Market Chain Analysis of Coffee in Sidama Zone, SNNPR, Ethiopia: The Case of Dale District

Abstract

The study analyzed the market chain of coffee in Dale district, a major coffee producing district in southern Ethiopia. The main coffee marketing channels were investigated and the determinants of household coffee supply identified. Data were generated from 123 coffee producers and 36 coffee traders in the district using a formal survey. Nine coffee marketing channels were identified and channel I and channel II, representing 49.3% and 25.7% of the total produce, respectively, were the principal coffee marketing channels. The coffee marketing performance revealed that in channel I and channel II 36.9% and 34.13% of total gross marketing margin were added to coffee price, respectively. Out of the total gross marketing margin, 9.6% was captured by coffee assemblers, while 27.3% went to wholesalers in channel I, while out of the total gross marketing margin in channel II 34.13% goes to the wholesalers. The OLS model identified that sex of the household head, education level, coffee productivity, extension contact, price of coffee, and access to market information were the significant variables influencing coffee marketable supply positively. Whereas, the variables distance to the nearest market and non-farm income negatively affected the coffee marketable supply.