Marketing Chain and Structure, Conduct and Performance of Sesame: The Case of Kafta Humera District, Western Zone of Tigray, Ethiopia

Abstract

This study analyzed marketing chain and structure, conduct and performance of sesame in Kafta Humera district of Tigray region, Ethiopia; using primary and secondary data obtained from field survey and desk review using a semi-structured questionnaire. Multistage random sampling technique was used to draw 128 and 126 small and, large-scale sesame producers, respectively. Also, a total of 44 assemblers, 5 cooperatives, 13 exporters and one processor were interviewed. Applying the descriptive statistics method and market observation of the researcher; the major sesame market chain actors were producers, assemblers, cooperatives, exporters and processors. The concentration ratios of the first four and eight large local assemblers and exporters indicated that there was a weak oligopoly market structure. It is also found that there were entry barriers, information asymmetry and collusion in price-setting; indicating that sesame market was deviating from the norms of competitive market structure. Considering free on board of hulled sesame price; the gross marketing margins of 5%, 12% and 45% and net marketing margins of 1%, 3% and 17% obtained by assemblers, exporters and processors, respectively. But, Considering the free-on-board price of raw sesame; the gross marketing margins of 7%, 18% and about 75% and net marketing margins of 1.13%, 4.41% and 4.85% obtained by assemblers, exporters and producers, respectively. All these indicating that the sesame market was being poorly performing. Depending on the results found this study recommends, it will be better if the focus is given to value-added product export, securing competitive market through minimizing entry barriers, strengthening timely updated market information and formal credit access, hiring marketing experts at market centres to control collusion of traders in price setting.