Factors affecting participation in mainstream cattle markets by small-scale cattle farmers in South Africa
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Date
2006-05
Authors
Montshwe, Bolokang Derrick
Journal Title
Journal ISSN
Volume Title
Publisher
University of the Free State
Abstract
Even though livestock farming has been identified in the Integrated Sustainable Rural Development Strategy as the agricultural sub-sector with the most likely chance of improving household food security and addressing poverty alleviation in the small-scale farming areas of South Africa, the reality is that the small-scale cattle sector has not achieved its full potential despite many efforts through research and development programmes. Previous studies have mainly identified factors impeding participation of small-scale farmers in both informal and mainstream markets and the extent or degree at which participation is affected. The purpose of this study was to investigate the probability of small-scale cattle farmers participating in mainstream markets and measure the impact of change of selected variable on the probability to participate. This is a departure from previous research in that the study attempts to identify those factors that have the greatest probability to increase participation in mainstream markets by smallscale farmers. The study was conducted in three different areas, namely Hammanskraal, Ganyesa and Sterkspruit. The sampling technique used in Hammanskraal is the stratified random sampling technique. In Ganyesa all the identified farmers were interviewed. Since the number of small-scale farmers was unknown in the Sterkspruit area the snowball sampling technique was used. The total sample size is 150 small-scale cattle farmers. A logit model is used in this study. Since multicollinearity in the data was identified principle component (PC) analysis was used to deal with this problem. After PC’s were calculated and PCs with the smallest eigenvalues were eliminated, principle component regressions (PCR) were fitted using the standardized variables to improve the estimation power of the logistic regression model. Partial effects of the significant continuous variables (i.e. herd size, desired market distance, household size, lobola, dependents, theft, household assistance and mortality) on the probability to use mainstream markets are relatively small. However, partial effects for the significant discrete variables (i.e. market information, remittances, training and farming systems) are more significant. The increase in the probability to participate in mainstream markets if the initial conditions are addressed range between 0.3 and 0.6. Simulations with regard to a base group of households revealed training and access to information will have the largest positive impact on the probability of small-scale cattle farmers to market their cattle through mainstream cattle markets if initial conditions improve. Although desired distance to markets, herd size and household size have the potential to increase off-take to mainstream markets, its potential impact is less that training and access to information. The impact of remittances and lobola on the small-scale cattle sub-sector, risk behaviour and the informal market are areas that need further research.
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Keywords
Dissertation (M.Sc.Agric. (Agricultural Economics))--University of the Free State, 2006, Cattle trade -- South Africa, Cattle -- South Africa -- Marketing, Cattle Marketing, Principle Component Analysis, Principle Component Regressions, Development, Small-scale cattle producers