ECONOMIC ANALYSIS ON THE MARKET PARTICIPATION DECISION OF THE RED ONION FARMERS IN JAFFNA DISTRICT, SRI LANKA.

Shylanthi Thangarajah

Abstract


Marketing plays a vital role in determining the profitability of the producers. Availability of market information and the right choice of a marketing channel is crucial in deciding the producer margins. Hence it is important  to identify the factors which have been influencing the farmers decision in choosing the marketing channels. Therefore this research has taken effort to identify the demographic and socioeconomic characteristics of the red onion farmers influencing the choice of marketing channel in Jaffna district, Sri Lanka. A purposive random sampling technique was used to select the samples from the population. Structured questionnaire was prepared and pretested prior to the data collection. Total sample size was 200, which is representing the 10 percentage of the total commercial red onion producers in the district. The compiled data were analyzed within the frame work of multinomial logit regression model by using the econometric software STATA version 10. The results revealed that the investment in future season and knowing the market price are found to be significant increase the log ratio of participation in the wholesale market through middleman based on the participation in the direct retailing market by 3.148, 3.532 respectively. The investment in last year and membership in a producer group manifested a significant negative impact and decrease the log ratio of choice of performing direct transporting based on the participation in the direct retailing by 19.438, 1.985 respectively. The investment in last year manifested a significant negative impact and decreases the log ratio of choice of participation in the wholesale market through middleman based on the participation in the direct retailing by 14.058. From this the research concludes that the availability of market information vastly deciding the choice of the marketing channels. Hence it is important to both government and non government sectors to take effort in disseminating the market information using current electronic medias like mobile phones, radio, internet, and television to the red onion farmers is expected to increase the farmers share via choosing a most profitable channel. government organizations or any other non-governmental organization can take effort to connect the buyer and producer by  Moreover if any of the non profiteering organization could come forward to perform the transport function on behalf of the farmers is expected to increase the farmers share tremendously. Organizing the red onion farmer societies or organizations is expected to increase the bargaining power collectively on behalf of the individual farmers. And this will intern expect to help the farmers to choose the most suitable and profitable marketing channel.

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ISSN : 2251-1555