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Profitability and Value Chain Assessment of Groundnut in Digga District of East Wollega Zone, Oromia National Regional State, Ethiopia

Received: Jul. 16, 2018    Accepted: Aug. 15, 2019    Published: Aug. 30, 2019
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Abstract

Marketing inefficiencies and low coordination of groundnut value chain are the main problems though Digga district is potential in groundnut production. The study was conducted to analyze the profitability and value chain assessment of groundnut in Digga district of Oromia region, Ethiopia. More specifically, the study identified value chain actors, their respective roles, maps the value chain, and assesses the performance of groundnut production in the area. Primary data were collected through a survey using pre-tested semi-structured questionnaire and through key informant interview using checklists and generated from randomly sampled 123 groundnut producers, 28 traders and 25 consumers. The major actors of groundnut value chain were: input suppliers, producers, traders, processors and consumers. Two-stage sampling procedure was employed to draw sample of groundnut producers. Digga districtwas selected purposively based on the potential it has for groundnut production in the zone. In the first stage, from kebeles which produce groundnut, 4 kebeles were randomly selected. In the second stage, 123 samples of household heads were randomly selected from total groundnut producers in the district and the sample households were drawn randomly from each kebele based on probability proportional to size sampling techniques. Producers’ highest gross marketing margin was 86.12% in channel III and highest total gross margin is 19.93% in channel IV while 13.88% is the lowest total gross margin in channel III. Cost incurred in groundnut production was 6588 Birr per Hectare and the gross income obtained from groundnut production was 9,600 Birr per Hectare and net income of the product was 3012 Birr per Hectare which shows groundnut production in Digga district is profitable. Opportunities and constraints of groundnut profitability and value chain were identified at each stage of value chain like input supply, production, processing, marketing and consumption of groundnut. The study recommended that farm machineries, improved seed of groundnut, market facilities and market outlets should be provided for farmers for insuring larger production and selling thereby to enhance profit of groundnut production in the study area.

DOI 10.11648/j.aff.20190804.11
Published in Agriculture, Forestry and Fisheries ( Volume 8, Issue 4, August 2019 )
Page(s) 81-88
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Groundnut, Profitability, Gross Margin, Digga

References
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[3] Addisu G, Erimias T. 2017. Value Chain Assessment Study of Groundnut in Northwestern Ethiopia. British Journal of Economics, Management and Trade, 16 (2): 1-15.
[4] Alemayehu C, Berhanu A, Mulugeta Taye, Abdi M, Tameru A, Helge, S. 2014. Opportunities and Constraints of Groundnut Production in Selected Drylands of Ethiopia. Drylands Coordination Group, 74.
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[6] Dawit A, Samuel, M. nd. Groundnut Production and Marketing Intervention to Empower the Value Chain. ICRISAT.
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[11] Geleta T, Purshotum, K. S., Wijnand, J. S, Tana T. 2007. Integrated management of Groundnut Root Rot Using Seed Quality and Treatment. International Journal of Pest Management, 53 (1): 53-57.
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[20] Taphee G. B, Jongur A. A. U, Dengle Y. G, Ephraim I. J. 2015. Analysis of Profitability of Groundnut Production in Northern Part of Taraba State, Nigeria. International Journal of Computer Application, 125 (1): 0975-8887.
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  • APA Style

    Oliyad Sori, Hika Wana. (2019). Profitability and Value Chain Assessment of Groundnut in Digga District of East Wollega Zone, Oromia National Regional State, Ethiopia. Agriculture, Forestry and Fisheries, 8(4), 81-88. https://doi.org/10.11648/j.aff.20190804.11

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    ACS Style

    Oliyad Sori; Hika Wana. Profitability and Value Chain Assessment of Groundnut in Digga District of East Wollega Zone, Oromia National Regional State, Ethiopia. Agric. For. Fish. 2019, 8(4), 81-88. doi: 10.11648/j.aff.20190804.11

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    AMA Style

    Oliyad Sori, Hika Wana. Profitability and Value Chain Assessment of Groundnut in Digga District of East Wollega Zone, Oromia National Regional State, Ethiopia. Agric For Fish. 2019;8(4):81-88. doi: 10.11648/j.aff.20190804.11

