADDIN EN.CITE <EndNote><Cite><Author>Mendoza</Author><Year>1995</Year><RecNum>30</RecNum><DisplayText>(Gilberto Mendoza, 1995)</DisplayText><record><rec-number>30</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>30</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Mendoza, Gilberto</author></authors></contributors><titles><title>A primer on marketing channels and margins</title><secondary-title>In: Scott GJ (ed), Prices, products and people: Analyzing agricultural markets in developing countries. Lynne Reinner Publishers, Boulder, London, UK</secondary-title></titles><periodical><full-title>In: Scott GJ (ed), Prices, products and people: Analyzing agricultural markets in developing countries. Lynne Reinner Publishers, Boulder, London, UK</full-title></periodical><pages>257-276</pages><dates><year>1995</year></dates><urls></urls></record></Cite></EndNote>(Mendoza, 1995). Some of the main approaches are discussed as follows:
2.5.1 Functional approachIn functional approach we look for the basic activities (functions) that have to be performed in marketing of agricultural commodities and the marketing of inputs into agricultural production. The functional approach is used to study marketing in terms of the various activities that are performed in getting farm products from the producer to the consumer. This approach helps compare costs and benefits of different functions. These activities are called functions ADDIN EN.CITE <EndNote><Cite><Author>Cramer</Author><Year>2001</Year><RecNum>12</RecNum><DisplayText>(Gail L Cramer<style face=”italic”> et al.</style>, 2001)</DisplayText><record><rec-number>12</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>12</key></foreign-keys><ref-type name=”Book”>6</ref-type><contributors><authors><author>Cramer, Gail L</author><author>Jensen, Clarence W</author><author>Southgate Jr, Douglas D</author></authors></contributors><titles><title>Agricultural economics and agribusiness</title></titles><number>Ed. 8</number><dates><year>2001</year></dates><publisher>John Wiley and Sons</publisher><isbn>0471388475</isbn><urls></urls></record></Cite></EndNote>(Cramer et al., 2001). The widely accepted functions are: a) exchange (buying and selling), b) physical (processing, storage, and transportation), and c) facilitating (standardization, financing, risk bearing, and market information).2.5.2 Institutional /System approachThe other approach for studying marketing is the institutional approach, which is concerned with the number and kinds of business firms and various institutions that perform the marketing activities. These organizations or people are middlemen who perform the operations necessary to transfer goods from the producer to consumer and inputs to the producer, because of the benefit of specialization and scale that exist in marketing as well as production. It covers all market participants (producer, assembler, transporter, wholesaler, retailer and consumer). The involvement of the relevant people and organizations determine the effectiveness of the system to increase market efficiency (Cramer and Jensen, 1982).

2.5.3 Commodity approachThis entails an analysis of marketing functions, system and structure, from the viewpoint of an individual product. The approach follows the commodity along the path between producer and consumer and is concerned with describing what is done and how the commodity could be handled more efficiently. In a commodity approach, a specific commodity or groups of commodities are taken and the functions and institutions involved in the marketing process are analyzed (Kohls and Uhl, 1985).
2.6 Empirical Evidences on Determinants of Agricultural Market SupplyAs discussed above market supply refers to the amount actually taken to the markets irrespective of the needs for home consumption and other requirements and the marketable surplus is the residual with the producer after meeting the requirement of seed, payment in kind, and consumption by farmer. Several studies have attempted to analyze the relationship between marketable surplus and determinants of market supply with a special emphasis of various specific commodities at different geographical locations. ADDIN EN.CITE <EndNote><Cite><Author>Wolelaw</Author><Year>2005</Year><RecNum>16</RecNum><DisplayText>(S Wolelaw, 2005)</DisplayText><record><rec-number>16</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>16</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Wolelaw, S</author></authors></contributors><titles><title>Factors determining supply of rice: A Study in Fogera District of Ethiopia. An MSc</title></titles><dates><year>2005</year></dates><publisher>Thesis presented to the School of Graduate Studies of Alemaya University. 90p</publisher><urls></urls></record></Cite></EndNote>(Wolelaw, 2005) identified lagged price, current price, amount of rice production at farm level and consumption at household level are the major factors that affect marketable supply of rice in the case of Fogera district using multiple linear regression analysis. Kinde (2007) also indicated productivity, number of language spoken by the household head, use of modern inputs, number of oxen owned, area and time of selling the product are the determinate factors that affect positively marketable supply of sesame in the case of Metema district by using cross-sectional data and multiple linear regression analysis. Another study by Astewel Takele, (2010); find out the major factors that affect the marketable supply of rice at Fogera district using multiple linear regression models. He investigated the relationship between the determinant factors of supply and the marketable supply of rice and his study revealed that the current price, lagged price, amount of rice production at farm level and consumption at household level had influenced marketable supply of rice at the district.

Others identified the following are the determinants of marketable surplus in the case of fruits (Ayelech, 2011) such as fruit production experience, education level of household head, quantity of fruit produced, extension contact, lagged price, and distance to market, and in the case of teff (Mohammed, 2011) identified quantity of teff produced, access to market information, access to extension and sex of the household head are the major factors that significantly affected positively the marketable supply of teff. Likewise, the results of econometric analysis of durum wheat value chain by ADDIN EN.CITE <EndNote><Cite><Author>Ketema</Author><Year>2014</Year><RecNum>4</RecNum><DisplayText>(Mengistu Ketema &amp; Haymanot Asfaw, 2014)</DisplayText><record><rec-number>4</rec-number><foreign-keys><key app=”EN” db-id=”v9epwpa0i9stt3ed09qvtfey9z99xxsdzv0x”>4</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Ketema, Mengistu</author><author>Asfaw, Haymanot</author></authors></contributors><titles><title>Durum Wheat Value Chain Analysis: The Case of Gololcha District of Bale Zone, Ethiopia</title></titles><dates><year>2014</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>(Mengistu Ketema & Haymanot Asfaw, 2014) indicated that sex of household head, lagged durum wheat price, access to credit, quantity of seed used, land size allocated for durum wheat and size of livestock holding had positive relationship while family size had negative relationship with the volume of durum wheat marketed. Abraham (2013), by using multiple regression analysis, marketable supply is significantly affected by access to market information and quantity of tomato produced in the case of tomato; access to extension service, access to market information, vegetable farming experience and quantity of potato produced in the case of potato. Similarly, Nega Mateows (2015) conducted market chain analysis of agro-forestry products in the case of fruit at Tembaro District, South Ethiopia particularly on mango, banana and avocado. The result of multiple linear regression analysis for each commodity indicated that quantity produce of each commodity, market information; extension service, market distance, active family member and price of the commodities were major predictor variables that affect the market supply of the stated commodities.

3. RESEARCH METHODOLOGY
3.1 Description of the Study AreasDebre Elias woreda is one of the eighteen woreda which found in East Gojjam Zone, Amhara Regional state of Ethiopia, which is located around 340 km Northwest of Addis Ababa and about 41 km Northwest of Debre Markose town. It is bounded by the Abay River at the south and west, Mirab Gojjam Zone at the northwest, Machakele woreda at the north, and Guzamen woreda at the east. In the study woreda there are fifteen Kebele administrations (KAs) with one urban kebele and fourteen rural kebeles. From the total fifteen KAs in the study woreda, four rural kebeles namely Guayi, Gofichema, Gennet and Dejiba were the study sites.

Figure SEQ Figure * ARABIC 1 map of the study area
The altitude of the woreda ranges from 800-2200 meter above sea level (m.a.s.l.) and receives mean annual rainfall of 1150 mm which occurs mainly in the June, July, August and September. Other months of the year are almost dry with erratic rainfall. The average daily temperature ranges from 18- 27OC ADDIN EN.CITE <EndNote><Cite><Author>Melaku</Author><Year>2012</Year><RecNum>36</RecNum><DisplayText>(Achenef Melaku &amp; Admas Abebe, 2012)</DisplayText><record><rec-number>36</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>36</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Melaku, Achenef</author><author>Abebe, Admas</author></authors></contributors><titles><title>Bovine Trypanosomosis and Its Vector Type and Density at Debre Elias District, North-western, Ethiopia</title><secondary-title>Journal of Advanced Veterinary Research</secondary-title></titles><periodical><full-title>Journal of Advanced Veterinary Research</full-title></periodical><pages>247-251</pages><volume>2</volume><number>4</number><dates><year>2012</year></dates><isbn>2090-6277</isbn><urls></urls></record></Cite></EndNote>(Achenef Melaku & Admas Abebe, 2012) . Moreover, the red soils are the dominant soil type and it is moderately fertile. The woyinadega (mid highlands) agro ecological condition of the study area accounts for 98 %and the rest 2% accounts kolla. In general, the weather condition is a hospitable environment for the moderately dense population that ranges from 100-120 people per km2 (DEWOA, 2012).
Based on the 2007 national census conducted by the CSA of Ethiopia, Debre Elias woreda had a total population of 82,150, of whom 41,109 were men and 41,041 women; and 7,928 or 9.65% were urban inhabitants. The majority of the inhabitants practiced Ethiopian Orthodox Tewahido Christianity, with 98.94% reported that as their religion, while 1.01% of the populations were Muslim.
In the study area the farming system is a mixed farming system mainly based on crop production and livestock rearing activities. Agriculture is dependent on the Kiremt rains with minimum irrigation practices. According to DEWOA (2016), report in 2015/16 production year only a total of 2,696 ha of land were cultivated through irrigated agriculture; a total of 39,100 ha of lands were cultivated through rain-fed agriculture. This indicates that the small scale irrigation activities are not expanded in the study area. Wheat, Teff and Maize are the dominant and most important crops, serving as both the main food and cash crops. Other crops grown in the study area includes Barley, Nouge and Beans. Crop sales make the largest contribution to the household income together with sheep and goat for their cash earnings.
Cattle, sheep, goats, donkeys, horses, honey bee production and chickens are the most reared livestock. Cattle and sheep are free-grazers at the grazing land and are given complementary crop residues at the dry season whilst chicken are scavengers and partly feed grain. Livestock are a significant source of income, mostly obtained from the sale of sheep and goats. Oxen are used to provide traction power for land preparation activities. Wheat is more is a growing herd provides an asset base that would support the household to withstand the impact of a shock on food and income sources.
3.2 Methods of Data CollectionThe study used both primary and secondary data collected from main actors of wheat market chain in Debre Elias woreda and from various research and office reports and documents. Formal and informal sample survey methods were used to collect primary and secondary data. The Primary data were collected at all levels of the marketing chain that includes producers, middlemen, traders, wholesalers, processors and supporting institutions (such as agriculture and rural development office, trade and industry office and SMEs) through structured and semi-structured interviews individually and through key informant interviews (KIIs) and focus group discussions (FGDs), checklist to guide the discussion.
Secondary data were collected from published and unpublished documents mainly on the following variables such as number of wholesalers and retailers which are licensed and unlicensed, monthly lagged retail price of wheat, total inputs used for wheat production, credit, and number of investors involved, annual volumes of sales, purchases and storage time. The secondary data sources were regional DEA, (East Gojjam Zone Agricultural Development Department and Debre Elias Woreda office of agriculture), research centers and other related offices.

3.3 Sample Size and Sampling MethodA two-stage sampling technique was used to select rural households from a population of wheat producing farmers in Debre Elias woreda. In doing so, at the first stage, in consultation with agriculture and rural development office of the Woreda, four kebeles were selected randomly among the total sixteen wheat producing kebeles. These are Guayi, Gofichema, Genet, and Dejiba. In the second stage, a sample of 154 wheat producers were selected among a total of 9814 rural households from the selected four kebeles by using simple random sampling technique taking into account probability proportional to size of each sample kebele (see Table 1 below). The sample size of rural households was determined by using the following formula developed by ADDIN EN.CITE <EndNote><Cite><Author>Yamane</Author><Year>1973</Year><RecNum>37</RecNum><DisplayText>(Taro Yamane, 1973)</DisplayText><record><rec-number>37</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>37</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Yamane, Taro</author></authors></contributors><titles><title>Statistics: An introductory analysis</title></titles><dates><year>1973</year></dates><urls></urls></record></Cite></EndNote>(Yamane, 1973) sampling formula at 8% precision level to determine the required sample size for this study.
Where:
n= the sample size
N= the population size (9814)
e= the level of precision (0.08)
Table SEQ Table * ARABIC 1: Total population and sample size of wheat producerskebele name Total number of population Percent Sample size
Guayi1359 28.23 43
Gofichema 1636 33.98 52
Genet 917 19.05 30
Dejiba 902 18.74 29
Total 4814 100 154
Source: Own survey data (2017)Traders sampling
The numbers of sample trader were determined in collaboration with the Woreda trade and industry and SMEs. A significant amount of sample was selected randomly from each marketing agents involved in the overall marketing of this particular crop.

Table SEQ Table * ARABIC 2: Sample size of traders in their respective towns’gebeyaVariable Debre Elias special woreda markets Other Market Total
GuayGofechemaGenet Debre Elias Debre 
Markos Bahir Dar Wholesalers 1 – – 5 2 1 9
collector or FT 2 2 2 – – – 6
urban assemble 2 1 – 4 – – 7
Urban retailers – – – – 2 1 3
Rural retailers – – – 5 – – 5
Processors – – – 1 – – 1
Total 5 3 2 15 4 2 31
Source: Own survey data (2017)
Data were also collected from input supplier cooperatives and unions using independent semi structured questionnaire designed for this purpose.

3.4 Methods of Data Analysis
This study was used both descriptive and econometric analytical techniques. The descriptive statistics include percentages, ratios, means, variances and standard deviations in the process of examining and describing marketing functions, farm household characteristics, resource ownership, role of intermediaries, market and traders characteristics and profitability of wheat production. Multiple linear regression models were employed to analyze factors affecting market supply of wheat.

3.4.1 Rapid market appraisalIn addition to the questionnaire survey, an informal survey in the form of Rapid Market Appraisal (RMA) technique was employed using checklists for both farmers and traders to obtain additional supporting information for the study. The discussions were made with key informant farmers, traders, and agricultural and relevant experts from both government and non-government organizations.
3.4.2 Analysis of Production and Marketing SupportsThe supports provided by different stakeholders in the production and marketing of wheat were assessed based on the key informant interview and focus group discussion with community representative farmers. Information on extension service provided, input supply (fertilizer, improved seed, farm implements and chemicals), credit (amount, interest, repayment period), market information on input and output prices was collected. In addition to this the incentives provided to promote producers and traders were discussed with administrative and other concerned sectors such as financial institutions, Woreda council and others. The information derived from KIIs and FGDs was analyzed qualitatively with a narrative summary and descriptive statistics.

3.4.3 Analysis of structure, conduct and performance (S-C-P) of wheat market
The (S-C-P) model is an analytical approach that was used to study how the structure of the market and the behavior of sellers of different commodities and services affect the performance of market, and consequently the welfare of the country as a whole (Kizito, 2008). The model examines the causal relationships between market structure, conduct, and performance, and is usually referred to as the structure, conduct, performance (S-C-P) model. Analysis of market Structure
Concentration ratio, barrier to entry and the Hirschman Herfindahl Index (HHI) are the most widely used methods in the empirical literature of market structure; however due to its wide applicability in many researches concentration ratio and barrier to entry was used in this study. The wheat market structure was evaluated by the nature of markets degree of integration in an industry (perfectly competitive, monopolistic or oligopolistic), the degree of buyers’ concentration, the degree of product differentiation and by the conditions of entry and exit.

Market concentration
Market concentration is defined as the number and size distribution of sellers and buyers in the market. The greater degree of concentration is the greater the possibility of non-competitive behavior existing in the market. For an efficient market, there should be sufficient number of firms (buyers and sellers).
This method is used to analyze the structure of the wheat market based on the results of concentration ratio that Kohls and Uhl (1985) suggest that, as a rule of thumb, a four enterprise concentration ratios of 50% or more is indicative of strongly oligopolistic industry, of 33-50 % a weak oligopoly, and less than 33% an un-concentrated industry. In general, the larger is the concentration ratio for the largest four market participants the less competitive the market becomes. The following is the formula to calculate concentration ratio that used to measure the structure of wheat market in the study areas.
(1)
Where Si = Market share of buyer i Vi = Amount of product handled by buyer i ?Vi= Total amount of product handled
i =1, 2…… m (2)
Where C = Concentration ratio
Si = Percentage share of the ith firm
m = Number of largest firms for which the ratio is going to be calculated
HHI as discussed above is the other method commonly used to measure the market power, which can be calculated by the formula as follows.
HHI=
Where:
HHI = Hirschman Herfindahl Index,
Si = the percentage market share of ith firm, and
n = the total number of firms.

A very small index indicates the presence of many firms of comparable size, whilst either 1 or near 1, suggests that the number of firms is small and/or that they have unequal shares in the market ADDIN EN.CITE <EndNote><Cite><Author>Scarborough</Author><Year>1992</Year><RecNum>9</RecNum><DisplayText>(Vanessa Scarborough &amp; Jonathan Kydd, 1992)</DisplayText><record><rec-number>9</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>9</key></foreign-keys><ref-type name=”Book”>6</ref-type><contributors><authors><author>Scarborough, Vanessa</author><author>Kydd, Jonathan</author></authors></contributors><titles><title>Economic analysis of agricultural markets: A manual</title></titles><volume>5</volume><dates><year>1992</year></dates><publisher>Natural Resources Institute</publisher><isbn>085954317X</isbn><urls></urls></record></Cite></EndNote>(Scarborough & Kydd, 1992).

