Value Chain and Market Participation of Maize in North Gondar Zone, Ethiopia

Abstract Background: The smallholder producers in Ethiopia generally and in North Gondar Zone specifically are price takers since they have little participation in the value chain and imperfection of the marketing system. Farmers have low bargaining power to sell their products to the market. Empirical findings on identifying actors of the value chains, and assessing determinants of farmers’ participation decision and marketed volume in the study areas in North Gondar is not found. As a result, this study examined the determinants of farmers’ participation decision and marketed volume in the study areas in North Gondar Administration Zone. Methods: Primary data was got from a total of 350 sample households and 60 maize traders who were interviewed using a pretested questionnaire. Heckman selection model was employed to identify factors that determine market participation decision and its intensity in maize markets.Results: The Heckman’s selection model result shows farming experience (P<0.079) and relative fertility of land (P<0.000) determines farmers’ maize market participation decision positively and significantly whereas rural credit access (P<0.002) affected it negatively. Variables DA visit frequency (P<0.03), distance from market (P<0.053) and Labor force (P<0.002) have positive effect and significant on marketed volume of maize. On the other hand, Farm land size (P< 0.040) and level of education (P < 0.041) are significant but they have a negative effect on it in North West Ethiopia. Conclusion: The area is a potential place to the production of maize. Even though the potential is high there are many determinants and challenges which affect the producer’s market participation status and the volume of marketed surplus. Therefore, government must check its land use proclamation and rural financial institution policies and their applications in North Gondar administration zone in Ethiopia.