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  • @article{10.11648/j.aff.20190804.11,
      author = {Oliyad Sori and Hika Wana},
      title = {Profitability and Value Chain Assessment of Groundnut in Digga District of East Wollega Zone, Oromia National Regional State, Ethiopia},
      journal = {Agriculture, Forestry and Fisheries},
      volume = {8},
      number = {4},
      pages = {81-88},
      doi = {10.11648/j.aff.20190804.11},
      url = {https://doi.org/10.11648/j.aff.20190804.11},
      eprint = {https://download.sciencepg.com/pdf/10.11648.j.aff.20190804.11},
      abstract = {Marketing inefficiencies and low coordination of groundnut value chain are the main problems though Digga district is potential in groundnut production. The study was conducted to analyze the profitability and value chain assessment of groundnut in Digga district of Oromia region, Ethiopia. More specifically, the study identified value chain actors, their respective roles, maps the value chain, and assesses the performance of groundnut production in the area. Primary data were collected through a survey using pre-tested semi-structured questionnaire and through key informant interview using checklists and generated from randomly sampled 123 groundnut producers, 28 traders and 25 consumers. The major actors of groundnut value chain were: input suppliers, producers, traders, processors and consumers. Two-stage sampling procedure was employed to draw sample of groundnut producers. Digga districtwas selected purposively based on the potential it has for groundnut production in the zone. In the first stage, from kebeles which produce groundnut, 4 kebeles were randomly selected. In the second stage, 123 samples of household heads were randomly selected from total groundnut producers in the district and the sample households were drawn randomly from each kebele based on probability proportional to size sampling techniques. Producers’ highest gross marketing margin was 86.12% in channel III and highest total gross margin is 19.93% in channel IV while 13.88% is the lowest total gross margin in channel III. Cost incurred in groundnut production was 6588 Birr per Hectare and the gross income obtained from groundnut production was 9,600 Birr per Hectare and net income of the product was 3012 Birr per Hectare which shows groundnut production in Digga district is profitable. Opportunities and constraints of groundnut profitability and value chain were identified at each stage of value chain like input supply, production, processing, marketing and consumption of groundnut. The study recommended that farm machineries, improved seed of groundnut, market facilities and market outlets should be provided for farmers for insuring larger production and selling thereby to enhance profit of groundnut production in the study area.},
     year = {2019}
    }
    

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  • TY  - JOUR
    T1  - Profitability and Value Chain Assessment of Groundnut in Digga District of East Wollega Zone, Oromia National Regional State, Ethiopia
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    T2  - Agriculture, Forestry and Fisheries
    JF  - Agriculture, Forestry and Fisheries
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    EP  - 88
    PB  - Science Publishing Group
    SN  - 2328-5648
    UR  - https://doi.org/10.11648/j.aff.20190804.11
    AB  - Marketing inefficiencies and low coordination of groundnut value chain are the main problems though Digga district is potential in groundnut production. The study was conducted to analyze the profitability and value chain assessment of groundnut in Digga district of Oromia region, Ethiopia. More specifically, the study identified value chain actors, their respective roles, maps the value chain, and assesses the performance of groundnut production in the area. Primary data were collected through a survey using pre-tested semi-structured questionnaire and through key informant interview using checklists and generated from randomly sampled 123 groundnut producers, 28 traders and 25 consumers. The major actors of groundnut value chain were: input suppliers, producers, traders, processors and consumers. Two-stage sampling procedure was employed to draw sample of groundnut producers. Digga districtwas selected purposively based on the potential it has for groundnut production in the zone. In the first stage, from kebeles which produce groundnut, 4 kebeles were randomly selected. In the second stage, 123 samples of household heads were randomly selected from total groundnut producers in the district and the sample households were drawn randomly from each kebele based on probability proportional to size sampling techniques. Producers’ highest gross marketing margin was 86.12% in channel III and highest total gross margin is 19.93% in channel IV while 13.88% is the lowest total gross margin in channel III. Cost incurred in groundnut production was 6588 Birr per Hectare and the gross income obtained from groundnut production was 9,600 Birr per Hectare and net income of the product was 3012 Birr per Hectare which shows groundnut production in Digga district is profitable. Opportunities and constraints of groundnut profitability and value chain were identified at each stage of value chain like input supply, production, processing, marketing and consumption of groundnut. The study recommended that farm machineries, improved seed of groundnut, market facilities and market outlets should be provided for farmers for insuring larger production and selling thereby to enhance profit of groundnut production in the study area.
    VL  - 8
    IS  - 4
    ER  - 

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Author Information
  • Department of Agribusiness and Value Chain Management, Wollega University, Shambu, Ethiopia

  • Department of Agricultural Economics, Wollega University, Shambu, Ethiopia

  • Section