Barriers to entry:
ADDIN EN.CITE <EndNote><Cite><Author>Fee</Author><Year>2004</Year><RecNum>14</RecNum><DisplayText>(Preston R Fee<style face=”italic”> et al.</style>, 2004)</DisplayText><record><rec-number>14</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>14</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Fee, Preston R</author><author>Mialon, Hugo M</author><author>Williams, Michael A</author></authors></contributors><titles><title>What is a Barrier to Entry?</title><secondary-title>American Economic Review</secondary-title></titles><periodical><full-title>American Economic Review</full-title></periodical><pages>461-465</pages><volume>94</volume><number>2</number><dates><year>2004</year></dates><isbn>0002-8282</isbn><urls></urls></record></Cite></EndNote>(Fee et al., 2004) reviewed the ease with which potential participants can enter various functions is commonly used as a means of assessing the degree of competition in an industry. He also suggests about four points that can create barriers to entry: legal barriers (franchise and patents), economies of scale, superior resources, and pace of entry. The modes of entry into trade, means of building capital, means of acquiring marketing skills and contacts, periods of apprenticeship, trader’s perceptions of barriers, the origins and levels of initial capital required for traders of different sizes (functions, or commodities), and the degree of mobility between functions and commodities can be used as center of data to see the barriers to entry ADDIN EN.CITE ;EndNote;;Cite;;Author;Timmer;/Author;;Year;2009;/Year;;RecNum;8;/RecNum;;DisplayText;(C Peter Timmer, 2009);/DisplayText;;record;;rec-number;8;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;8;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Timmer, C Peter;/author;;/authors;;/contributors;;titles;;title;Rice price formation in the short run and the long run: The role of market structure in explaining volatility;/title;;/titles;;dates;;year;2009;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Timmer, 2009).

Interviewing traders about barriers to entry might be difficult since all have entered the market. Rather, observation of the age, gender, and ethnic distributions of owners, an employee of different sizes of enterprises and the extent to which fluctuations in the number of active traders follow wheat and falls in profitability can be considered. Market structure is most commonly evaluated by examining trends in the numbers and sizes of firms relative to each other, and to number of consumers and producer, in particular times and places ADDIN EN.CITE ;EndNote;;Cite;;Author;Scarborough;/Author;;Year;1992;/Year;;RecNum;9;/RecNum;;DisplayText;(Vanessa Scarborough ;amp; Jonathan Kydd, 1992);/DisplayText;;record;;rec-number;9;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;9;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Scarborough, Vanessa;/author;;author;Kydd, Jonathan;/author;;/authors;;/contributors;;titles;;title;Economic analysis of agricultural markets: A manual;/title;;/titles;;volume;5;/volume;;dates;;year;1992;/year;;/dates;;publisher;Natural Resources Institute;/publisher;;isbn;085954317X;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Scarborough ; Kydd, 1992).
Analysis of market conduct
To study market conduct there are no agreed upon procedures for analyzing the elements. For this particular crop the existence of formal and informal producing and marketing groups; the availability of price information and its impact on prevailing prices; and the feasibility of utilizing alternative market pricing, buying and selling practices was assessed (Wolday, 1994). Market conduct is analyzed in terms of the producer and trader’s price setting, purchasing and selling strategies. The issues that were taken into consideration were the existence of formal and informal marketing groups that affect the bargaining power and the availability of price information as well as its impact on prevailing prices.

Analysis of market performance:
ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Scott</Author><Year>1995</Year><RecNum>41</RecNum><DisplayText>Gregory J Scott (1995)</DisplayText><record><rec-number>41</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>41</key></foreign-keys><ref-type name=”Book”>6</ref-type><contributors><authors><author>Scott, Gregory J</author></authors></contributors><titles><title>Prices, products, and people: analyzing agricultural markets in developing countries</title></titles><dates><year>1995</year></dates><publisher>Lynne Rienner Publishers</publisher><isbn>1555876099</isbn><urls></urls></record></Cite></EndNote>Scott (1995) that performance as well as the integration of markets is the result of the actions of traders and of the operating environment determined by the infrastructure available for trading and policies affecting the price transmission from one market to another. To analyze the performance of the market in this study, marketing margin was used.
Marketing margin
A marketing margin is defined alternatively as (1) the difference between the price paid by consumers and that obtained by producers (2) the price of a collection of marketing services that is the outcome of the demand for and the supply of such services.
The cost and price information obtained from the survey was used to evaluate the gross marketing margin. Total Gross Marketing Margin (TGMM) is always related to the final price paid by the end buyer and is expressed as percentage ADDIN EN.CITE <EndNote><Cite><Author>Mendoza</Author><Year>1995</Year><RecNum>42</RecNum><DisplayText>(Gilberto Mendoza, 1995)</DisplayText><record><rec-number>42</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>42</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Mendoza, Gilberto</author></authors></contributors><titles><title>A primer on marketing channels and margins</title><secondary-title>In: Scott GJ (ed), Prices, products and people: Analyzing agricultural markets in developing countries. Lynne Reinner Publishers, Boulder, London, UK</secondary-title></titles><periodical><full-title>In: Scott GJ (ed), Prices, products and people: Analyzing agricultural markets in developing countries. Lynne Reinner Publishers, Boulder, London, UK</full-title></periodical><pages>257-276</pages><dates><year>1995</year></dates><urls></urls></record></Cite></EndNote>(Mendoza, 1995). The method of analysis of marketing margin is as follows,
Where, TGMM = Total gross marketing margin
The TGMM is useful to calculate ‘producer’s gross margin’ (GMMp) which is the portion of the price paid by the consumer that goes to the producer.
The producer’s margin is calculated as:

Where, GMMp = the producer’s share in consumer price
Where, NMM = Net marketing margin3.4.4 Profitability analysisTo analyze the profitability of extension package inputs for wheat and barley in Ethiopia ADDIN EN.CITE ;EndNote;;Cite;;Author;Legese;/Author;;Year;2008;/Year;;RecNum;43;/RecNum;;DisplayText;(Dejene Legese, 2008);/DisplayText;;record;;rec-number;43;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;43;/key;;/foreign-keys;;ref-type name=”Conference Proceedings”;10;/ref-type;;contributors;;authors;;author;Legese, Dejene;/author;;/authors;;/contributors;;titles;;title;Profitability of extension package inputs for Wheat and Barley in Ethiopia. the case of Limuna Bilbilo Wereda (Arsi Zone). Rural Development and environment in Ethiopia; prospect and challenges;/title;;secondary-title;Proceeding of the 10th Annual Conference of Agricultural Economics Society of Ethiopia, Addis Abeba, Ethiopia;/secondary-title;;/titles;;dates;;year;2008;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Dejene Legese, 2008) used Value-Cost Ratio (VCR) for hectare of land. In this study the usual gross profit formula was used to analyze profitability based on the price and cost information.

Where p = price of produce
Q= Total production per hectare
Pi= price of input i qi= Quantity of input i used per hectare
3.6. Econometric Analysis3.6.1 Marketable supply analysisModeling of the data is one of the crucial purposes of data analysis. Different econometric models were used to do this. What matters is the nature of the dependent variable to determine the type of econometric model. Since the dependent variable in this case is the volume of wheat marketed in the study area which has a continuous numerical value and also all wheat producers participate in the market, this study used multiple linear regression models to analyze factors affecting volume of wheat marketed in the study area. This model is also selected for its simplicity and practical applicability ADDIN EN.CITE ;EndNote;;Cite;;Author;Becker;/Author;;Year;2001;/Year;;RecNum;47;/RecNum;;DisplayText;(William E Becker ;amp; William H Greene, 2001);/DisplayText;;record;;rec-number;47;/rec-number;;foreign-keys;;key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”;47;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Becker, William E;/author;;author;Greene, William H;/author;;/authors;;/contributors;;titles;;title;Teaching statistics and econometrics to undergraduates;/title;;secondary-title;Journal of Economic Perspectives;/secondary-title;;/titles;;periodical;;full-title;Journal of Economic Perspectives;/full-title;;/periodical;;pages;169-182;/pages;;volume;15;/volume;;number;4;/number;;dates;;year;2001;/year;;/dates;;isbn;0895-3309;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Becker ; Greene, 2001). The following is specification of econometric model of supply function in matrix notation.

Where:
= an intercept
Y = volume of wheat marketed supply (dependent variable)
X’i = independent variable, and i is 1, 2, 3… m
= coefficients of ith independent variable
U = Disturbance term/Error term/
To estimate the determinants of marketable supply of wheat production in Deber Elias Woreda the cross-sectional data was gathered on the hypothesized variables. Because of the difficulty to include an exhaustive set of variables that could affect the household level of marketable supply of the product, all the remaining/omitted variables are assumed to be included in the error term. The main hypothesized variables included in the model are described as follows;Dependent variableVolume of marketable supply of wheat (WHT_SALE): It is a continuous dependent variable measured in quintal (100kg). It represents the actual quantity of wheat marketed by farm households in the survey year.
Explanatory variables
Basing on economic theories and review of empirical literatures in marketing, the variables expected to affect the market supply of wheat are defined and hypothesized their relationship with the dependent variable as follows.

Land size of wheat (LND_WHT): It is a continuous variable representing the total land size (in hectare) allocated for wheat production. . Land is one of the major factors of production in agriculture and similarly in wheat production, which is expected to influence volume of wheat supply to the market positively. The more land allocated for wheat production by a farmer the more probability to participate in marketing of wheat ADDIN EN.CITE <EndNote><Cite><Author>Sefera</Author><Year>2004</Year><RecNum>44</RecNum><DisplayText>(Desta Beyera Sefera<style face=”italic”> et al.</style>, 2004)</DisplayText><record><rec-number>44</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>44</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Sefera, Desta Beyera</author><author>Dadi, Legesse</author><author>Srivastava, RSL</author></authors></contributors><titles><title>30. Impact of Community Managed Irrigation on Farm Production Efficiency and Household Income: The Cases of Woliso and Wonchi Districts of Oromiya Regional State</title></titles><dates><year>2004</year></dates><urls></urls></record></Cite></EndNote>(Desta Beyera Sefera et al., 2004). Therefore, farm size and marketable supply are expected to have direct relationship.

Age of household head (HH_AGE): It is a continuous variable measured in years. This variable is expected to influence positively participation of smallholder farmers in wheat marketing the fact that an individual stay long would have better knowledge accumulated for enhancing better production and participation in wheat marketing. ADDIN EN.CITE <EndNote><Cite><Author>Gessesse</Author><Year>2009</Year><RecNum>45</RecNum><DisplayText>(Adugna Gessesse, 2009)</DisplayText><record><rec-number>45</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>45</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Gessesse, Adugna</author></authors></contributors><titles><title>Analysis of fruit and vegetable market chains in Alamata, Southern Zone of Tigray: The case of onion, tomato and papaya</title></titles><dates><year>2009</year></dates><publisher>International Livestock Research Institute</publisher><urls></urls></record></Cite></EndNote>(Adugna Gessesse, 2009) who found that age of the household head has negative effect on the elasticity of onion supply to the market.Sex of household head (HH_SEX): a dummy variable taking a value of 1 if the household head is male and zero otherwise. No sign was attached with the variable. ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Tshiunza</Author><Year>2001</Year><RecNum>46</RecNum><DisplayText>M Tshiunza<style face=”italic”> et al.</style> (2001)</DisplayText><record><rec-number>46</rec-number><foreign-keys><key app=”EN” db-id=”p0f0p2fzoatt04ewd29v00a6sdxwpdaw0asp”>46</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Tshiunza, M</author><author>Lemchi, J</author><author>Tenkouano, A</author></authors></contributors><titles><title>Determinants of market production of cooking banana in Nigeria</title><secondary-title>African Crop Science Journal</secondary-title></titles><periodical><full-title>African Crop Science Journal</full-title></periodical><pages>537-547</pages><volume>9</volume><number>3</number><dates><year>2001</year></dates><isbn>1021-9730</isbn><urls></urls></record></Cite></EndNote>M Tshiunza et al. (2001) determined that male headed farmers tended to produce more for market than female headed farmers.
Lagged price of wheat (LG-PRICE): This variable is also a continuous variable measured in terms of ETB per quintal. It is hypothesized that this variable affects market supply of wheat positively assuming that earning a higher price in the previous year would serve as an incentive for farmers to participate more in the production and sale of wheat next year. Empirical evidences indicated that there is a direct relationship between previous year prices and next year market supplies of products. For instance, in case of avocado and mango ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Tadesse</Author><Year>2011</Year><RecNum>1</RecNum><DisplayText>Ayelech Tadesse (2011)</DisplayText><record><rec-number>1</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>1</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Tadesse, Ayelech</author></authors></contributors><titles><title>Market chain analysis of fruits for Gomma woreda, Jimma zone, Oromia National Regional State</title></titles><dates><year>2011</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Ayelech Tadesse (2011) argued that when avocado and mango price is high in the market in the previous year, farmers are motivated to take their produced to the market. And in teff and wheat ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Urgessa</Author><Year>2011</Year><RecNum>5</RecNum><DisplayText>Muhammed Urgessa (2011)</DisplayText><record><rec-number>5</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>5</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Urgessa, Muhammed</author></authors></contributors><titles><title>Market chain analysis of teff and wheat production in Halaba Special Woreda, southern Ethiopia</title></titles><dates><year>2011</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Muhammed Urgessa (2011) reported that the higher previous year prices in the market the more motivated the farmers to take their produced to the market. Hence, this variable is expected to affect both status and level of farmer’s participation in wheat market supply positively.

Extension contact (EXTCON): this variable is a continuous variable indicating extension service farmers are getting. This variable is expected to influence participation positively. Obviously, as farmers who have contact with extension workers are more likely to know the advantage of production like wheat and the availability, quality, and price of inputs. Therefore contact with extension agent is assumed to have positive relationship with market volume of marketable surplus.
Distance to the nearest market (MRK_DIST): It is the distance of the wheat producer households from the nearest market and it is measured in hours of walking time. The closer the market, the lesser would be the transportation charges, reduced walking time, and reduced other marketing costs, better access to market information and facilities. In this study distance to the nearest market is hypothesized to affect volume of wheat sales negatively. Similar issue was studied by ADDIN EN.CITE ;EndNote;;Cite AuthorYear=”1″;;Author;Tadesse;/Author;;Year;2011;/Year;;RecNum;1;/RecNum;;DisplayText;Ayelech Tadesse (2011);/DisplayText;;record;;rec-number;1;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;1;/key;;/foreign-keys;;ref-type name=”Thesis”;32;/ref-type;;contributors;;authors;;author;Tadesse, Ayelech;/author;;/authors;;/contributors;;titles;;title;Market chain analysis of fruits for Gomma woreda, Jimma zone, Oromia National Regional State;/title;;/titles;;dates;;year;2011;/year;;/dates;;publisher;Haramaya University;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;Ayelech Tadesse (2011) on fruit market in Goma woreda identified that poor market access has significant and negative effect on quantity of avocado and mango supplied.

Quantity of wheat produced (WHT_PROD): It is continuous variable measured in quintals. A marginal increase in wheat production has obvious and significant effect in motivating market supply. Therefore, this variable is hypothesized to have a positive effect on market supply. ADDIN EN.CITE ;EndNote;;Cite AuthorYear=”1″;;Author;Takele;/Author;;Year;2010;/Year;;RecNum;2;/RecNum;;DisplayText;Astewel Takele (2010);/DisplayText;;record;;rec-number;2;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;2;/key;;/foreign-keys;;ref-type name=”Thesis”;32;/ref-type;;contributors;;authors;;author;Takele, Astewel;/author;;/authors;;/contributors;;titles;;title;Analysis of rice profitability and marketing chain: The case of Fogera Woreda, South Gondar Zone, Amhara national regional state, Ethiopia;/title;;/titles;;dates;;year;2010;/year;;/dates;;publisher;Haramaya University;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;Astewel Takele (2010) analytical result showed that, the quantity of paddy produced jointly affected both the probability of market participation and volume of supply. Therefore, it is assumed to affect market supply positively.

Education of the household head (HH_EDU): It is a dummy variable with a value of 1 if literate and 0 otherwise. Education broadens farmers’ intelligence and enables them to perform the farming activities intelligently, accurately and efficiently. Moreover, literate farmers tend to be more innovative and are therefore more likely to adopt the marketing systems. Formal education enhances the information acquisition and adjustment abilities of the farmer, thereby improving the quality of decision making (Akoya` et al., 2007.). ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Takele</Author><Year>2010</Year><RecNum>2</RecNum><DisplayText>Astewel Takele (2010)</DisplayText><record><rec-number>2</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>2</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Takele, Astewel</author></authors></contributors><titles><title>Analysis of rice profitability and marketing chain: The case of Fogera Woreda, South Gondar Zone, Amhara national regional state, Ethiopia</title></titles><dates><year>2010</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Astewel Takele (2010) also indicated that the amount of paddy supplied to the market increases as paddy producer gets educated. Therefore, this variable is hypothesized to influence volume of wheat sales positively.

