Determinants of market channel choice by Tissue Culture Banana Farmers in Central Kenya

Introduction

Banana is a major staple crop supporting over 30 million people in East Africa, with potential for alleviating food and nutrition insecurity. Banana farming in East Africa is mainly dominated by smallholder farmers with a minimum of 30 banana stalks (Wahome et al., 2021). However, the success of banana growing has been curbed by many constraints, among them are bacterial xanthomonas diseases, banana weevils, and nematodes (Mulugo et al., 2022). Tissue culture banana technology is a biotechnology innovation introduced by Africa Harvest to the Kenyan smallholder farmers with an aim of producing clean planting materials of banana, and ameliorating the disease rates in banana production (Bandewar et al., 2017). Despite the benefits accrued to tissue culture bananas, such as high yields, disease and pest resistance, and drought tolerance, the adoption of tissue culture bananas by farmers is still low (Wardhiani et al., 2023). Limited marketability of the tissue culture bananas and their products to both local and national markets is one of the major limiting factors for adoption in Central Kenya. In light of this, the tissue culture banana farmers have come together to form farmer cooperatives. The farmer cooperatives in Kenya incentivize their members through availing subsidized pesticides, fertilizers, quality control services, and financial services like credit. Such incentives are hardly afforded by individual farmers and other groups. This, therefore, increases the farmers’ interest and confidence to participate and sell their produce through cooperatives (Musuya, 2014).

As part of a student challenge under the Agri-Scale project that took place in October 2023 at Jomo Kenyatta University of Agriculture and Technology. The GIKAMA farmer cooperative in Murang’a county, central Kenya, was one of the central focuses of the student challenge. This cooperative deals with the marketing of tissue culture banana and other agricultural products. The cooperative started in 2006 with only 16 members. The cooperative overtime has gained momentum with the current membership of about 35 members. Despite the continued support and benefits offered by the GIKAMA cooperative, the cooperative members continue to sell their tissue culture banana produce to other marketing channels. This negatively affects the efficiency and effectiveness of the cooperative and thus compromises its sustainability (Jussila et al., 2012). In this view, it becomes indispensable to establish the factors influencing the tissue culture banana farmers’ choice of marketing channel. Therefore, in this study, our group focused on addressing the following research questions: i) What are the characteristics of the tissue culture banana farmers in the GIKAMA cooperative? ii) What are the factors influencing the choice of a particular marketing channel used by tissue culture banana farmers in the GIKAMA cooperative?

Methods and Methodology

Study area and research design

The research design used in this study was cross-sectional with a purposive sampling technique. Murang’a County in Kandara constituency in central Kenya was purposively selected for this study. This county is one of the fastest-growing areas of tissue culture bananas in central Kenya, with an organized and efficient GIKAMA farmer cooperative (Wahome et al., 2021).

Data collection and analysis

The data was collected in Kandara Constituency, Murang’a County, in central Kenya in October 2024. Only the subscribed members of the GIKAMA cooperative who actively participate in tissue culture banana growing were interviewed using open-ended questionnaires. Before actual data collection, the questionnaires were tested using students from other groups to ascertain the tool’s validity and reliability. A focus group discussion with about 7 farmers was carried out to obtain qualitative data from the farmers (Akyildiz & Ahmed, 2021). The data was analyzed using SPSS software version 24 to obtain the descriptive statistics.

Results and discussion

Social demographic characteristics of GIKAMA cooperative tissue culture banana farmers.

The study revealed that of the GIKAMA cooperative members 68% were male and 32% female. This implies that the cooperative is highly dominated by the male counterparts. Despite the fact, the studies show that a higher percentage of women are involved in active agriculture, agriculture continues to be patriarchal, where males make critical decisions pertaining to pre- and post-agricultural activities to be done (Uzokwe et al., 2017). The majority of the farmers interviewed (95,5%) were above 40 years of age. The higher proportion of older members in the cooperative may lead to sluggish performance. This is attributed to a decrease in the energy and productivity in the execution of managerial duties by older members, as well as reduced interest in formal participation in the farmer cooperative (Nxumalo et al., 2019, & Nangobi et al., 2023).

