Analysis of the Carrot Value Chain and Determinants of Outlet Choices by Smallholder Farmers in Nakuru County, Kenya

Abstract

Smallholder farmers had limited access to relevant market information for their farm produce, especially those from rural areas who entirely depended on rain-fed agricultural activities for their livelihoods. Specifically, smallholder carrot farmers were faced with numerous decisions in the allocation of available scarce resources, especially when dealing with several market failures and competitiveness bottlenecks that limited their productivity. Additionally, the supply of carrots in various market outlets in Kenya did not match the demand, yet they fetched a higher premium in formal market outlets. Thus, efforts to increase market participation among carrot producers had great potential to lift them to an overall better household income level. This study aimed to analyse the carrot value chain in Nakuru County with the specific objectives of understanding the available carrot market outlets/channels, gross margins along different market outlets/channels, as well as the main conditioning factors towards the development of a vibrant carrot value chain in a holistic manner. A multi-stage sampling method was employed to obtain a representative sample of 195 carrot farmers and 30 traders, and a semi-structured questionnaire was used to collect data through face-to-face interviews. Data collected were analysed using an Excel spreadsheet, SPSS, and STATA software. Accordingly, this study used a gross margin analysis, double hurdle model, and a multinomial logit model, and the results showed that more than two-thirds (81%) of the sampled carrot-producing households in Nakuru County marketed their produce (market participants). They sold their produce at the farm gate (29.94%), cleaning point (25.48%), local market (21.02%), external market (15.92%), and export market (7.64%). The carrots in the study area were mainly purchased by aggregators (33.76%), brokers (27.39%), wholesalers (18.47%), retailers (15.92%), and consumers (4.46%), particularly at the farm level. The gross margin analysis results indicated that carrot producers recorded positive average gross margins ranging from KES 44,800 to KES 113,200 per acre in the five market outlets. The results further suggested that gender, age, market distance, land size, experience, land size under carrots, household size, and distance to the cleaning point were important factors conditioning the household decision to choose a specific carrot market outlet, as well as the level/intensity of market participation. These findings imply that policymakers and other stakeholders should promote the reduction of several carrot market failures as well as competitiveness bottlenecks and support farmers to access credit and appropriate market information regarding demand and prices on various market outlets.