Access to market information (MRK_ INFO): This variable is measured as a dummy variable taking a value of 1 if the farmer had access to market information and 0 otherwise. It is hypothesized to affect positively farmer’s participation in wheat marketing. Farmers that have access to market information are likely to participate more than with low informed producers.
Family size (FAMSZ): This variable is a continuous variable and refers to the total number of family members expressed in the household. The size of economically active family members within a given farming household affects the crop production activities positively ADDIN EN.CITE ;EndNote;;Cite;;Author;Tadesse;/Author;;Year;2004;/Year;;RecNum;4;/RecNum;;DisplayText;(Million Tadesse ;amp; Belay Kassa, 2004);/DisplayText;;record;;rec-number;4;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;4;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Tadesse, Million;/author;;author;Kassa, Belay;/author;;/authors;;/contributors;;titles;;title;Determinants of fertilizer use in Gununo area, Ethiopia;/title;;/titles;;dates;;year;2004;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Million Tadesse ; Belay Kassa, 2004). Thus, in this respect family size is expected to have positive impact on sale volume. But larger family size requires larger amounts for consumption. Therefore, family size can affect sale volume of wheat marketed either positively or negatively.

Tropical livestock unit (TLU): A continuous variable which is expected to influence production participation and thereby supply positively. It is expected that participation probability of farmers to supply wheat would increase as livestock herd size (TLU) of farmers increased because even if there is a limited land there will be wheat and timely land preparation then by increase in productivity
Credit access (CRDT_ACS): Access to credit was measured as a dummy variable taking value of 1 if the farmer had access to credit and 0 otherwise. This variable is expected to influence the marketable supply of wheat positively on the assumption that producers use the credit for production purpose. Access to credit would enhance the financial capacity of the farmer to purchase the inputs, thereby increasing wheat production and market share; therefore, access to credit would have positive influence on level of production and sales ADDIN EN.CITE ;EndNote;;Cite;;Author;Abraham;/Author;;Year;2013;/Year;;RecNum;3;/RecNum;;DisplayText;(T Abraham, 2013);/DisplayText;;record;;rec-number;3;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;3;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Abraham, T;/author;;/authors;;/contributors;;titles;;title;Value chain analysis of vegetables: the case of habro and kombolcha woredas in oromia region, Ethiopia;/title;;secondary-title;An MSc Thesis presented to the School of Graduate Studies of Haramaya University. 78p;/secondary-title;;/titles;;periodical;;full-title;An MSc Thesis presented to the School of Graduate Studies of Haramaya University. 78p;/full-title;;/periodical;;dates;;year;2013;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(T Abraham, 2013). ADDIN EN.CITE ;EndNote;;Cite AuthorYear=”1″;;Author;Urgessa;/Author;;Year;2011;/Year;;RecNum;5;/RecNum;;DisplayText;Muhammed Urgessa (2011);/DisplayText;;record;;rec-number;5;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;5;/key;;/foreign-keys;;ref-type name=”Thesis”;32;/ref-type;;contributors;;authors;;author;Urgessa, Muhammed;/author;;/authors;;/contributors;;titles;;title;Market chain analysis of teff and wheat production in Halaba Special Woreda, southern Ethiopia;/title;;/titles;;dates;;year;2011;/year;;/dates;;publisher;Haramaya University;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;Muhammed Urgessa (2011) also found that if pepper and teff producer gets credit, the amount of pepper and teff supplied to the market increased. Therefore, credit access can affect sale volume of wheat marketed positively.

Table SEQ Table * ARABIC 3: measurement and hypothesized relationship of dependent and explanatory variablesVariable Description of variable Types Value Expected sign
WHT_SALE Volume of wheat marketed Continuous Quintal LG-PRICE Lagged market price Continuous ETH Birr/qt +veMRK_DIST Distance to the nearest market Continuous Waking hours -veHH_SEX Sex of the household head
Dummy 1 = if the head is Male +/-veFAMSZ Family size Continuous Number of family +/-veCRDT_ACS credit accesses Dummy ETH Birr +veHH_EDU Education level Dummy 1 = if the head is literate +veEXTCON Extension contact Continuous Number of visit per year +veMRK_ INFO Access to market information Dummy 1 = if the household has access to market information
+ veLND_WHT Land size allocated for wheat Continuous Hectare +veTLU Total livestock holding Continuous TLU +veHH_AGE Age of household head
Continuous Number of year +veSource: Own survey data (2017)
Specification tests
It is important to check multicollinearity problem for continuous and dummy variables before running the model. As Gujarati, (2003) indicates, multicollinearity refers to a situation where it becomes difficult to identify the separate effect of independent variables on the dependent variable because there exists strong relationship among them. In other words, multicollinearity is a situation where explanatory variables are highly correlated. Variance Inflation Factor (VIF) is used to test the existence of multicollinearity for association among the explanatory variables.
Variance inflation factor (VIF) is used to check multicollinearity of continuous variables. As Rj2 increase towards unity, that is, as the collinearity of Xj with the other repressors increase, VIF also increases and in the limit it can be infinite. The larger the value of VIF, the more troublesome or collinear is the variable Xj. As a rule of thumb, if the VIF greater than 10, which will happen if Rj2 is greater than 0.90, that variable is said to be highly collinear ADDIN EN.CITE ;EndNote;;Cite;;Author;Gujarati;/Author;;Year;2003;/Year;;RecNum;17;/RecNum;;DisplayText;(DN Gujarati, 2003);/DisplayText;;record;;rec-number;17;/rec-number;;foreign-keys;;key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″;17;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Gujarati, DN;/author;;/authors;;/contributors;;titles;;title;Basic Econometrics 4th edition McGraw Hill United states Military Academy;/title;;secondary-title;West Point;/secondary-title;;/titles;;periodical;;full-title;West Point;/full-title;;/periodical;;dates;;year;2003;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Gujarati, 2003). Multicollinearity of variables can also be checked using Tolerance. Tolerance is unity if Xj is not correlated with the other explanatory variable, whereas it is zero if it is perfectly correlated with other explanatory variables. The popular measure of multicollinearity is defined as

Where, Rj2 is the multiple correlation coefficients between explanatory variables, the larger the value of Rj2 is, the higher the value of VIF (Xj) causing higher collinearity in the variable (Xj).

On the other hand, contingency coefficient test was used to test multicollinearity among dummy variables. The value ranges between 0 and 1, with 0 indicating no association between the variables and value close to 1 (greater than 0.75) indicating a high degree of association between variables

Where: – CC is contingency coefficient,
X2 is chi-square test and
N is total sample size.

In order to check existence of heteroscedasticity problem in the data set, the parameter estimates of the coefficients of the independent variables cannot be BLUE. Therefore, Breusch-Pagan test of heteroscedasticity which does not require ordering of observations but requires the assumption of normality was employed for detecting heteroscedasticity in this study.
The problem of endogeneity occurs when an explanatory variable is correlated with the error term in the population data generating process, which causes, the ordinary least squares estimators of the relevant model parameters to be biased and inconsistent. The source of endogeneity could be omitted variables, measurement error and simultaneity ADDIN EN.CITE ;EndNote;;Cite;;Author;Wooldridge;/Author;;Year;2010;/Year;;RecNum;18;/RecNum;;DisplayText;(Jeffrey M Wooldridge, 2010);/DisplayText;;record;;rec-number;18;/rec-number;;foreign-keys;;key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″;18;/key;;/foreign-keys;;ref-type name=”Book”;6;/ref-type;;contributors;;authors;;author;Wooldridge, Jeffrey M;/author;;/authors;;/contributors;;titles;;title;Econometric analysis of cross section and panel data;/title;;/titles;;dates;;year;2010;/year;;/dates;;publisher;MIT press;/publisher;;isbn;0262296799;/isbn;;urls;;/urls;;/record;;/Cite;;/EndNote;(Jeffrey M Wooldridge, 2010). If we do not have endogeneity, both OLS and IV are consistent. In order to test problem of endogeneity, Hausman test was employed. The idea of Hausman test is to see if the estimates from OLS and IV are different.
The result of endogeneity test using Hausman test indicated that the variable quantity produced of wheat was endogenous to volume of wheat supplied to market.

RESULTS AND DISCUSSIONThis chapter discusses the major findings of the study derived from primary data/information gathered from main actors of wheat market chain analyzed using both descriptive statistics and econometric models. Descriptive statistics were employed to describe the demographic and socioeconomic characteristics of sample farmers and traders. Moreover, the cost structure and profitability of wheat, production and marketing support services, structure, conduct and performance were studied to measure efficiency of wheat market. Econometric analysis was used to identify factors affecting supply of wheat in the study area.

4.1 Descriptive Statistics4.1.1 Demographic and socioeconomic characteristics of householdsTable SEQ Table * ARABIC 4: descriptive statistics of categorical variablesVariable Categories Quantity supply of wheat to the market
Frequency Percent Mean market supply T/F value
Sex of HHH Household head is male 113 73.38 19.17 4.07***
Household head is Female 41 26.62 9.53 Educational status Household head is  Illiterate 111 72.08 13.06 -3.27***
Household head is  Literate 43 27.92 25.74 Religion Orthodox 154 100.00 16.60 Muslim 0 0 Marital status Household head is  married 136 88.31 1.239
Household head is  single 1 0.65 Household head is  divorced 10 6.49 Household head is  widowed 7 4.55 Source-own survey (2017)
The variables used to describe demographic characteristics of sample farmers were household heads’ sex, age, religion, marital status, education level, family size, experience and ethnicity. The results of the study (Table 4) indicated that 73.38% of wheat producing households was male headed whereas, the remaining 26.62% were female headed household heads. T- Test was employed to depict the association between sex of the respondents and their quantity supply of wheat to the market. The result indicated that there is statistically significant association between sex of the respondents and their quantity supply at p<0.01 significant level (table 4). In terms of marital status, most wheat producing sample households were married (88.31%), and the remaining were divorced (6.49%), widowed (4.55%) and single (0.65%). Additionally, the F- Test of association shows that there is no statistically significant association between the marital status of the household heads and their quantity supply activities. Furthermore, all the wheat producing sample households were orthodox, belonging to Debre Elias ethnic group.
The educational background of the household heads is believed to be an important feature that determines the readiness of household heads to accept new ideas and innovations. More educated farmers are expected to adopt new technologies to increase their land and labor productivity. Based on categorization of education, the data indicated that 72.08 % of the respondents were illiterate and the remaining 27.92 % attained formal education ranging from grade 1 to 12. Additionally, the T- Test of association shows that there is statistically significant association between the educational statuses of the household heads and their quantity supply at less than 1% significant level.
Table SEQ Table * ARABIC 5: descriptive statistics of continuous variablesVariables Mean Std. Dev Correlation coefficient
Age 41.84 11.23 0.0677
Family size 5.188312 1.755549 0.1218
Production experience (years) 20.44805 10.92041 0.1678**
Total livestock unit 7.88 3.3 0.078
Area of own land 1.73 1.12 0.432***
Area of shared in land 0.15 0.36 -0.0305
Area of rent in land 0.77 0.81 0.3293***
Area of shared out land 0.026 0.17 -0.0643
Area of rent out land 0.02 0.15 -0.069
Land allocation of wheat area in hector 1.13 0.87 0.4326***
Frequency of extension contact (number/year) 16.72 8.65 0.059
Distance to nearest market 42.07 19.58 -0.1508
Source-own survey (2017)
Age is the other important characteristics of the community, which reflects on the productivity of the population as it has a bearing on the overall health situation within the community. In developing countries, aged members are more prone to diseases and thus are less productive. It has a bearing on the employment pattern, spatial mobility and quality of work done. Age plays a significant role in any kind of business, particularly in agriculture, because the use of child labor on the farms is quite high. Accordingly, the maximum and minimum age of the respondent was 20 and 78 years respectively with mean age of 41.84 years. From the respondent 86 house holed was less than the mean year and 68 house holed was more than the mean year. Based on table 5 the maximum and the minimum household size were 10 and 1 respectively. The average household size for the surveyed households was 5.188 with a standard deviation of 2.69. From the respondent 89 house holed have less than the average family size and 65 house holed have more than the average family size. The average farm production experience of wheat producing respondents was 20.44 years with standard deviation of 10.92. From the respondent 96 house holed have less than the average farm production experience and 58 house holed have more than the average farm production experience.

Households’ access to productive resources such as land, labor, livestock, etc is essential for agricultural production and marketing. Land is one of the most important factors of production and measure of wealth in the study area. It is the main source of income and increases the status of people in the community. The average size of own land of the respondents was 1.73 ha, rented in (0.77 ha), rented out (0.018 ha), shared-in (0.15 ha) and shared-out (0.026 ha) per household (Table 4). Out of the total land, the respondents allocated most of their plots for wheat production which was an average of 1.13 ha with standard deviation of 0.87 ha. The minimum and maximum size of land allocated for wheat production of the respondent farmers was 0.25 and 5.0 ha respectively. Since the area is known as wheat belt of the country, all of the sample respondents indicated that they are participating in wheat production activity.
Livestock is the farmers’ most important source of income, food and draft or traction power for cultivation of land in the study area. Hence, households with larger livestock holding have better access to draft power than those with less. Livestock holding is also one of the main cash sources to purchase agricultural inputs. To assess the livestock holding of each household, the Tropical Livestock Unit (TLU) per household was calculated (see Appendix Table 1). The livestock holding of households ranged from 1.65 to 19.45 TLU for wheat producers, implying the existence of large variation among the households in livestock ownership. The average livestock holding of wheat producers was 7.88 TLU with standard deviation of 3.30 TLU.
4.2 Access to Markets and other Supportive ServicesAccess to different services has important contribution in improving production and productivity and thereby increasing marketable surplus and ultimately for increasing the income of smallholder farmers. The most important services that are expected to promote production and marketing of wheat in the study area include proximity to markets, access to credit, access to extension service, and access to market information.

Proximity to markets
Regarding the distance taken to travel from home to the nearest market place where they sold their product, sample wheat producing farmers reported as depicted in Table 6 they had to travel an average of 42.07 with standard deviations of 19.58 minutes. The minimum and the maximum distance that sample wheat producing respondents had to travel to access nearest market centers were 5 and 120 minutes respectively.
Access to market information
The amount of marketable surplus depends on access to market information and the willingness, distance from market and ability of farmers to use the information. Access to market information is very limited in the Ethiopian. At the producer level, farmers have extremely limited information on price prevailing (Wolday, 1994). When producers and traders with access to market information can make better decision on how much to produce and market. However, in study area there was no organized market information system to support farmers. As depicted in Table 6, about 61.4% of wheat producing households has better access of market information (price, quality, quantity etc) of wheat market, and the remaining 38.6% has no get market information.

The respondents were also asked about the source of price information. More than 45.74% of wheat producing households reported that they obtained market information from other farmers, while personal observation (35.11%), mobile telephone (14.89%) and coop/union (4.26%).

Table SEQ Table * ARABIC 6: Farmers’ access to markets and other servicesVariables Variable descriptions Quantity supply to the market
frequency
Percent Mean market supply T/F value
MKTINFO household is accessible to market information 94 61.4 7.35 -8.88***
household is inaccessible to market information 60 38.6 31.1 MKTINFOSORCE market information source (MIS) is coop/union 4 4.26 1.33
MIS is other farmers 43 45.74 MIS is telephone 14 14.89 MIS is personal observation 33 35.11 CREDIT household gets credit 51 33.12 15.08 -0.76
household is not accessed to credit 103 66.88 17.36 CREDITFORM household gets credit on-cash 48 94.12 17.97 2.87**
if household gets credit in-kind 3 5.88 4.04 EXTFREQ Frequency of extension contact (number/year) Mean Sta.dva Min Max 16.72 8.65 6 48 DSTNRMAKT Distance to nearest market 42.07 19.58 5 120 Source: Own survey (2017)
Access to credit
Access to credit is one way of improving smallholder farmers’ production and productivity. Farmers’ ability to purchase inputs such as improved seed and fertilizer is tied with access to credit. Farmers with access to credit can minimize their financial constraints and buy inputs more readily than those with no access to credit. Thus, it is expected that access to credit increase the production of agricultural crops in general wheat in particular. In the study area, access to credit is influenced by availability of cash and kind. Farmers access credit from formal (banks, MFI, and cooperatives) and informal sources (Iqub, traders’ friends, relatives and money lenders). Government institutions and NGOs also provide credit to farmers. The Woreda Office of Agricultural and Rural Development and farmers’ service cooperatives were organizations that distribute improved seed and fertilizer on credit. Table 6 shows that only 33.12 % of wheat producing farmers reported that they had access to credit while the remaining majority (66.88 of wheat producing sample respondents) reported that they had no access to input credit that can be used to buy improved seeds and fertilizer.

Access to extension services
Extension service in agriculture is essential and it provides assistance for farmers in improvement of production and productivity, it also enables flow of information and transfer of knowledge and scientific findings to practice. It helps in disseminating new innovations and ideas that emerges from research findings and improves better understanding of technologies that benefit farmer’s production and productivity. In addition, access to agricultural extension services helps facilitate dissemination and adoption of improved technologies and ensure the local availability of these technologies for the majority of smallholders.
Currently in Ethiopia the government has been attempting to fill the required knowledge and achieve food self sufficiency in the country by placing in each Kebele administration three development agents (DAs) and building a farmer training center (FTC). Development agents are assigned as better source of extension services for farmers at kebele level that strengthens intensive method of extension work. The key informant discussions pointed out that most development agents have no time to deliver technical advice to farmers sufficiently. The result in Table 6 above from the sample wheat producing farmers reported that they had extension contact an average of 16.72 with standard deviations of 8.65 times per year whit minimum and maximum of 6 and 48 respectively .
4.3 Farm Inputs utilization
Fertilizer application is one of the most important agricultural practices that are used by wheat growers in the study area. Moreover, proper application of the recommended fertilizer rate is important to obtain the required production and marketable supply. Farmers in the study area use varying fertilizer rate, which is below or above the national level blanket recommended rate.

