Choice of Market Participation Channels for Indigenous Fruits and Vegetables Producers in Ghana

Abstract

The choice of marketing channels is crucial for smallholder farmers, especially in the African Indigenous Fruits and Vegetables (IFVs) sector, where markets are often informal and fragmented. This study examines the factors influencing IFV farmers’ market channel choices in Ghana, focusing on farm gate sales, local markets, farmer-based organizations, and intermediaries. Using cross-sectional survey data from 289 IFV farmers across all sixteen administrative regions, a Multivariate Probit (MVP) model was used to analyze the simultaneity and interdependence of farmers’ marketing decisions. Institutional support, particularly membership in Farmer-Based Organizations (FBOs), increases the likelihood of farmers participating in structured markets like selling through FBOs, which typically offer better sales outcomes due to collective bargaining. The results show that selling at the local market and the farm gate are the most common market participation channels, while intermediaries and FBOs are less popular. Key factors influencing market participation include gender, education, farm size, land ownership, experience with post-harvest losses, and access to extension services. Female farmers are more likely to sell at the farm gate, while farmers in northern Ghana rely more on intermediaries. Higher education levels tend to negatively affect market access through intermediaries, and larger farm sizes are associated with selling via FBOs and intermediaries. Contract farming and access to extension services help reduce dependence on farm gate sales and intermediaries. Farmers with fewer post-harvest losses are less likely to sell at local markets, through FBOs, or via intermediaries. The findings highlight the need for targeted policies that expand access to structured markets while decreasing reliance on informal channels.