Determinants of Smallholder Commercialization of Tomato Crop in Siltie Zone, Southern Ethiopia

Abstract

The productivity of agricultural resources was very low; especially in the developing world where production is common on fragile lands and characterized by small-scale subsistence farming. Commercialization of agriculture provides farm households with a means to alleviate poverty and food insecurity by generating incomes in the rural areas. This paper aims to identify factors affecting commercialization of tomato crop by smallholder farmers in Siltie Zone, Southern Ethiopia. Both structured and unstructured questionnaires and Focus Group Discussion were used to collect data from 175 respondents randomly selected from designated locations in the study area. Descriptive statistics and heckman two stage models were used to analyze the collected data. According to first stage Heckman selection estimation (probit regression) model result, Education, frequency of extension contact, distance to market, market agreement and lagged price played a significant role in smallholder commercialization decision. In the second-stage of Heckman selection estimation family size, education, land allocated for tomato production, frequency of agricultural extension contact, distance to nearest market, productivity, lagged price and inverse mill’s ratio were significantly affect level of tomato commercialization. Thus, the study recommends the need for designing appropriate intervention mechanisms focusing on the abovementioned factors so as to improve the performance of tomato crop commercialization.