Table SEQ Table * ARABIC 7: Agricultural input used by wheat producersVariables Variable descriptions Quantity supply to the market
frequency Percent Mean market supply T/F value
DAP Household is used to DAP 154 100 UREA Household is used to Urea 154 100 IMPSED Household is used to improved seed 46 29.87 32.46 6.49***
Household is not used to improved seed 108 70.13 9.85 Herbicides Household is used to Herbicides 154 100 Source of fertilizer Cooperatives/unions 133 86.36 0.196
Agricultural offices 9 5.84 Traders/market 12 7.79 Source of Input seed Cooperatives/unions 37 80.43 41.98***
Agricultural offices 9 19.57 Amount of used kg/ha Minimum Minimum Mean Std. Deviation
DAP used kg/ha 75 150 116.72 21.97
Urea used kg/ha 75 175 134.25 17.14
Seed used kg/ha 100 164 129.29 21.13
Source: own survey result 2017
Although, all sample respondents applied DAP (Di Ammonium Sulphate) fertilizer to produce wheat, the rate of application is higher than the recommendation. As indicated in Table 6, the rate of application of DAPs ranged from 75 kg to 150 kg per hectare for wheat producing farmers. The average rate of DAP fertilizer used for the production of wheat was 116.72 kg per hectare. This table indicated that DAP used per hectare of land was higher than the recommended rate.

UREA is also one of the fertilizer type used in the study area as an input to produce wheat. Although, application of UREA has several advantages beside production increment, all of wheat producing sample respondents applied UREA fertilizer in different rate in the production. The rate of application of UREA ranged from 75 kg to 175 kg per hectare for wheat producing farmers. The average application rate of UREA fertilizer by wheat producers was 134.25 kg per hectare. This figure indicated that UREA used per hectare of land was below the recommended rate.
The wider range of DAP fertilizer application rate by the farmers needs a serious attention. Therefore, training should be provided to the grassroots level farmers in order to narrow the existing knowledge gap. Sample farmers indicated different reasons for applying lower rate of UREA fertilizer. The reason was lack of financial capacity. This was followed by unavailability of fertilizer at the right time. In their view, the amount of fertilizer to be applied per hectare of land depends on intensity of land preparation and fertility status of the plot. The result was assist in revisiting the blanket recommendations for the entire woreda. There is a need to conduct site-specific trails by the farmers themselves.

Improved seed is also one of the most important inputs that determine productivity and production of wheat. However, the potential production response of improved seeds is determined by proper rate of seeds application. As discussed Table 7 above, seeding rate of wheat producers ranged from 100 to 164 kg per hectare. The average seeding rate of wheat producers applied per hectare of land were 129.29 kg with corresponding standard deviation of 21.13kg. Although, the average seeding rates applied per hectare of land of wheat producers were higher than the recommended seed rate, the wider ranges of seeding rate applied by wheat producers require a serious attention. This would require training on the rate of application of seeds and fertilizer to the farmers.

4.4 Production, Storage and Marketing of Wheat
Wheat is the main source of cash income for farmers in the study area, where the production of wheat is nature dependent and rain-fed with only once harvested in a year.

Table SEQ Table * ARABIC 8: Area cultivated, production and productivity of wheatVariables Mean Standard Deviation
Area cultivated for wheat (ha) 1.13 0.87
Quantity produced per HHH(qt) 38.01 25.91
Productivity per ha (qt) 33.73 Amount marketed per HHH (qt 16.60 17.44
Source: Own survey (2017)
Table 8 depicted that the average land allocated for the production of wheat by sample producing respondents was 1.13 hectares with corresponding standard deviation of 0.87 hectares. The minimum and maximum land allocated by sample respondents to the production of wheat was 0.25 and 5 hectare respectively. The average quantity of wheat produced per sample households was 38 quintals but the average productivity of wheat per hectare was 33.7 quintals (Table 8).

In the study area, the average amount of wheat marketed per sample household was 16.6 quintals of wheat were supplied to the market. Sample respondents also reported that the amount wheat marketed per household head varied from 2 to 90 quintals.

It is assumed that supply of wheat exceeds demand in the immediate post harvest period. The glut during harvesting season reduces producer prices and wastage rates can be high. For much of the reminder of the period before the next harvest, the product is usually in short of supply, with traders and consumers having to pay premium prices to secure whatever scarce supplies are available in the market. It is evident that storage plays an important role in balancing supply and demand inters year (within the year) and intra year (between years).

In order for farmer to reduce post harvest losses, there is a need to select appropriate storage systems (types) for wheat. The two major storage systems typically used in the study area are filling in sack’jonia’ and the grain in ”Gota’. ‘Gota’ is made of mud, wet dung and straw usually used by smallholder farmers. Table 8 depicts that 83.77% of wheat producing sample households reported that they stored their wheat by filling the sack ‘jonia’ and the remaining 16.23 % of wheat producing respondents ‘Gota’ that was constructed inside farmers’ homestead in table 8.

Table SEQ Table * ARABIC 9: Type of storage facility, purpose and length of storing wheat
Variables Category Freq. Percent T/F value
Store wheat (yes) Household store wheat 154 100.00 Type of storage facility Sisal sack ‘jonia’ 129 83.77 1.187
‘Gota’ 25 16.23 Reason for storage Expecting high price 66 42.86 1.79
Saving purpose 66 42.86 Lack of market demand 22 14.29 Storage length (month) Mean Std. Dev. 8.76 3.219741 Source: Own survey (2017)
The result from respondents’ shows that, 100% of wheat producing sample farmers avoided sales of their product immediately after harvest. Table 9 also shows that, the average storage time of wheat was 8.76 months. In addition, 42.86% of wheat producing sample households indicated that the major motive behind storing wheat was both expectation of higher price and saving purpose and the remaining 14.29% lack of market demand.

4.5 Wheat Marketing Participants, their Roles and Linkages
This section discusses the different stakeholders that were involved in the wheat marketing chain from the point of production (farm gate) till it reached the final destination (consumers). The results of focus group discussion and key informant interviews indicated that the following are the market participants identified in the transaction process of wheat in the study area such as farmers/producers, farmer traders, urban assemblers, cooperatives, regional retailers, urban retailers, wholesalers, processors (millers, flour mill). In general, the market participants that involved in different activities (such as production, wholesale, retail, assembly, etc) in the study area were summarized into the following categories. .
Producers/farmers are the marketing agents who participate both in production and in marketing of surplus commodities they produce. As the same time, they transport wheat to the nearest markets (village market) or regional markets by themselves, either using pack animals or animal driven carts, or else medium-size Isuzu trucks, over an average distance of 0.42 hours by wheat producers. They had several options to sell their product, selling directly by themselves or selling through broker to assemblers (rural and urban assemblers) and regional wholesalers. Alternatively, they sell to village assemblers known as “farmer traders” who assemble wheat from large number of farmers. Farmers also sell their products directly to the regional wholesalers in regional markets. Some of the farmers also sold their wheat to the consumers in the regional market.

Village markets are defined in this study as markets which are closest to farmers’ residence, having less marketing facilities such as road, electricity, potable water, etc. Farmers sell smaller quantity of wheat on such markets. Whereas regional markets are surplus markets that are found in the woreda town, where most of surplus agricultural products are transacted. Contrary to regional markets, deficit markets that are found in larger towns where most surplus products are flown termed as terminal markets.
Farmer traders/rural assemblers are farmers or part-time traders in the assembly markets who used to buy small quantity of wheat from farmers in village markets during slack period for the purpose of reselling it to consumers or regional wholesalers in either in rural or regional market. They use their financial resources and their local knowledge to buy wheat from the surrounding area.

Urban assemblers play important role in the system of assembly. They consolidate the produce of individual farmers produce and prepare it for marketing. Assemblers not only know the areas of surplus well, but also speak the local language well. On the market days early in the morning they took money from regional wholesalers to buy the produce so that they transfer the purchased product to the trader who already delivered them money on the same market day. Although regional wholesalers are the main customers of urban assemblers, they also sell the product to retailers and consumers.

Wholesalers: Wholesalers are major market participants of the marketing system who usually buy wheat of larger volume than any other actors in the marketing system and resell the products to urban retail merchants and processors than ultimate customers. Wholesalers reside in woreda market town and purchase wheat either through broker or directly from farmer or farmer trader or rural assemblers. Commodities bought from different sources put together in one place (store) to be processed so that uniformity of the product will be attained. Moreover, the processed commodity has been supplied to the deficit terminal markets (Bahir Dar and Adis Abeba,) for sale either directly or through commission agents to the buyer.

Regional retailers are market actors in the final link of the market chain and reside on the woreda town. They buy the wheat from farmers’ customer directly or through broker in the market and on their purchasing and selling verandahs on the days other than the market days.

Urban retailers are persons or companies that sell commodity like raw wheat, wheat flour, etc. to the end users (consumers and processors). They reside in the terminal market and buy the product either from wholesalers or urban assemblers or regional retailers.
Cooperatives/unions are farmers’ service cooperative associations that supply agricultural inputs to farmers in time of production and buy farmers’ agricultural output at harvest. The focus group discussants reported that although existing service cooperatives received enough credits from Bureau of Regional Rural Fund with interest rate of 1.5 percent, they are not efficient enough in terms of timely provisions of agricultural input, buying of their harvested products and financial management. The existence of farmers personnel with poor educational background are not fitting to manage the large volume of fund released from the region.

Millers/processors are the persons or companies that sell commodity like wheat flour to end users (consumers). The surveyed flour processors purchase wheat grain from individual farmers, wholesalers, cooperatives/union and urban retailers within the district.

4.6 Demographic Characteristics of TradersAge is one of the demographic factors that are useful to describe traders experience and networking. As depicted in Table 10, the age of sample traders ranged from 25 to 56 years. The average age of wheat traders was 37.45 years and its standard deviation was 7.099 years. With respect to sex, 83.87% of wheat traders were male the remaining 16.13 % were female. While 87.10% of wheat traders were married and 12.90 % single, 93.55% of sample traders were followed orthodox and the remaining 6.45 % Muslim.

Table SEQ Table * ARABIC 10: Demographic characteristics of tradersVariable Categories Frequency Percent
Sex of HHH traders is  male 26 83.87
traders is female 5 16.13
Educational status traders is illiterate 5 16.13
traders is literate 26 83.87
Religion traders is orthodox 29 93.55
traders is Muslim 2 6.45
Marital status traders is married 27 87.10
traders is single 4 12.90
Age
Mean 37.45 Std. Dev 7.09 Family size Mean 4.13 Std. Dev 1.77 Trade experience in years Mean 8.83 Std. Dev 5.27 Source: Own survey (2017)
Experience plays an important role in improving trading activities and marketing efficiency. The trading experience of sample wheat traders ranges from 3 up to 25 years (Table 10). The average trading experience of sample traders’ respondents was 8.84 years and the standard deviation was 7.27 years. The average family size of all sample traders was 4.13 with standard deviation of 1.77. The family size of sample traders ranges from 1 and 7.

4.6.1 Fixed assets and working capital of tradersThe presence of fixed and liquid assets is important for smooth functioning of the marketing activities. Key players of the market require access to finance to expand their business and improve their performance. This section attempts to discuss issues related to ownership of fixed and liquid assets of traders involved in wheat trading activities.

Table SEQ Table * ARABIC 11: Traders fixed assets and financial resource ownershipVariables Categories Freq. Percent
separate house store Traders have separate house store 18 58.06
Traders have no separate house store 13 41.94
residence store Traders have residence store 13 41.94
Traders have no residence store 18 58.06
mobile telephone Traders have mobile telephone 30 96.77
Traders have  no mobile telephone 1 3.23
weighting scale Traders have weighting scale 17 54.84
Traders have  no weighting scale 14 45.16
Vehicle Traders have Vehicle 8 25.81
Traders have  no Vehicle 23 74.19
Source of 
working capital Own 21 67.74%
Lone 9 29.03%
Gift 1 3.23%
Minimum Maximum Mean Std. Dev.

Separate capacity 100 2500 1283.333 661.99
Residence capacity 5 25 13.77 5.39
Initial working capital 500 4000000 134558.1 717476.2
Current working capital 800 5000000 754548.4 1225788
Source: Own survey data (2017)
Table 11 clearly depicted that about 58.06 % of sample traders reported that they had a separate place to store their produce. Average storage capacity of traders who use a separate storage facility was 1283.333 quintals. With respect to telephone ownership, 96.77% of the sample traders’ respondents had mobile telephones. About 54.84% of the sample trader respondents had their own weighing scale while the remaining traders rented or borrowed weighing scale from other traders. Furthermore about 25.81% of sample wholesalers and processors had their own truck.
Table 11 revealed that the average nominal value of current working capital of sample traders (Birr 754 548.4) was much higher than their initial working capital of Birr 1345 58.1. The initial average working capital of traders ranged from Birr 500 to 4 000000 with the average amount of Birr 134 558.1. Likewise, the amount of traders’ current working capital ranged from Birr 8,000 to 5,000, 000 with an average amount of Birr 754 548.4. Furthermore, 67.77% sample traders used their own capital for trading activities, 29.03% loan from relative/family, banks, Micro finance institution and Friend where as 3.23% gift.

4.7 Wheat Market Channels
A marketing channel is a business structure of interdependent organizations that reach from the point of product origin to the consumer with the purpose of moving products to their final consumption destination (Kotler and Armstrong, 2003). It starts with growers and end on consumers ADDIN EN.CITE <EndNote><Cite><Author>Khushk</Author><Year>2004</Year><RecNum>15</RecNum><DisplayText>(AM Khushk &amp; AD Sheikh, 2004)</DisplayText><record><rec-number>15</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>15</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Khushk, AM</author><author>Sheikh, AD</author></authors></contributors><titles><title>Structure, conduct and performance of the marketing system, margins and seasonal price variation of selected fruits and vegetables in Pakistan</title><secondary-title>Tandojam: Technology Transfer Institute, Sindh</secondary-title></titles><periodical><full-title>Tandojam: Technology Transfer Institute, Sindh</full-title></periodical><dates><year>2004</year></dates><urls></urls></record></Cite></EndNote>(Khushk & Sheikh, 2004). Furthermore, the analysis of marketing channels is intended to provide a systematic knowledge of the flow of the goods and services from their origin (producer) to the final destination (consumer).

Hence, the wheat market channels in the study area were constructed (Figure 1) based on the data/information collected from the whole chain actors. Among 18 lines of market channels identified, three of them went outside the region and the rest 14 were inside. The main receivers from farmers were wholesalers, urban assemblers, processors, farmer traders, cooperatives, regional retailers, and consumers with an estimated percentage share of 42.2, 35.3, 6.9, 6, 5, 3.6, and 1 percent in order. This implies that wholesalers and urban assemblers are the main actors who sourced wheat directly from farmers.

The analysis of channel is intended to provide a systematic knowledge of the flow of goods and services from their origin to the final destination (consumer). The total quantity produced by farmers was about 5853 quintal and the total quantity supplied to the market is 2557 quintal from sampled farmers.
Based on the estimation of volume of wheat flown in the marketing channels (Figure 1), wholesalers and urban assemblers are the main actors sourcing wheat directly from farmers with a share of 42.2 and 35.3% respectively. Farmer traders, regional retailers, cooperatives, processors, and consumers together received the remaining 22.5%. Processors in wheat marketing channel represent flour mills’ owners who buy only quality wheat. The result revealed that the following are the major marketing channels identified in terms of quantity of wheat flowed in 2016/17 from producer to consumer passing through different intermediaries:
Channel 1: Producers-consumers (1%) and 25.57 quChannel 2: Producers-regional retailers-consumers (3.6%) and 92.052 quChannel 3: Producers- urban assemblers-urban retailers-consumers (5.61%) and 143.5 quChannel 4: Producers-urban assemblers-urban retailers-processer-consumers (3.21%) and 82.14 quChannel 5: Producers-urban assemblers-wholesalers-out of the region (14.48%) and 370.15 quChannel 6: Producers- urban assemblers -wholesalers-urban retailers-consumers (3.42%) and 87.40 quChannel 7: Producers-urban assemblers-wholesalers-urban retailers-processor -consumers (1.96%) and 50.11 quChannel 8: Producers- urban assemblers-wholesalers-processer-consumers (6.62%) and169.24qu
Channel 9: Producers-farmer traders-wholesalers-out of the region (3.28%) and 83.92 qu
Channel 10: Producers- farmer trader -wholesalers- urban retailers-consumers (0.8% and 20.01 quChannel 11: Producers- farmer trader -wholesalers- urban retailers- processer –consumers 0.44% and 11.34 quChannel 12: Producers- farmer trader -wholesalers- processer –consumers (1.5%) and 38.36 quChannel 13: Producers- processer –consumers (6.9%) and 176.4 quChannel 14: Producers- cooperative- union- processer –consumers (5%) and 127.85 quChannel 15: Producers- wholesalers- out of the region (23.08%) and 590.24 quChannel 16: Producers- wholesalers- urban retailers-consumers (5.45%) and 139.31 quChannel 17: Producers- wholesalers- urban retailers- processer –consumers’ 3.12% and 79.73 quChannel 18: Producers- wholesalers- processer –consumers (10.55%) and 269. 76 quProducers (2557 quintal)

3.6 % 35.3 % 42.2% 6 % 6.9% 5% 1%
Cooperative

Farmer traders
Urban assemblers

100%
Union
25% 75% 100%

Wholesalers
54.7%100%

Urban retailers
20.3% 25%
Regional retailers

Processors
36.4%
63.6%
100% 100%
Consumers

Figure 4. SEQ Figure * ARABIC 2: wheat marketing channelsSource own survey result 2017
4.8 Analysis of Structure, Conduct and Performance of Wheat
4.8.1 Structure of the wheat marketIn agricultural marketing studies, market structural characteristics are used as a basis for classification of three categories of market: competitive, oligopolistic and monopolistic. For this study, wheat market structure was evaluated using degree of market concentration, barrier to entry (licensing procedure, lack of capital and know how, and policy barriers), and the degree of transparency ADDIN EN.CITE <EndNote><Cite><Author>Roduner</Author><Year>2004</Year><RecNum>6</RecNum><DisplayText>(Daniel Roduner, 2004)</DisplayText><record><rec-number>6</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>6</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Roduner, Daniel</author></authors></contributors><titles><title>Report on Value Chains: Analysis of existing theories, methodologies and discussions of valuechain approaches within the development cooperation sector, prepared for SDC by DanielRoduner</title><secondary-title>Swiss Centre for Agricultural Extension and Rural Development (AGRIDEA)</secondary-title></titles><periodical><full-title>Swiss Centre for Agricultural Extension and Rural Development (AGRIDEA)</full-title></periodical><dates><year>2004</year></dates><urls></urls></record></Cite></EndNote>(Roduner, 2004).

