Factors influencing market access and livestock marketing inefficiency in Mpumalanga Province, South Africa

Abstract

Livestock production is the primary financial resource for most farmers in Mpumalanga province. Although commercial farmers require necessary equipment and technology to maximise their production and profit, but emerging small-scale farmers in the province face many challenges which have hindered their efforts to improve their livelihood, besides intervening in the procedure of commercialisation. Therefore, this study investigates the socioeconomic characteristics of the livestock farmers in the province, the determinants of market access and those influencing marketing inefficiency, with a view to developing policy recommendations. Structured questionnaire was administered to 300 farmers in order to capture information on market access and factors that could influence marketing inefficiency. Descriptive statistics was utilised regarding basic characteristics of the households. A logit regression model was used to analyse market access (sale of livestock through formal markets) using STATA. Marketing inefficiency was computed as the reciprocal of marketing efficiency which was calculated using Shepherd formula, while the two stage Least Square regression was applied for factors influencing marketing inefficiency after identifying market access endogenous variable. The study’s extrapolations indicated that 7 variables were consequential at 1% and 5% significance level with market access, namely transport ownership, transport cost, market price information, advertisement, farmers’ perception, marketing channel used and municipality. In addition, the results of the two stage least square model indicated that only 3 variables had remarkable significance with regard to marketing inefficiency. These are market access, livestock composition and infrastructure. The findings of the study evidenced that to reduce marketing inefficiency, then it is paramount to enable the easy dissemination of information and improving infrastructure so as to give small-scale farmers easy access to the markets. Consequently, addressing marketing constraints will provide an insight that will allow development of strategies to deal with those problems correctly and more efficiently. The study recommended that focus should be centred on addressing the constraints existing in livestock marketing system to enhance access to markets by encouraging youth participation in agricultural activities and providing training programmes and easy access for marketing related information. Also, infrastructure deserves to be given more attention by renovating the marketing facilities especially road networks in rural areas. In addition, extension officers and veterinary services are to provide help and support in preventing infections and diseases in order to minimise the losses.