Factors Affecting Milk Market Participation and Volume of Supply in Ethiopia

Abstract

The study was undertaken with the objective of assessing factors affecting milk market participation and volume of supply in Wolaita zone, Ethiopia. Out of the total 32,972 households, 398 households were selected using simple random sampling methods. Data were collected using discussions, rapid market appraisal, observation and formal survey. The data generated were analyzed using both descriptive and Heckman two-stage selection econometric models. The results revealed that out of an average 8 L of milk produced per day, 4 L were supplied to markets. The probit model results indicated that age of household head, dairy farming experience, milk yield per day, milking cow ownership and landholdings size played a significant role in milk market participation. Second-stage Heckman selection estimation pointed out that milk yield per day, dairy farming experiences and number of members in a household significantly affected volume of milk supply. Age of a household positively and significantly affected the probability of milk market participation. Dairy farming experiences of a household negatively and significantly affected milk market participation and volume of supply. The number of milking cows owned by a household positively and significantly affected probability of milk market participation. Milk yield per day impacted positively and significantly milk market participation and volume of supply. The policy implication is that old aged household heads should be educated through extension services to enhance milk market participation. Moreover, integration of crossbred cow, upgrading milk production potential of local cows, among others should be used to increase milk yield per day per household and hence milk market participation.