Degree of market concentration
According to Kohls and Uhl (1985) Market concentration, the portion of the industry sales made by the largest firms, is another source of imperfect competition. In general, the higher the level of market concentration, the less perfectly competitive the market is.

The concentration ratio is expressed in terms of CRx, which stands for the percentage of the market sector controlled by the biggest X firms. Four firms (CR4) concentration ratio is the most typical concentration ratio for judging the market structure (Kohls and Uhl, 1985). A CR4 of over 50% is generally considered as strong oligopoly; CR4 between 33% and 50% is generally considered a weak oligopoly and a CR4 of less than 33% is unconcentrated market.

For these study in Table 11 depicted that major actors which participate in wheat buying and selling activity was taken for considering market structure. Calculation of the concentration ratio by considering an average volume of wheat handled by largest wholesaler per week in peak production season basing the four firm criteria indicated the existence of oligopoly market power. Four firms control 70.25% of the total amount of wheat sold in market during peak production season at Debre Elias town where wholesales of the commodities were significantly involved. Hence, it is concluded that wheat market at woreda level is inefficient and non competitive.
Similarly ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Urgessa</Author><Year>2011</Year><RecNum>5</RecNum><DisplayText>Muhammed Urgessa (2011)</DisplayText><record><rec-number>5</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>5</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Urgessa, Muhammed</author></authors></contributors><titles><title>Market chain analysis of teff and wheat production in Halaba Special Woreda, southern Ethiopia</title></titles><dates><year>2011</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Muhammed Urgessa (2011) market chain analysis of Teff and wheat production in halaba special woreda, depicted that the four largest Teff and wheat traders possess 65 and 71.5 % of the total volume of purchase in Alaba Qulito showed an oligopolistic market respectively. ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Usman</Author><Year>2016</Year><RecNum>10</RecNum><DisplayText>Sultan Usman (2016)</DisplayText><record><rec-number>10</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>10</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Usman, Sultan</author></authors></contributors><titles><title>Analysis of wheat value chain: The case of Sinana District, Bale Zone, Oromia Region, Ethiopia</title></titles><dates><year>2016</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Sultan Usman (2016) for the study of analysis of wheat value chain: the case of Sinana district Four firms control 88.7% of the total amount of wheat sold in market. Hence, it is concluded that wheat market at woreda level is oligopolistic market.
Table SEQ Table * ARABIC 12: Concentration ratio of top four tradersTrader Total volume of product handled per week (quintal) Market share (%)
1 50 5.95
2 60 7.14
3 70 8.33
4 70 8.33
5 100 11.91
6 140 16.67
7 150 17.86
8 200 23.81
Total 840 Source own survey result (2017)
C4= C1+C2+C3+C4=70.25%
Degree of market transparency
It is widely accepted that, accurate and timely market information enhances market performance by improving the knowledge of buyers and sellers concerning supply and demand. Exclusive access to market information or the control or concentration of information asymmetry and concentration of capital at the disposal of very few traders is important sources of monopoly which affects the nature of horizontal and vertical relations. More balanced knowledge of the markets provides a fair distribution of the gains from efficient market price formation ADDIN EN.CITE <EndNote><Cite><Author>Timmer</Author><Year>2009</Year><RecNum>8</RecNum><DisplayText>(C Peter Timmer, 2009)</DisplayText><record><rec-number>8</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>8</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Timmer, C Peter</author></authors></contributors><titles><title>Rice price formation in the short run and the long run: The role of market structure in explaining volatility</title></titles><dates><year>2009</year></dates><urls></urls></record></Cite></EndNote>(Timmer, 2009).

However, even though information plays such a crucial role in improving the marketing system, there was no organized system to provide reliable market information to all market participants in the study area. Hence, traders used different approaches to access market information. According to the survey result, about 96.67% and 3.33 % of sample traders obtained price information through telephone and from other traders in the market respectively. Although, Medias such as television and radio play the greatest role in provision of market information in shortest possible time over larger area of coverage, its effect in addressing grain market information to users was very limited. Despite the fact that, no trader had accessed mass Medias as an information source.

Since sources and means of obtaining information by different categories of traders varied significantly, the timeliness and quality of information obtained depends on the traders’ access to market information channels and their individual judgment on the level of supply, demands and prices collected from different sources and in different times. However, information provided by traders was not up-to date and mostly not true. They used to depress price of products down by delivering historical and biased information to producers.

Barrier to entry
Licensing: According to the survey result all traders involved in wheat buying and selling activity had trade license except informal rural assemblers. They paid some amount of money every year as per the Inland Revenue decision. Wholesalers buy wheat and transport to different marketing routes such as Addis Abeba, Bahir Dar, Debre Markos, and Dejjen. However, retailers and assemblers indicated shortage of capital limited them from expanding their business venture.
Although, theoretically it is compulsory to have licensed to enter into the grain market, the simplicity to have grain license and absence of strong restriction to enter into the grain market with respect to licensing made grain marketing relatively free to enter. Traders explained that informal rural assemblers (which do not own license) were involved in buying and selling of wheat especially during peak production season and high demand time. There is no strong regulatory action that controls non licensed market participant at kebele level and small towns in the woreda. Similarly ADDIN EN.CITE ;EndNote;;Cite AuthorYear=”1″;;Author;Usman;/Author;;Year;2016;/Year;;RecNum;10;/RecNum;;DisplayText;Sultan Usman (2016);/DisplayText;;record;;rec-number;10;/rec-number;;foreign-keys;;key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″;10;/key;;/foreign-keys;;ref-type name=”Thesis”;32;/ref-type;;contributors;;authors;;author;Usman, Sultan;/author;;/authors;;/contributors;;titles;;title;Analysis of wheat value chain: The case of Sinana District, Bale Zone, Oromia Region, Ethiopia;/title;;/titles;;dates;;year;2016;/year;;/dates;;publisher;Haramaya University;/publisher;;urls;;/urls;;/record;;/Cite;;/EndNote;Sultan Usman (2016) the survey result, all wholesalers involved in wheat buying and selling activity were licensed.

Capital: Capital requirements serve as an entry barrier because only those who can afford such a monetary can enter the market. In order to handle reasonable quantity of the commodity, traders need sufficient amount of money that assists their business to operate in healthy way. According to the survey result, about 19.35 % of the sample traders identified that lack of capital is one of the major entry barriers to enter in to wheat trading. In addition, the sample traders reported that lack of access to credit has been the single most critical constraint in the start-up and expansion phases. Some of them explained that higher interest rate limited them from taking credit. About 67.74 %, 29.03% and 3.23% of sample traders were using their own capital, borrowing from other traders and friends and gift respectively. Thus, access to capital was one of the factors discouraging entry into grain trading. But government policy is one of the major factors discouraging entry into grain trading. That mines increasing year to year tax and other current political system is the major ones.
Lack of trading experience: according to the survey result, trading experience of sample traders ranges from 3 to 25 years with an average experience of 8.84 years. The presence of wider range of experience years among traders indicates that experience is not a barrier to enter into grain market.

4.8.2 Conduct of wheat trading
In this section the conduct of wheat traders is analyzed in terms of the producer and trader’s price setting, purchasing and selling strategies.

Producers Price setting strategy

Figure 4. SEQ Figure * ARABIC 3: Producers Price setting strategy
Source: Own survey data (2017)
According to the survey result from the above figure, about 69.48% of sample farmer respondents reported that market price was set by traders or buyers. And 18.84% respondents reported that price was set by through negotiation and haggling with traders. The remaining 6.49 % and 5.19 % of farmer respondents reported that the selling price of their produce was set by themselves and by market respectively. The survey further confirmed that, about 17.2% of sample respondent face problem of low price they took their product back to home and waited till next market day. The other 72.6 % of sample respondents sold their product with the existing price. The remaining 10.2% put their produce in homes of their relatives on market place to be sold some other day other than the market day. All of the respondents confirmed that price was the determining factor which influences them for whom to sell among the buyer. Hence, there existed absence of competitive pricing system, indicating the deviation of market from the competitive market norms. Additionally, respondents pointed out that some traders cheat on weighing scales by manipulating installations of the instrument. Once they identify traders behaving like this, they will not sell to him/her again. Similarly ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Usman</Author><Year>2016</Year><RecNum>10</RecNum><DisplayText>Sultan Usman (2016)</DisplayText><record><rec-number>10</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>10</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Usman, Sultan</author></authors></contributors><titles><title>Analysis of wheat value chain: The case of Sinana District, Bale Zone, Oromia Region, Ethiopia</title></titles><dates><year>2016</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Sultan Usman (2016) the survey result all of the respondents confirmed that price was the determining factor which influences them for whom to sell among the buyer outlet choices.
Buying and selling strategy of traders
Table SEQ Table * ARABIC 13: Average number of markets visited by traders per weekTrader type Minimum Maximum Mean St. dev
All traders 2 7 3.77 1.87
Farmer traders 2 5 2.83 1.33
Urban assemblers 2 5 2.71 1.11
Wholesalers 3 6 5.56 1.01
Urban retailers 2 6 4.67 2.31
Regional retailers 2 2 2 0
Processers 7 7 7 0
Source: Own survey data (2017)
According to the survey result, the number of market visited per week by the sample traders during purchase ranges from 2 to 7 markets. And the average number of markets visited per week by all traders was 3.77 with standard deviation of 1.87. As clearly presented in Table 13 Processers visited the highest average number of market per week (7) followed by wholesalers (5.56).

On the other hand, the survey result of figure 3 revealed that about 22.58% of traders responded that selling price was set by negotiation with buyers of the product they offered. While the rest 22.58 % and 54.84% of the respondents said that selling price was set by buyer and the market respectively.

Figure 4. SEQ Figure * ARABIC 4: traders selling priceSource: Own survey data (2017)
Traders used different marketing agents to sell their product in the market. Based on the survey result about 20.06% of sample traders reported that they personally in charged to sale. Whereas 22.6% and 4.6% of traders used their family member and commission agents respectively at the time of sale. The rest 52.74 % of traders sold their product through combination of themselves with commission agents.

With regard to the payment mode while sample traders sold their product, the survey result in figure below depicted that about 42% of sample traders sold their product on cash and credit. Around 30.2% of traders sold their product through cash only. Few of the traders 4.6% sold though credit. And the remaining 23.2% of sample respondents sold their product though combination of cash, advanced payment and credit.

Figure 4. SEQ Figure * ARABIC 5: payment mode sample traders sold their productSource: Own survey data (2017)
4.8.3 Analysis of market performance
Marketing performance of wheat markets were analyzed by estimating the marketing margin, by taking into consideration associated marketing costs for key marketing channels. Based on production costs and purchasing prices of the major market participants along the chain, margins at farmer, urban assemblers, wholesalers and urban retailer’s levels were estimated and analyzed.

Marketing margin
Marketing margin is one of the commonly used measures of the performance of a marketing system. It is the difference between prices at two market levels. The term market margin is most commonly used to refer to the difference between producer prices of an equivalent quantity and quality of a commodity. However, it may also describe price differences between other points in the marketing chain, for example, between producer and wholesale, or wholesale and retail, prices (Spencer, 1971). Marketing margin is the percentage of the final weighted average selling price taken by each stage of the marketing chain. The margin covers costs involved in transferring produce from one stage to the next and provides a reasonable return to those doing the marketing. It can be interpreted as a cost of providing a mix of marketing services. Computing the total gross marketing margin (TGMM) is always related to the final price or the price paid by the end consumer, expressed in percentage ADDIN EN.CITE ;EndNote;;Cite;;Author;Mendoza;/Author;;Year;1995;/Year;;RecNum;10;/RecNum;;DisplayText;(Meyra Sebello Mendoza ;amp; Mark W Rosegrant, 1995);/DisplayText;;record;;rec-number;10;/rec-number;;foreign-keys;;key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”;10;/key;;/foreign-keys;;ref-type name=”Journal Article”;17;/ref-type;;contributors;;authors;;author;Mendoza, Meyra Sebello;/author;;author;Rosegrant, Mark W;/author;;/authors;;/contributors;;titles;;title;Pricing conduct of spatially differentiated markets;/title;;secondary-title;PricesProducts and people: Analyzing agricultural markets in developing countries;/secondary-title;;/titles;;periodical;;full-title;PricesProducts and people: Analyzing agricultural markets in developing countries;/full-title;;/periodical;;pages;343-360;/pages;;dates;;year;1995;/year;;/dates;;urls;;/urls;;/record;;/Cite;;/EndNote;(Mendoza ; Rosegrant, 1995).
Therefore, in wheat marketing margins were analyzed based on the average sale price of different marketing agents in the marketing channels of producers, urban assemblers, wholesalers and urban retailers. To give detail information on analysis of marketing margins of wheat.

Table SEQ Table * ARABIC 14: Marketing margins of wheat production in different channels
Market actors/ participant Market channel
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
GMMp94.84 81.63 70.26 89.49 81.63 70.76 70.26 85.96 78.21 67.49 67.49 88.54 55.49 90.14 82.22 70.76 70.76
GMMft- – – – – – 4.08 3.52 3.03 3.03 – – – – – –
GMMrr5.16 – – – – – – – – – – – – – – –
GMMua- 7.76 6.68 5.06 7.76 5.06 6.68 – – – – – – – – – –
GMMco- – – – – – – – – – – 13.01 – – – –
GMMu- – – – – – – – – – 8.44 – – – –
GMMw- – 5.73 5.23 4.5 4.5 10.38 9.47 8.15 8.15 – – 9.86 12.99 11.18 11.18
GMMur- 14.01 12.06 – 8.78 7.56 – – 8.78 7.56 – – – – 8.78 7.56 –
GMMpro- – 13.93 – – 11.23 21.49 – – 13.93 21.49 32.68 11.23 – – 13.93 21.49
TGMM 5.16 18.37 29.74 10.51 18.37 29.24 29.74 14.04 21.59 32.51 32.51 11.46 44.51 9.86 17.78 29.24 29.24
Source: Own survey data (2017)
Note: GMMp, GMMft, GMMrr, GMMua, GMMco, GMMu, GMMw, GMMpr, and GMMca means gross marketing margins for producers, farmer trader, rural retailers, urban assemblers, cooperatives, union, wholesalers and processors respectively.

The survey results in Table 14 showed that, the total gross marketing margin (TGMM) was highest in Channel 14 and it was 44.51% of the consumers’ price followed by both channel 11 and 12 which accounted for 32.51% of the consumers’ price. From all wheat actors, producers have got the highest gross marketing margin it accounted for 94.84 % in channel 2 and local collectors/ farmer trader have got the lowest gross marketing margin which is accounted for 3.03 % both in channel 11 and 12 respectively.

4.9 Analysis of Wheat Profitability
4.9.1 Producers’ profitability analysis
Whenever profitability analysis of any activity is under taken, production costs and revenues (benefits) obtained must be included in the analysis. In the case of wheat, production costs are costs related to production and production process. In economics terms these costs are termed as either fixed or variable costs a farmer incurred in the production and production process of wheat. Fixed costs are costs that do not change with a change in output (production). On the other hand fixed costs simply mean costs incurred regardless of the presence or absence of production. Land rent, oxen rent are some of the fixed costs a farmer incurred in the study area. However, variable costs are costs that are liable to change with a change in production. These are costs of fertilizer, seeds, chemical herbicides, labor costs etc
Table SEQ Table * ARABIC 15: Cost structures and profitability of sample farmers (N= 154)Lists of Expenses Birr per ha
Oxen rent and Tillage 1906.167
Weeding/herbicides 99.42
Harvesting and Threshing 2698.79
Transportation 337.35
Laborers 278.39
Fertilizer for DAP 1187.12
Fertilizer for UREA 1182.96
Seed 1098.65
Sack 202.41
Total cost (A) 8991.25
Average qt produced per ha 33.73
Revenue from wheat 12104.58
Revenue from wheat straw 347.40
Total revenue(B) 12451.9
Net revenue(B-A) 3460.65
Source: Own survey (2017)
First, in order for sample farmers understood well the detailed production cost structure and profitability of wheat production, data were collected on the bases of ‘timad’ unit which is equal to quarter of a hectare. Later on for the purpose of data analysis and readers understanding the ‘timad’ units were converted in to hectare so that it can fulfill the standard unit of measurement.