Factors that influence farmers to choose a given marketing channel

The study revealed that the benefits offered by the cooperative influenced the farmers’ choices to market their produce through the cooperative.The findings revealed that70% of the cooperative members chose to sell their produce to the GIKAMA cooperative due to incentives, such as agricultural training, inputs such as fertilizers and pesticides offered by the cooperative. However, 30% of the cooperative members choose to sell their produce to the GIKAMA cooperative due to easy market accessibility, value addition, and fair prices offered by the cooperative. This is consistent with Frye (2017), who found that offering an incentive is a strategy to foster effective participation and interest in any farmer organization.

Despite the benefits and incentives offered by the cooperative, only 65% of the members sold their produce solely to the cooperative. A significant percentage (35%) of the farmers sold their tissue culture banana produce to both cooperative and middlemen, thus operating in a mixed market channel system. Focus group discussion revealed that these farmers sell their produce to the middlemen as an alternative market channel, mainly because of the price offered by the cooperative and the middlemen. Sometimes the cooperative gives a constant price (lower) even when the demand for the produce has gone higher. “I sell my produce to the middlemen who give a better price than the cooperative gives”, said one of the interviewed farmers. Therefore, variation in the prices offered by the cooperative is a critical factor contributing to the farmers’ decision to sell their produce to an alternative market channel. This result is supported by Leroux et al. (2010), who report that the profitability of a given market channel enhances the participation and commitment of the farmers to continue using the channel.

Similarly, the results showed that the cooperative members who stay closer to the collection point (less than 1 kilometer away) sell their produce through the cooperative. However, the cooperative members who stay far from the cooperative collection point (> 1 kilometer) also constitute the farmers who choose to sell their produce to the middlemen. Farmers asserted that the cooperative apparently only transports the product aggregated at a particular collection point. This constrains the members who must incur the transportation costs if their produce is to be sold through the cooperative. We cannot afford the transportation fares for the produce most of the time, and therefore, the best option is to sell to the middlemen who pick the produce from the farm gate. This means that the physical distance to the closest market channel strongly influences the choice of the marketing channel. The greater the distance, the more inclined the farmers would be to choose an alternative market channel that can easily be accessed (Zhang et al., 2017).

Furthermore, the payment efficiency offered by a market channel is a key factor that attracts farmers. Findings from focus group discussions indicated that the majority of farmers chose to sell to the middlemen because of their instant payment as compared to the delayed payment by the cooperative. “We receive payments after two weeks from the day of purchase”, said the farmers in the focus discussion group. This causes farmers to sell their produce to the middlemen who offer instant payment. The pricing and payment strategy greatly determines the strength and stability of the cooperative. The cooperative may decide to leave the cooperative if the pricing and payment strategy is poor, even when they hold strong intrinsic motivations to join the cooperative (Barry & Rousselière, 2022).

Conclusions

This study defined the factors that influence the GIKAMA cooperative tissue culture banana farmers to choose a given market channel. According to our results, economic and accessibility factors influence the chosen market channel. Results showed that economic benefits such as good price and instant payment offered by the middlemen motivate farmers to sell their produce to this market channel rather than to sell to the cooperative of which they are members. Results also revealed that longer distances from the cooperative collection point influenced farmers to sell their produce to the nearest market channel (middlemen). However, incentives offered by the cooperative, such as agricultural inputs, enhance the farmers’ participation in the cooperative.

Limitations

This study was carried out within a short time period with little data collected, as well as a small number of interviewees, which is not representative enough to infer the findings on the general population of tissue culture banana farmers in central Kenya.

Recommendations

In light of our research findings, for a better performance of the GIKAMA agribusiness cooperative, the management should ensure that prices are competitive, and instant payment should be given upon produce delivery. Transportation of the product from the farm gate to the cooperative is pivotal in ensuring easy access, especially for farmers who are farther from the cooperative collection point. Furthermore, the farmer cooperative needs to keep a balanced ratio of younger to older members and improve the gender ratio for increased competitiveness and productivity of the cooperative.