Research Journal of Economics & Business Studies - RJEBS - The ...

produce. If the producer is unaware of the market price then that will lead to market imperfections and
finally producer may end up with a lower producer margins. Same variable also exerted a positive
impact and encouraging farmers’ participation in the marketing channel 3 (directly selling to the
transporter). Since the coefficient is found to be insignificant there no point in discussing the impacts
based on that value. Hence it is obvious that dissemination of market information is quite crucial in
enhancing the farmers’ share in the market. Market information should be readily available and it has
to reach the farmers field regularly. If farmers could access the market information from some reliable
sources then that will in turn help the farmers to get reasonable margins in the red onion business. In
the mean time market will also move towards competitive nature.
The variable ‘last year investment’ found to be statistically significant at 1 percent level and
exerting a negative impact on the market participation via both channel 2 and channel 3: directly
performing transporting. Increasing the investment in last season by one unit will expected to increase
the respondents’ market participation in market selling to wholesaler through middle man by the log
ratio of selling to wholesaler through middle man based on directly performing retailing is -14.058.
This means that increasing the investment in last season is expected to discourage the market
participation of the farmer in the market selling to wholesaler through middle man. The second
regression also implies the same. The farmers would have been discouraged to sell their produce
directly to the transporter. More investment during the last season will expected to discourage the
farmers’ participation in the marketing activity by the log ratio of channel 3 to channel 1 is -19.438.
Even though previous adverse seasonal experience de motivate the red onion farmers to participate in
the marketing activities but it prominently discourage the farmers to participate in the marketing
activity particularly through the marketing channel 3 rather than the marketing channel 2. Unexpected
heavy rain followed by a flood destructed most of the farmers during the last season and that would
have discouraged the farmers to cultivate more in this season and may resulted a reduced participation
in the red onion marketing channel. To overcome this farmer can be given credit during the successive
seasons. More over crop insurance or income subsidies to the affected farmers will also expect to
increase the farmers’ participation in the marketing activities.
The variable ‘investment in future’ is also found to be statistically significant at 5 percentage
level and exhibited a positive sign in choosing the marketing channel 2 (selling to wholesaler through
middle man). Increasing the investment in future by one unit will expected to increase the respondents’
market participation in market selling to wholesaler through middle man by the log ratio of selling to
wholesaler through middle man based on directly performing retailing is 3.148. This means that
increasing the investment in future is expected to encourage the market participation of the farmer in
the market selling to wholesaler through middle man. If the farmer would have invested heavily on the
production then it is reasonable for him to expect a quick return for his harvest. This is primarily due
the opportunity cost of the capital that farmer has invested. In most instances farmers have less
contacts and poorly knowledge about the market arrangements. Unless farmers have some contract or
coordination it is fairly difficult for them to organize a market for their products. This could be the
reason why farmers prefer to go to the middlemen to market their products without delay. To
overcome this, government organizations or any other non-governmental organization can take effort
to connect the buyer and producer by using current electronic medias like mobile phones, radio,
internet, and television.
‘Member in a producer group’ found to be statistically significant at 10 percent level and
manifested a negative sign in choosing the marketing channel 3. Being a member in a producer
organisation will expect to decrease the farmers’ market participation in the marketing channel 3 by
the log ratio of -1.985. This is obvious because the farmer organizations bargain on behalf of its
members and participate in the market. So the farmer may not be able to participate in the market
directly. Instead the farmer organization takes effort to market the harvest. But unfortunately farmer
organizations in the Jaffna district are not well established yet. These organizations are suffering from
www.theinternationaljournal.org > RJEBS: Volume: 02, Number: 06, April-2013 Page 49