As presented in Table 15, the survey result indicated that the average productivity of wheat production in the survey area was 33.73 quintals per hectare. The average cost of production per hectare was Birr 8991.249 (266.57 ETB per quintal) for wheat.
The total revenue obtained from the production of wheat per hectare was simply estimating the sum of average revenue from wheat and average revenue from wheat straw a farmer received in the production year. The total revenue a sample farmer owned from hectare of land from production of wheat was Birr 12451.9. Subtracting the average production costs i.e. 8991.249 from the value of total revenue it would reach positive net revenue of Birr 3460.651 (102.6 ETB per quintal) for wheat per hectare. This showed the profitability farm business. Higher productivity and profitability made wheat production more competitive implying that the need for encouragement of wheat production in the study area from economic as well as food security perspective. Similarly ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Urgessa</Author><Year>2011</Year><RecNum>5</RecNum><DisplayText>Muhammed Urgessa (2011)</DisplayText><record><rec-number>5</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>5</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Urgessa, Muhammed</author></authors></contributors><titles><title>Market chain analysis of teff and wheat production in Halaba Special Woreda, southern Ethiopia</title></titles><dates><year>2011</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Muhammed Urgessa (2011), Market Chain Analysis of Teff and Wheat Production in halaba Special Woreda and ADDIN EN.CITE <EndNote><Cite><Author>Usman</Author><Year>2016</Year><RecNum>10</RecNum><DisplayText>(Sultan Usman, 2016)</DisplayText><record><rec-number>10</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>10</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Usman, Sultan</author></authors></contributors><titles><title>Analysis of wheat value chain: The case of Sinana District, Bale Zone, Oromia Region, Ethiopia</title></titles><dates><year>2016</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>(Sultan Usman, 2016) Analysis of Wheat Value Chain: the case of Sinana District, Bale Zone both is stated that wheat production is profitable.

4.9.2 Profitability analysis of wheat traders
Table 16 clearly depicted analysis of profitability of the different traders of wheat namely farmer traders/rural assemblers, urban assembler, regional wholesaler, regional retailer, urban retailers and processers described in detail across the markets. During analysis of profitability, the average purchased price of a quintal of wheat and the different average transaction costs associated with the marketing process of a single quintal till it reached the next dealer was assessed.

As a survey result indicates, the amount of average transaction costs incurred across traders varies. Accordingly, the total costs incurred by farmer traders, urban assemblers, regional wholesalers, regional retailers, urban retailers and processers of wheat were Birr 16.49, 23.67, 25.02, 21.71, 30.01 and 66 in the same order until possession is transferred to the next marketing agent. The survey result also indicated that the amount of transaction costs per quintal incurred by farmer traders Birr 18.5 for wheat. Since buying and selling of the product by farmer traders had taken place on their nearby village market, they were not liable to different costs associated with marketing process. As a result, Farmer traders exercised lowest average transaction costs per quintal than any other traders. The survey result also indicated that the amount of transaction costs per quintal incurred by processers for wheat was Birr 74. Processers transaction cost was higher than any other sample trader. This could be due to higher costs related to permanent and temporary workers and transportation of the product during product preparation.

With respect to the profitability of the commodity, the overall average profitability of wheat across the different markets indicates that at every stage of transaction, trading business was profitable. However, Table 16 revealed that processers were traders who obtained the highest net profit per quintal than that was 66 ETB. Farmer traders obtained least net profit per quintal. Similarly ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Urgessa</Author><Year>2011</Year><RecNum>5</RecNum><DisplayText>Muhammed Urgessa (2011)</DisplayText><record><rec-number>5</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>5</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Urgessa, Muhammed</author></authors></contributors><titles><title>Market chain analysis of teff and wheat production in Halaba Special Woreda, southern Ethiopia</title></titles><dates><year>2011</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Muhammed Urgessa (2011) Market Chain Analysis of Teff and Wheat Production in halaba Special Woreda and ADDIN EN.CITE <EndNote><Cite><Author>Usman</Author><Year>2016</Year><RecNum>10</RecNum><DisplayText>(Sultan Usman, 2016)</DisplayText><record><rec-number>10</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>10</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Usman, Sultan</author></authors></contributors><titles><title>Analysis of wheat value chain: The case of Sinana District, Bale Zone, Oromia Region, Ethiopia</title></titles><dates><year>2016</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>(Sultan Usman, 2016) Analysis of Wheat Value Chain: the case of Sinana District, Bale Zone both is stated that wheat trade is profitable for all traders.

Table SEQ Table * ARABIC 16: Analysis of profitability of wheat traders (Br/Q)Lists of average costs Farmer traders Urban assemblers Regional wholesaler Regional retailer
Urban retailers Cooperative Union Processers
Purchase price 823.33 857.14 863.33 821.33 996.66 677 760 1080
Sack price 6 6.14 7 6.6 7 7 6 15
Loading unloading 0 1.71 4.67 0 2.67 3 3 7
Broker / commission man fee 0 0.86 1.89 0.2 1.33 0 1 3
Transportation 6.67 6.43 43.33 8 5 10 12 20
Storage 0.17 0.86 1.33 0 1 2 2 2
Infrastructure 0.67 1 1 0.8 1 1 1 4
Permanent and temporary workers 3.5 5.57 7 4.4 4.33 18 17 20
Other costs 1.5 1.43 3.2 1 1 2 1 3
Total cost 18.51 24 69.42 21 23.33 43 43 74
Selling price 858.33 902.85 957.77 866 1050 760 863 1220
Net profit 16.49 21.71 25.02 23.67 30.01 40 60 66
Source: Own survey data (2017)
4.10 Econometrics Model Results
In this section factors affecting volume of wheat supplied to market are presented and discussed.
4.10.1 Determinants of market supply
In the study area, factors that determine supply of wheat to the market was estimated using OLS model since all respondents used for this study supplied their wheat to the market. The hypothesized variables that were assumed to influence marketable supply were: Access to market information, Extension Contact, access to credit service, livestock (TLU), quantity produced of wheat, sex of the household head, educational level of household head, total family size, size of land allocated for wheat production, distance from the nearest market and age of household head.
Robust regression option was used in STATA to analyze and correct heteroscedasticity problem. Multicollinearity problem was also tested using VIF. The result indicated no multicollinearity problem since VIF was less than 10 (Annex Table 3). Test of endogeneity showed that there is no endogeneity problem the quantity of wheat produced is endogenous to the model (F=2.41258 (p= 0.1226) (Annex Table 4) and also taste omitted variables by using OVTEST the result indicated no omitted variables since Prob > F = 0.1054 (Annex Table 5). The independent variables included for analysis explained 43% of the variation in dependent variable. In addition to the above tests this model satisfies normality (Annex Table 5).

Quantity produced of wheat: It is the total amount of wheat produced in quintals in 2016/17 production season in the study area. It was hypothesized that quantity produced of wheat affects marketable supply positively. Accordingly the result indicated that quantity of wheat produced affects market supply positively and significantly at 1% probability level. Positive sign of coefficients indicate that farmers who produce more quantity of wheat supply increase volume of marketable supply. The result shows that a one quintal increase in the wheat production causes a 0.383 quintal increase in the volume of marketable supply of wheat. ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Usman</Author><Year>2016</Year><RecNum>10</RecNum><DisplayText>Sultan Usman (2016)</DisplayText><record><rec-number>10</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>10</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Usman, Sultan</author></authors></contributors><titles><title>Analysis of wheat value chain: The case of Sinana District, Bale Zone, Oromia Region, Ethiopia</title></titles><dates><year>2016</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Sultan Usman (2016) found that the amount of wheat produced by farming households has augmented marketable supply of the commodities significantly. ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Abraham</Author><Year>2013</Year><RecNum>3</RecNum><DisplayText>T Abraham (2013)</DisplayText><record><rec-number>3</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>3</key></foreign-keys><ref-type name=”Journal Article”>17</ref-type><contributors><authors><author>Abraham, T</author></authors></contributors><titles><title>Value chain analysis of vegetables: the case of habro and kombolcha woredas in oromia region, Ethiopia</title><secondary-title>An MSc Thesis presented to the School of Graduate Studies of Haramaya University. 78p</secondary-title></titles><periodical><full-title>An MSc Thesis presented to the School of Graduate Studies of Haramaya University. 78p</full-title></periodical><dates><year>2013</year></dates><urls></urls></record></Cite></EndNote>T Abraham (2013) also found that the amount produced of tomato, potato and cabbage significantly affects quantity supplied to market positively.
Access to market information (ACCMKINF): market information access is also another factor, which positively affects quantity supply of wheat at 5% significance level. The positive and significant relationship between variables indicate that as farmers accessed market information, the quantity of wheat sold at market also increases. The coefficient also confirmed that accessing market information to farmers will tend to increase the marketable supply of wheat by 5.52 quintals. The implication is that obtaining and verifying information helps to supply more quantity of wheat. Similarly ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Urgessa</Author><Year>2011</Year><RecNum>5</RecNum><DisplayText>Muhammed Urgessa (2011)</DisplayText><record><rec-number>5</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>5</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Urgessa, Muhammed</author></authors></contributors><titles><title>Market chain analysis of teff and wheat production in Halaba Special Woreda, southern Ethiopia</title></titles><dates><year>2011</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Muhammed Urgessa (2011) also revealed that access to market information of the household head is one of the factors that affect the probability of marketable supply of teff positively in Halaba special Woreda.

Lagged market prices (LMPW): From the time when wheat price is high in the market in the previous year, farmers would be interested to produce and supply more. As it was hypothesized, significant effect. This variable had a positive and significant effect at 5% level. The regression coefficient of this variable shows that one Birr increases in previous year market prices leads to 0.035 increase in the volume of marketed. The study of ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Ketema</Author><Year>2014</Year><RecNum>11</RecNum><DisplayText>Mengistu Ketema and Haymanot Asfaw (2014)</DisplayText><record><rec-number>11</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>11</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Ketema, Mengistu</author><author>Asfaw, Haymanot</author></authors></contributors><titles><title>Durum Wheat Value Chain Analysis: The Case of Gololcha District of Bale Zone, Ethiopia</title></titles><dates><year>2014</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Mengistu Ketema and Haymanot Asfaw (2014) argued that the lag product price has direct relations with marketable supply of Durum Wheat Value Chain Analysis the case of Gololcha District.

Number of obs = 154
R-squared = 0.4394 Prob > F = 0.0000
F (12, 141) = 9.76 Root MSE = 11.836
Table SEQ Table * ARABIC 17: OLS estimation results of Determinants of volume of wheat marketed supply.
Variables Coef. Robust
Std. Err. T P>t
Sex HH 0.36 1.985 0.18 0.858
Age of HH -0.01 0.084 -0.08 0.938
Education HH 4.07* 2.436 1.67 0.097
Total family Size 0.16 0.891 0.18 0.855
Total Livestock Unit 0.23 1.24 0.19 0.851
Land size of wheat 4.10* 2.125 1.93 0.056
Quantity produced of wheat 0.38*** 0.128 2.98 0.003
Lag Price 0.035** 0.014 2.49 0.014
Take Credit 5.27* 2.887 1.83 0.070
Extension Contact 0.22 0.137 1.61 0.110
Distance to Nearest Market -0.03 0.022 -1.27 0.207
Market Information 5.52** 2.72 2.03 0.045
_cons -44.26 10.31 -4.29 0.000
Source: Own survey (2017) ***, ** and * significant at 1, 5 and 10% respectively
Take credit (CRD-TAK): As the multiple regression model result indicates, the variable take to credit had positive and significant influence on volume of wheat supply at 10% significance level. From this result it can be stated that those farmers who have take to formal credit, are more probable to supply marketable wheat than those who have no take to formal credit. The coefficient also confirmed that take to formal credit to farmers will tend to increase the marketable supply of wheat by 5.27 quintals. Similarly ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Ketema</Author><Year>2014</Year><RecNum>11</RecNum><DisplayText>Mengistu Ketema and Haymanot Asfaw (2014)</DisplayText><record><rec-number>11</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>11</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Ketema, Mengistu</author><author>Asfaw, Haymanot</author></authors></contributors><titles><title>Durum Wheat Value Chain Analysis: The Case of Gololcha District of Bale Zone, Ethiopia</title></titles><dates><year>2014</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Mengistu Ketema and Haymanot Asfaw (2014) argued that take to credit has direct relations with marketable supply of Durum Wheat Value Chain Analysis the case of Gololcha District.

Size of land allocated for wheat production: It is a continuous variable refers to the total area of farmland a farmer allocated for wheat production. It is assumed that the larger land is allocated for wheat production the higher would be the output that influences large quantity of wheat supplied to market. So it is hypothesized that size of land allocated for wheat production positively and significantly at 10% probability level influences volume of wheat supplied to market. As the area of land allocated by farmer increased by one hectare, the quantity of wheat supplied to market would increase by 4.2 quintals. The finding by ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Usman</Author><Year>2016</Year><RecNum>10</RecNum><DisplayText>Sultan Usman (2016)</DisplayText><record><rec-number>10</rec-number><foreign-keys><key app=”EN” db-id=”r0p2vesd59faf7etsv2ve5pepxxreta2rav5″>10</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Usman, Sultan</author></authors></contributors><titles><title>Analysis of wheat value chain: The case of Sinana District, Bale Zone, Oromia Region, Ethiopia</title></titles><dates><year>2016</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Sultan Usman (2016) found that a unit increase in land allocated for wheat, would give rise to 4.25qt increase in the amount of wheat supplied to market. ADDIN EN.CITE <EndNote><Cite AuthorYear=”1″><Author>Abay</Author><Year>2010</Year><RecNum>13</RecNum><DisplayText>Alemnew Abay (2010)</DisplayText><record><rec-number>13</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>13</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Abay, Alemnew</author></authors></contributors><titles><title>Market chain analysis of red pepper: the case of Bure woreda, west Gojjam zone, Amhara National Regional State, Ethiopia</title></titles><dates><year>2010</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>Alemnew Abay (2010) also indicated that a unit increase in land allocated for ginger, would give rise to 11.1qt increase in the amount of ginger supplied to market. So both author agreed land allocated for product is positive significantly affect supplied to market.

Education level of HHH: Education has showed positive effect on wheat quantity sold with significance level at 10%. On average, if wheat producer gets educated, the amount of wheat supplied to the market increases by 4.07 quintal. The result further indicated that, education has improved the producing household ability to acquire new idea in relation to market information and improved production, which in turn enhanced productivity and there by increased marketable supply of wheat. This is in line with ADDIN EN.CITE <EndNote><Cite><Author>Takele</Author><Year>2010</Year><RecNum>14</RecNum><DisplayText>(Astewel Takele, 2010)</DisplayText><record><rec-number>14</rec-number><foreign-keys><key app=”EN” db-id=”appxrxaw9zr293ex5voxpft3asxs25x055tw”>14</key></foreign-keys><ref-type name=”Thesis”>32</ref-type><contributors><authors><author>Takele, Astewel</author></authors></contributors><titles><title>Analysis of rice profitability and marketing chain: The case of Fogera Woreda, South Gondar Zone, Amhara national regional state, Ethiopia</title></titles><dates><year>2010</year></dates><publisher>Haramaya University</publisher><urls></urls></record></Cite></EndNote>(Astewel Takele, 2010) who illustrate if paddy producer gets educated, the amount of paddy supplied to the market increases, which suggests that education improves level of sales that affects the marketable surplus.

5. CONCLUSION AND RECOMMENDATION5.1 Summary and ConclusionThe study was conducted in Debre Elias special woreda located about 341 km in Northwest of Addis Ababa. The area is known for its surplus production of agricultural commodities. The study attempted to investigate marketing chain of wheat in the area. Selection of the wheat was mainly based on their relative dominate product and marketability.

The study was conducted in order to identify production and marketing support services, structure-conduct-performance of the market, profitability of producer and traders and determinants of wheat supply in the area.

Production of wheat in the study area is mainly for market. Hence, the commodities are important source of cash for smallholder farmers’. Nationally, the area is known for its surplus of wheat production. In the area, the average land allocated for the production of wheat per household was 1.127 hectares. The respective average production of wheat per hectare was 33.37 quintals.

