Value chain analysis of tomato: The case of Bure, Jabitehinan and North Mecha districts of Amhara regional state, Ethiopia

Ethiopia is still in the early stages of implementing agricultural value chains in general, and the tomato value chain in particular. Tomato production in Bure, Jabitehinan, and North Mecha Districts has played a critical role in generating income and creating jobs for many smallholder farmers, resulting in poverty reduction. Tomato growers, on the other hand, faced numerous challenges, including lack of clear tomato value chain depiction, poor product value addition, frail value chain linkage, and the perishable nature of the crop itself. As a result of these issues, tomato growers experienced low product prices, a lack of market information, and market inefficiencies, all of which limited the potential benefit of tomato value chain actors. Therefore, this study was aimed to mapping tomato value chain actors, their roles and linkages; to identify the major tomato market channels, and analyzing the structure, conduct and performance (S-C-P) of tomato value chain in the selected districts. Data were collected from both primary and secondary sources. Primary data were collected from randomly selected 280 tomato producers and 60 traders. To improve the validity of the data, the researchers were used focus group discussion and key informant interview in two rounds with a total size of 10 participants per discussion and secondary data were included from published articles and unpublished district reports. A multi-stage random sampling procedure was applied to select tomato producers and random sampling for traders. Descriptive statistics was applied to analyze data and generate valuable information on market structure, conduct and performance of tomato value chain. The survey result shows that input suppliers, producers, rural collectors, retailers, wholesaler, processors and consumers were identified as core tomato value chain actors. From the survey result, only 40.7% of the total respondents stated that tomato value addition was implemented and practiced. The perishability nature of the product and the low value addition practice of producers were led to less beneficiary in the tomato value chain. Processors obtained 44.82% of the profit share, which is the highest amount of profit share among other tomato value chain actors. Result from analysis of market concentration indicated that tomato market characterized by oligopolistic market structure with the buyers' concentration ratio of 45.53%. Market conduct shows that 73.21% of the price of tomato was set by traders while producers were price taker. Regarding to the market performance analysis, the highest TGMM was registered in channel X which accounts the estimated percentage share of 75% of consumer price. This study recommended that the decision maker should take-up initiative for strengthening of tomato value chain performance by capacitating farmer association to increase their bargaining power and supporting actors involved in local tomato markets. In addition, it is recommended that the government of the region should developed a policy that reduce oligopolistic tendency of market structure so as to create competitive tomato market environment for all actor in the market.