Inputs used by farmers of the study area are fertilizer, seed and herbicides these inputs are supplied to farmers either by cooperative/unions and private traders. The survey result indicated that all sample respondents applied DAP (Di Ammonium Sulphate) and all of them used UREA fertilizer on their wheat field. The rate of application was 116.72 and 134.25 kg’s on average for DAP and UREA respectively. The survey result indicated that all sample respondents applied herbicides. The rate of application seed was 129.29 kg’s per hectare.
The estimated farmers average production cost per hectare was Birr 8991.249 (266.57 ETB per quintal) for wheat. The total revenue obtained from the production of wheat per hectare was simply estimating the sum of average revenue from wheat and average revenue from wheat straw a farmer received in the production year. The total revenue a sample farmer owned from hectare of land from production of wheat was Birr 12451.9. Subtracting the average production costs (8991.249 ETB) from the value of total revenue it would reach positive net revenue of Birr 3460.651 (102.6 ETB per quintal) for wheat per hectare. With respect to the profitability of trader, the overall average profitability of wheat across the different markets indicates that at every stage of transaction, trading business was profitable. However, processers were traders who obtained the highest net profit per quintal than that was 66 ETB. Farmer traders obtained least net profit per quintal that is16.19 ETB.

Out of the 5853 quintals of total wheat production in Debre Elias woreda total surplus of wheat which would follow to market through all channels were estimated to be 2557 quintals. Hence, wheat market channels were constructed based on the data collected from the whole wheat chain actors 17 lines of market channels were identified. Three of these went outside the region and the rest 14 was inside. The study also identified the main marketing agents through whom wheat were channeled from producer to final consumers, such as wholesalers, Urban assemblers, Processors, Farmer traders, Cooperative, Regional retailers and consumer with an estimated percentage share of 42.2, 35.3, 6.9, 6, 5, 3.6 and 1 percent in that order.
Regarding structure of the market, the four firm’s concentration ratio (CR4), that is the share of the largest four wholesale traders in the total volume of wheat purchased at Debre Elias woreda market, hold 70.25% of the total volume of wheat purchased in the year 20017/18 indicating that Debre Elias regional market has strong oligopolistic market structure.

Barrier to entry in terms of licensing and years of trade experience did not hinder entry into wheat market, but capital requirement did. Market information system is not transparent among farmers and traders. However, all traders have information from different informal sources.

Concerning conduct of wheat market, generally, trading is mainly on eye-appraisal and exchange takes place on bargaining. Traders are highly mobile and purchased from different market per week. The average number of market visited per week by all traders was 3.77. The frequency of market visit by processers (7 days) was the highest of all traders followed by wholesalers (5.56).

Multiple regression models was run to identify factors determining volume of wheat marketed. The result of the multiple regression models indicates that among 12 variables, six variables had shown significant relationship with volume of wheat marketed in the study area. Accordingly, Access to market information, Lag Price, Extension Contact, access to credit service, quantity produced of wheat and size of land allocated for wheat production were found to influence volume of wheat marketed positively and significantly.
5.2 RecommendationsThe wider range difference among farmers in rate of fertilizer application and seeding rate per hectare and its deviation from recommended rate was found partly due to poor extension services farmers to apply fertilizer according to recommendation. Therefore, provision of extension service has to be strengthened so as to improve farmers’ access to information and extension advices through giving training and other related supports. Moreover, improving access to credit and reconsidering the existing bureaucratic input administration procedure are also crucial to allow easy access to promote investment and trade. Furthermore, revisiting the previous research recommendations is highly important.

The enhancement of wheat producers’ bargaining power through cooperatives is the best measure that should target at reducing the oligopolistic market structure in the Debre Elias regional market. The measure also favors the sustainable supply of wheat at reasonable price to consumers.

The results of econometric analysis indicated that volume of wheat marketed is positively and significantly affected by utilization of credit. Thus, viable credit market could be strengthened to encourage the producers to use more of the rightful inputs and to facilitate their market access activities. There is a need for policy and institutional arrangements to strengthen already established cooperatives and increasing number and availability of other credit services providers beside the cooperatives to improve access and availability of modern means of production and marketing.

Wheat land size allocation is also positively and significantly affected volume of wheat marketed. Land is one of the most important and scare resource on agricultural production. Therefore, better farm land management practices, use of recommended fertilizers and crop rotation etc should be given more concern for further improvement of land fertility thereby increase the production and productivity of wheat in order to increase volume of wheat marketed. In addition to that, continuous training and follow up should be provided on factors that further increase productivity of land by the responsible stakeholders so that producers will be more experienced.

Wheat lagged price is positively and significantly affected on volume of wheat marketed. Previous wheat market price has impact on the volume of wheat marketed in this year. Therefore, prices determine bodies should be considered effect of lagged price on volume of supply.

Quantity of wheat produced is one of the determinant factors that affect volume of wheat supplied to the market positively. Therefore, policy proposed should focus on increasing production and productivity of the sector. This could be partly achieved through identifying new technologies and management systems that would improve the production and productivity of the crops. Creating stable demand for surplus production would also enhance farmers’ decision on wheat production consistently.

The result of this study has shown that access to market information affected the quantity of wheat supplied positively and significantly. Farmers in the study area do not get timely market information up on which to base their marketing decision. They depend on traders and other farmer friends for price information. Therefore, there has to be an institution that can convey reliable and timely market information required by all stakeholders simultaneously. This would make the marketing system to operate efficiently and harmoniously. The availability of timely and precise market information increases producers’ bargaining capacity to negotiate with buyers of their produce.

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APPENDIXES
Appendix Table SEQ Equation * ARABIC 1. Conversion factors used to compute tropical livestock units
Animal Category Tropical Livestock Unit (TLU)
Ox 1.10
Cow 1.00
Heifer 0.50
Bull 0.60
Calves 0.20
Sheep 0.01
Goat 0.09
Donkey 0.50
Horse 0.80
Mule 0.70
Poultry 0.01
Source: Storck, et at. (1991)
Appendix Table SEQ Equation * ARABIC 2Asset ownership of farmer respondentsResource owned Mean Standard Deviation
Number of oxen 3.214286 1.699536
Number of cows 2.623377 1.273552
Number of heifer 1.688312 1.09377
Number of calves 1.5 1.133276
Number of sheep 2.555556 2.719058
Number of goats .1883117 1.322354
Number of Donkey .9285714 .7330404
Number of mule and horse .0519481 .2226462
Number of poultry 2.909091 4.099041
Number of Bee colony .8181818 1.798527
Source: Own survey (2017)
Appendix Table SEQ Equation * ARABIC 3. VIF for Multi collinearity testVariable VIF 1/VIF
AMOUNT_PRD~D 1.72 0.581095
LANDSZE_WH~T 1.35 0.739052
PRICOHER 1.33 0.753729
DESTMAMRCT 1.28 0.782145
EXTEN_SERV 1.27 0.789388
SEXOFHH 1.22 0.820095
TAKCRDT 1.16 0.865218
MRKINFO 1.15 0.865906
OXN_OX 1.14 0.875299
TOTFAMSZ 1.13 0.886947
EDUCSTA 1.12 0.888923
AGEOFHH 1.07 0.934284
Mean VIF 1.25 Source: Own survey (2017)
Appendix Table SEQ Equation * ARABIC 4. Endogeneity testInstrumented: AMOUNT_PRDUCED
Instruments: PRICOHER AGEOFHH EDUCSTA TOTFAMSZ NO_OX LANDSZE_WHEAT TAKCRDT EXTEN_SERV DESTMAMRCT MRKINFO SEXOFHH
. estat endog, forcenonrobust Tests of endogeneity Ho: variables are exogenous
Durbin (score) chi2 (1) = 2.57275 (p = 0.1087)
Wu-Hausman F (1,142) = 2.41258 (p = 0.1226)
Appendix Table SEQ Equation * ARABIC 5. Specification test (ovtest)Ramsey RESET test using powers of the fitted values of QUANTITY_SUPPLIED
Ho: model has no omitted variables
F (3, 138) = 2.08
Prob > F = 0.105
Appendix Table SEQ Equation * ARABIC 6. Correlation coefficient of wheat variablesQUANTITY_S~D Sex HH Age of HH Education HH Total family Size Total Livestock Unit Land size of wheat quantity produced of wheat Lag Price Take Credit Extension Contact Distance to Nearest Market Market Information
QUANTITY_S~D 1.000 Sex HH -0.1164 1.0000 Age of HH 0.0677 -0.0979 1.0000 Education HH 0.0860 -0.2112 -0.0198 1.0000 Total family Size 0.1218 -0.0782 0.0479 -0.0236 1.0000 Total Livestock Unit 0.0780 0.1605 -0.0000 -0.0209 0.1005 1.0000 Land size of wheat 0.4326 -0.1832 0.0054 0.0616 0.1359 -0.0069 1.0000 quantity produced of wheat 0.5253 -0.2174 0.2089 -0.0619 0.1324 0.1935
0.3628
1.0000 Lag Price 0.4319 -0.1006 0.0676 0.0088 0.1989 -0.0423
0.2994
0.4052 1.0000 Take Credit 0.1493 0.0031 -0.0340 -0.1260 -0.0423 -0.0641
0.2075
0.0373 -0.0244 1.0000 Extension Contact 0.0590 0.1298 0.0445 -0.1599 -0.0285 0.1272
-0.1600
0.1275 -0.0361 -0.2350 1.0000 Distance to Market -0.1508 0.0346 0.0740 -0.0991 0.1532 0.0879
-0.2374 -0.1081 -0.1630 -0.0754 0.2780 1.0000 Market Information 0.2659 0.0508 0.0125 -0.0002 0.0982 0.1212
0.0897
0.2517 0.0241 0.0672 0.0415 0.1644 1.0000
Source: Own survey (2017)
Appendix Table SEQ Equation * ARABIC 7 research questioners
Market Chain Analysis of Wheat in the case of Debre Elias Woreda, Northwest Ethiopia
Questionnaire for wheat producers
Instructions to enumerators
Make brief introduction before starting any question, introduce yourself to the farmers, greet them in local ways and make clear the objective of the study.

Please fill the interview schedule according to the farmers reply (do not put your own feeling).

Please ask each question clearly and patiently until the farmer gets your points.

Please do not use technical terms and do not forget local units.

During the process write answers on the space provided.
Prove that all the questions are asked and the interview schedule format is properly completed
Kebele of the respondent Name of enumerator Date of interview Signature Household characteristics
Name of household head _________________________
Sex of household head: 1. Male 2. Female
Age of household head: _______ years
Religion of household head: 1. Orthodox 2. Muslim 3. Protestant 4. Catholic 5. Other (specify) ______________
Marital status of household head: 1. Married 2.Single 3. Divorced 4. Widowed
Educational level of household head: 1. Illiterate 2. Informally literate (read & write) 3. Formally literate
If your answer is formally literate, mention years of schooling _________
What is the total family size in your household including you? _________
Would you tell me the number of your family members including you by sex, age groups, & educational level as of the table below?
Age groups (years) Educational levels
Sex < 15 15-64 > 64 Illiterate Read&write1-4 grades 5-8 grades 9-10 grades Certificate & above
Male Female Resource ownership and household income
Landholding: Cultivated land by ownership (own, shared-in and rented-in) and crops grown in 2017/18
Land category Area planted Crops grown
Hectare Code 1
Own land Shared-in Rented-in Did you lease-out (rented-out or shared-out) your own land to others? 1. Yes 2.No
If yes, what is the area of land leased-out _______ ha,
If rented-out, how much was the rent (in birr) ________
If shared-out, how much was your share from total yield produced (in %) ________
Livestock assets and income from sale of live animals in 2016/17
Types of livestock Number of animals owned Number of animals sold Income from livestock
sold (Birr)
Oxen Cows Heifers Calves Bulls Sheep Goats Donkeys Mules/horses Poultry Bee colonies (hives) Other (specify ) Income from sale of livestock products
Livestock products Income from sell (birr)
Dairy products (milk, butter, yoghurt,…) Meat Eggs Honey Hides and skins Renting draft animals Manures (dung cake) Crop production and input use
Crop production and utilization during 2017/18
Crops grown Area Production Quantity consumed Quantity sold Price
Ha Qt Qt qt Birr/qt
Wheat TeffNugiMaize Barley Sorghum Chick pea Others(specify) What is your experience in wheat production? _________ years
What was the trend of wheat production for the last five years?
1. Increasing 2. Decreasing 3. Consta18. What are the reasons for such past trend happened in Q.17 above?
19. What will be your plan of wheat production in the future?
1. To increase 2. To decrease 3. Remain constant
20. Why do you plan such future trend of production in Q.19 above?
21. Types, amounts and sources of inputs used for wheat production in 2017/18?
21.1 Seeds used for wheat production
Seed type Did you use
this seed?
1.Yes 2.No Amount
used Value
Means of buying
1.Cash 2.Credit Name of variety of this seed Source
of seed Problems on supply of this seed
Code Kg Birr Code Code 1 Code 2
Local seed Improved seed Code 1: Source of seed Code 2: Problems on seed supply
Farmers 1. Inadequately supplied
Cooperatives/unions 2. Untimely/late delivery
Agricultural offices 3. Low quality
Research institutes 4. High price
Ethiopian/Amhara seed enterprise 5. Unknown origin
Traders/market 6. Others (specify)___________
Others(specify) __________
21.2 Fertilizers used for wheat production
Fertilizer type Did you use
this fertilizer?
1.Yes 2.No Amount
used Value
Means of buying
1.Cash 2.Credit Source of fertilizer
Code kg Birr Code Code 1 above
UREA DAP Compost Manure 21.3 Agro-chemicals used in wheat crop protection
Agro-chemicals Did you use
this chemical?
1.Yes 2.No Amount
used Value
Means of buying
1.Cash 2.Credit Source of chemical
Code Liter Birr Code Code 1 above
Insecticides Herbicides Pesticides 21.4 Labor, animal power & other input costs (in birr) of wheat production across farming operations
Tillage Sowing Weeding Harvesting Threshing Transportation Marketing
Labor costs Animal power costs (draft/pack) Other input costs
Storage practices on wheat yield
22. Did you store wheat in 2007/08 E.C.? 1. Yes 2.No
23. If yes, for how long did you store it? months24. How did you store the wheat?
1. Filling in sack & placing in ‘kot’ 2. In granary/’gotera’ 3. Others (specify)
25. What was your motive to store?
1. Expecting high price 2. Saving purpose 3. Lack of market demand 4. Others (specify)
26. If your motive was better price, did you sell as of the price what you expected? 1. Yes 2. No
27. What problem did happen on stored wheat?
1. Quality reduced
2. Quantity reduced
3. Both quality & quantity reduced
4. Neither quality nor quantity affected
28. If quality/quantity of stored wheat reduced, what was/were the reason(s)?
1. Disease/pest damage 2.Rodents 3. Treating with chemical (fumigation) 4. Sprouting 5.Rottening 6. Others (specify) __________
29. Packaging practices for distribution/sell of wheat yields
30. What was the packaging material that you used while selling/distributing wheat to buyers? 1. Akimada 2. Plastic sack (Madaberya) 3. Sisal sack ‘jonia’ 4. Others (specify) ______
31. What is the estimated weight of wheat packed per packing material stated in Q.29 above? ________ kg32. Did you face a problem on your packaging material? 1.Yes 2.No
33. If yes, mention the problem(s) ______________, ______________, ______________
Access to institutional services/supports
34. Distance of your home from Agricultural (DAs)Office ________ walking distance (minutes)
35. Did you get extension service related to wheat enterprise last year? 1. Yes 2. No
36. If yes for Q 35, would you tell us about the extension service(s) that you got related to wheat enterprise last year as of the table below?

Extension services Did you get this service? 1.Yes 2.No How often did you get the service per year? Adequacy of the service
1.Sufficient
2.Insufficient If insufficient, why?
Code Code 1 Code Wheat production Harvesting/postharvest handling of wheat Marketing of wheat Accessing market information Linking with potential markets/ buyers Others __________ Code 1: Frequency of extension contact/service per year
1. Weekly 2. Biweekly 3. Monthly 4. Quarterly 5. Biannually 6. Once a year 7. Any time you asked them
Access to credit services
37. Did you need credit last year? 1. Yes 2. No
38 If no for Q.37, why?
Don’t have shortage of money
Culturally inhibited to take credit
High interest rate
The source is very far from home
Others ________________
39. If yes for Q.37, did you take credit last year? 1. Yes 2. No
40. If yes for Q.39, would you tell us about the credit service as of the following table?
Sources of credit Did you take credit from this source?
1.Yes 2.No If yes, in what form?
1.Cash 2.Kind If in cash If in kind, what type? Terms of credit
1.Short term
2.Long term Interest rate
How much Purpose of credit Code Code Birr Code 1 Code 2 Code %
Banks Microfinance (ACSI) Coops/unions Relatives/friends Traders/local lenders Iquib/IdirOthers __________ Code 1: Purpose of on-cash credit
1. Buying fertilizer for wheat
2. Buying improved seed for wheat
3. Renting land for wheat expansion
4. Paying tax
5. Buying animals
6. Buying food grains
7. Other (specify) ______
Code 2: Types of in-kind credit
1. Fertilizer for wheat
2. Improved seed for wheat
3. Dairy cows
4. Oxen
5. Fattening animals
6. Farm implements
7. Other (specify)
Access to market, market information and market infrastructure
41. Distance of your home to the nearest “all weather road” _______ walking time (minutes)
42. Did you participate in wheat marketing last year? 1. Yes 2. No
43. Did you sell wheat to the market last year? 1. Yes 2. No
44. If yes for Q.43, would you tell us information about selling of wheat as of the table below?
Seasons of selling wheat Did you sell wheat during this season?
1.Yes 2.No Quantity of
wheat sold Price Selling frequency
per season
Code Qt birr/qt Number
Harvesting season Off-season 45. How far is the wheat local market from your home?_____ minutes of walking
46. How far is the nearest main market from your home?______ minutes of walking
47. On average how long did it take you to sale your wheat (duration of marketing time since you reached market place till you sold your product)? ________ hours
48. To whom (market agent) did you sell your wheat last year at what price and how much?
Buyers of wheat Did you sell wheat
to this buyer
1.Yes 2.No How did you sell to this buyer?
1.Directly
2.Via broker
3.Via commission man Quantity
sold Price Terms of sell
1.Cash 2.Credit
3.Advance payment Place to sell
1.Farm gate
2.Local market
3.Town market What makes to sell this buyer
1.Better price
2.Fair scaling
3.Nearness
4.Others
Code Code Qt birr/qt Code Code Code
Consumers Retailers Wholesalers Local assemblers Coops/unions Traders Gov’t institutions 49. Did you face difficulty in finding buyers when you wanted to sell wheat? 1. Yes 2. No
50. If yes for Q.49, what was the difficulty: 1. Inaccessibility of market 2. Low price offer 3. Lack of market information 4. Others (specify)______________
51. What did you do when the wheat you offered to the market was not sold?
1. Took back home for own consumption
2. Took back home & sold in another market day
3. Sold at lower price
4. Stored and sold on other market day (off-season)
52. Who set your selling price for wheat lst year? 1. Yourself 2. Buyers 3. Set by market (demand and supply) 4. Negotiation 5. Other (specify) ______________
53. If you decided on the selling price, how did you set the price? 1. Individually 2. Collude with other farmers 3. With your household members 4.Other (specify)__________
54. When did you get the money after sale? 1. Soon you sold 2. After some hours 3. Other day after sale 4. Other (specify)___________
55. How did you transport your produce from home to market? 1. Human loading 2. Vehicle 3. Pack animals 4. Other (specify)__________
56. How did you get market information on supply, demand, & price of wheat?
Information on Source of information
1.Coop/union 2.Other farmers 3.Broker  4.TV 5.Radio 6.Telephone 7.Personal observation 8.News paper 9. Other____
Code
Supply Demand Price Main actors and stakeholders along market chain of wheat
56. What are the main actors and stakeholders along the market chain of wheat and their roles for chain development?
Market chains Main actors Stakeholders
Names Roles Names Roles
Input suppliers Producers Assemblers Wholesalers Retailers Consumers 56. What are the constraints of main actors and stakeholders along the market chain of wheat?
Market chains Constraints of main actors Constraints of key stakeholders
Input suppliers Producers Assemblers Wholesalers Retailers Consumers 58. What are the opportunities of main actors and stakeholders along the market chain of wheat?
Market chains Opportunities of main actors Opportunities of key stakeholders
Input suppliers Producers Assemblers Wholesalers Retailers Consumers Thank you very much for responding to the questions.

Title: Market Chain Analysis of Wheat the case of Debre Elias Woreda, North Western Ethiopia
By Mezgebu Aynalem
Traders’ questionnaire
General Information
Name of trader_____________
Name of market–––––––––
Age of trader _____year
Sex of trader 1. Male 2. Female
Religion of trader 1. Muslim 2. Orthodox Christian 3. Protestant 4. Catholic 5.other (specify)________
Marital status of trader 1. Single 2. Married 3. Divorced 4. Widowed
Family size. Male __________ Female ___________ Total _____________
Educational level of trader 1. Illiterate 2. Read and write 3.Religious schools 4. _____years of formal education 5. Other (specify)
Type of trade: 1. Retailer 2. Wholesaler 3. Collector 4. assemblers 5. Others————–
How did you start wheat trading? __________________________________ ?
Distance from residence to the market _______ Km/walking time in minutes
For how long have you been in this business? _________years
What is your main business? Put in order of importance and business proportion
Business activity Rank position
Whole seller Collector Assembler Brokers Retailers Total number of persons employed in your business in 2017/2018?
Employee Permanent Temporary
M F M F
Family members Non family members Total Do you participate in wheat trading year round? 1. Yes 2. No
If your answer to Q.15 is No, at what period of the year do you participate? 1. When purchase price becomes low 2. During high supply 3. Other(specify) _________
Do you practice trading other than wheat? 1. Yes 2. No
If your answer to Q.17 is yes, what? ————————————
Number of market days in a week? __________________
What was the amount of your initial working capital when you start wheat trade business? ——Birr.

What is the amount of your current working capital? ———– Birr.

What is your source of working capital? 1. Own 2.Loan 3. Gift 4. Share 5. Others (specify) _________
If it was loan, from whom did you borrow? 1. Relative/family 2. Private money lenders. 3. NGO (specify) 4. Friend 5. Other traders 6. Micro finance institution 7. Bank 8. Others (specify) _________
How much was the rate of interest? _____ birr for formal, ————–birr for informal.

What was the reason behind the loan? 1. To extend wheat trading 2. To purchase wheat transporting vehicles/animals. 3. Others (specify) _________
How was the repayment schedule? 1. Monthly 2. Quarterly 3. Semiannually
4. When you get money 5. Others (specify) _________
27. Is there change in accessing finance for wheat trade these days?
1. Improved 2. Deteriorated 3. No change
28. What mode of transportation did you use?
1. Man power 2. Animal back 3. Vehicle 4.cart 5. Others (specify) ) _________
29. How did you attract your suppliers? 1. By giving better price relate to others 2. By fair scaling weighing 3. By visiting them 4. Other (specify) ) _________
30. How did you attract you buyers? 1. By giving better price relate to others 2 Quality of your product 3 by fair scaling 4 by visiting them 5. by giving credit 6. Other (specify)
31. Assets owned in 2016/7
Asset No Total value
Store
Residence Separate house Mobile Telephone Weighting scale Shop Bicycle Motor cycle Vehicle Others(specify) If no fixed capital please put”0″
Purchase practice
32. From which market and supplier did you buy groundnut in 2006/7?
urchased from Market, (use code)» Purchased from
sellers,(use code) R/ship
(use code)
%age
share of seller Average
quantity purchased per market
in a week
(qt) How many  weeks did you operate in this market in 2007/8 Average
Price per quintal Term of
payment
1=cash
2= credit
3=advance
payment
»
Where:
1.Village market
2.Guay market
3. Gofichema market
4.D/Elias market
5.D/Markos market
6. Genet market
7. B/dar market

From sellers:
Farmers
Retailers Urban)
Retailers Rural)
wholesalers Urban)
wholesalers Rural)
farmer trader village)
Collector)
urban assembler)
you don’t know Relationship:
1.The same religion
2. The same ethnic
3.The same origin
4. Close relative
5.Exclusive relation
6. Meet socially
7. If other (specify)
32. From which market (s) did you prefer to buy most of the time in 2017/8? Use from the above table.
33. Why did you prefer this market (s)?
1. Better quality 2. High supply 3 .Shortest distances 4. If other (specify) ———
34. How did you set the purchase price in 2007/08?
1. Set at the time in advance is given 3. It is the market price at the time of delivery
2. Negotiated at delivery 4. If other (specify) ———
35. Have you ever experienced problems from buying agents? 1. Yes 2. No
36. If yes, what types of problem?——————————————————————————-37. How did you solve it?—————————————————————————-Who bears the responsibilities in the case of losses ( e.g. theft, fire etc) of wheat while still in the possession of your buying agents? 1. The agent 2. I forgive him 3.we share the responsibilities 4. If other (specify)…………………………….

What problem(s) has/ have you been facing in your wheat business? 1. Low profit 2. Inadequate fund 3. High transport charges 4. If others(specify)—————————-
Who purchased wheat for you in 2007/8? 1)Itself 2. Family members 3. Friends 4. Through brokers 5. Commission agent 6. If others (specify)————–
If others purchased for you, how you did pay them?
1 ————Birr/quintal 3. —– % on purchase price
2. Above the price you decide 4. If others (specify)———If you used broker, what were problems created by them in 2017/8?
1. took your sellers & buyers to other traders 4 .cheating quality
2 .cheating scaling weighing) 5 .wrong price information
3 .charged high brokerage 6 .If other (specify) ——-
If you used commission men, what were problems created by commission men in 2017/8?
1. Didn’t buy enough quantity 3. Cheating on price 5 .Cheating on quality
2. Cheating scaling (weighing) 4 .charged high commission 6.If other (specify) ——–
What was the advantage of using brokers in 2017/8?
1 .You could get buyer and sellers easily 4 .Brought many buyers and sellers
2 .Reduce transaction costs 5. Purchased at low price
3 .Save your time 6.If others (specify)———–What was the advantage of commission men in 2017/8?
1 .You could get enough quantity 4 .charge low commission 7.If others (specify)———–
2 .Save your time 5. purchased at low price 3.You could get quality g/nut 6. reduce transaction cost On average, how many markets did you visit in a week in 2017/8? ————–Markets
At what time of a day was it preferable to purchase wheat in terms of quantity?
1 .Before 12 am 3 . 2-4 pm 5 .any time
2. 12-2 pm 4 . 4-6pm 6. If other (specify)———At what time of a day was it preferable to purchase wheat in terms of price?
1. Before 12 am 3 . 2-4 pm 5. any time
2 .12-2 pm 4 . 4-6pm 6 .If other (specify)———
Was the price of wheat the same on the same day in a marketing center in 2017/8?
Yes 2. No
Is your usual purchasing price higher than your competitors? 1. Yes 2. No
If yes in Q. 40 what was the reason?
1 .To attract more supplier 2. To kick out your competitor from the market
3. To buy more quantity 4 . To get better quality groundnut 5.If others (specify)——-How did you measure your purchase?
1 .By sack 2 .By basket 3. By weighing kg) 4. By ‘quintal’ 5 .If others (specify)—–What was your packaging material?
Sisal sack ‘jonia’ 2 Plastic sack ‘Madaberya’ 4. Basket 5. If others (specify)———Who set your purchasing price in 2007/8?
1 .Yourself 2 .The seller 3 .negotiation between me and the seller
4 .by market demand ; supply force 5 . Other traders from B/dar 6.If other (specify)
If you decided on the purchasing price, how did you set the price?
1. Individually 2. Collude consultation with other traders 3. If others (specify)—When did you set purchasing price? 1 .Early in the morning of the market day
2. At midday of the market day 4 .At the evening of the market day
3. .At the time of purchase 5 .One day before the market day
6. After you sell the produce in other market 7. If others (specify)————–Selling practices
To which market and for whom did you sell in2007/8 E.C?
Where Market did
you sale, (use code)
To whom buyers did you sell (use code) R/ship (use code)
%age
share of buyers Average
quantity sold per week in this market How many
weeks did you operate in
this market average
price/qt Terms of
sell
1=cash
2=credit
3=advance receive
»
Where:
1.Village market
2.Guay market
3. Gofichema market
4.D/Elias market
5.D/Markos market
6. Genet market
7. B/dar market
8. Addis Abeba

From sellers:
Farmers
Retailers (Urban)
Retailers (Rural)
wholesalers (Urban)
wholesalers Rural)
farmer trader village)
Rural Collector
urban assembler
you don’t know Relationship:
1.The same religion
2. The same ethnic
3.The same origin
4. Close relative
5.Exclusive relation
6. Meet socially
7. Anybody
8. If other (specify)
Did you have other branch shops/sheds to sell your wheat? 1. Yes 2. No
Who decided on your selling price 2017/8?
1. Itself 3 .Purchaser 5 .negotiation between me & the purchaser
2 .By the market demand & supply force other traders 6. Other (specify)———-
If you decided on the selling price, how did you set the price?
1 Individually 2 consult with other traders 3.If others (specify)———-When did you set selling price?
1. Early in the morning of the market day 4, One day before the market day
2. At midday of the market day 5. At the evening of the market day
3 .At the time of selling 6 .If others (specify)—————–Who sold wheat for you in 2017/8?
1. Myself 2. Through broker 3. Family 4.commsion men 5.If other (specify)—–If others sold for you how did you pay them?
1. ——birr/quintal 3.————-% on sales price
2. Above the price you decide 4. If other (specify)———Did you give bonus per quintal at the time of your sales? 1. Yes 2. No
If yes, how many kg per quintal—————–Kg?
Did you have a brochure/ notice board for customers that describe your firm’s capabilities? 1.Yes 2.No
How many sellers were there in this market in 2017/8————sellers?
How many times you visit for search information per a week———————?
How many buyers for you in this market in 2007/8? —————buyers?
What was the major problem to enter into wheat trade?
1. License 2. Lack of capital 3 .government policy 4. Other (specify)———-Are there restrictions imposed on unlicensed wheat traders? 1. Yes 2. No
Did you pay tax for the groundnut you purchase in 2007/8? 1. Yes 2.No
Did you pay tax for the wheat you sell? 1. Yes 2. No
What was the basis of tax?
1. Per sack——-Birr 3 .per basket——-Birr 5 .Per kg—–Birr
2. Per quintal——-Birr 4. Fixed payment——-Birr . If other (specify)——-
What is your opinion regarding the marketing fee paid in this market as compared to your transactions?
1. Low 2. High 3. Average 4. I don’t knowIs wheat trading in your locality needs a trading license?
1. Yes 2. No 3. Not mandatory
If yes, how do you see the procedure to get the license? 1. Complicated 2. Easy
Did you have wheat trade license? 1. Yes 2. No
How much did you pay for wheat trade license _______ Birr?
How much is the renewal payment _______ Birr?
Did you store wheat before you sold in 2007/8? 1. Yes 2. No
If yes, for how long did you store maximum————– days?
Indicate your average cost incurred per quintal in the trading process in 2007/8?
Marketing cost
components in the chain Source (use code) Source (use code) Source (use code)
Birr/qt Birr/qt Birr/qt
Purchased price of
groundnut per quintal
Packaging / holding material Labor employed to fill
the bag/jonia and sew Load of the product Unload of the product Brokerage/commission fee Transportation for Vehicle Transportation for Cart/ pooling cart Head/back load for daily labour Sorting License fee Taxes and fee Wage for permanent employee Guard/s Storage cost Storage loss Water Electricity Weighing Telephone expense Information cost Personal travel & other expenses Others (specify) Total costs Selling price of quality wheat per quintal
per quintal Revenue
Purchased from:
1.Farmers / urban assembler 3. Retailers Rural) 5. wholesalers Rural)
2. Retailers Urban) 4 .wholesalers Urban) 6. farmer trader (village collector )
7 Other (specify)———–
Information and Transportation
How did you get information on supply, demand & price of wheat in other markets?
Use code Source of information multiple answer is possible)
Supply 1. Other groundnut traders 4. personal observation
2. Radio 3. News paper 5 .Broker 6. TV
4. Telephone 7.If others(specify)——-
Demand Price Are you willing to pay for market information in the future? 1.Yes 2.No
Was there transportation problem? 1. yes 2. No
If yes what was the problem?
1. No transportation service 2 .high tariff 3. It was seasonal 4.If others (specify)——-How this market road was looks like in rainy season for vehicle transport?
1. It was difficult 2. No problem
If it was difficult, for how long impassable for vehicle?—————-Months
How did you get vehicle transport to come to this market?
1. Daily 2 .Only market day 3. Contract 4.If others(specify)-
What mode of transportation did you use from collection point to store?
Head/back load 3. Pack animal 5 If others
2.Trucking/Vehicle 4.Cart 6. What mode of transportation did you use from store to market?
1. head/backload 2.trucking /vehicle 3.pack animal 4. Cart 5. If others (specify)—–Are there problems on groundnut marketing? If yes what are the problems, & your suggestions to overcome each problem?
No. Problem 1=Yes
2= No If yes what do you think about the causes of this problem? What are your suggestions (s)
to solve each problem?
1 Infrastructure: Road Telephone Electricity Water 2 Administrative measure
(multiple taxation and other fees) 3 Shortage of supply 4 Storage problem 5 Theft 6 Natural quality problem 7 Adulteration 8 Information flow 9 Capital shortage 10 Access to credit 11 Technical training 12 Business management (Financial
accounting training) 13 Absence of government support to improve groundnut marketing 14 Lack of demand (low price) 15 Too much competition with
licensed traders 16 Too much competition with
unlicensed traders 17 Farmers reluctance to sell
due to lower price 18 If others (please specify)
Thank you very much for responding to the questions.

Name of enumerator—————————- Signature: ———————- Date: ——–
Title: Market Chain Analysis of Wheat the case of Debre Elias Woreda, North Western Ethiopia
By Mezgebu AynalemChecklist for Key Informants and Focus Group Interview
1. Name of the organization: ______________________
2. Specific role in the organization: —————————————————–
3. Location and contact information: Region————-, Zone————, Woreda————-,
Kebele————–, P.O.Box————,Telephone———————–
4. Type of the organization: public————, private———-, NGO————–
5. Organizational mission———————–, vision ——————-and objectives ————
6. What is the role of your organization in wheat Market chain in the study area? —————
7. Linkage /interaction/ partnership/ coordination between actors ———————————-
8. How do you understand factors affecting farmers’ decision in wheat market chain in your locality? —————————————-
9. How do you understand factors affecting farmers’ level of participation in wheat market chain in your locality? —————————————-
10. How do you understand women’s role in wheat market chain in your locality? ————–
11. Among major actors in wheat market chain, who is benefiting more and who is benefiting the least according to your view? ——————————————
Thank you very much for responding to the questions.

Name of enumerator—————————- Signature: ———————- Date: ——–