MARKET ANALYSIS OF THE GOAT SUPPLY CHAIN IN WONAGO WOREDA, GEDEO ZONE, SOUTHERN ETHIOPIA

ABSTRACT Market chain analysis is crucial for understanding market dynamics, the interactions between different participants, and the key barriers hindering the growth of goat marketing. This study focused on analyzing the goat market chain in the Wonago Woreda of the Gedeo Zone in southern Ethiopia. Primary data were collected from 196 goat producers, 30 traders, and 20 consumers. The data were analyzed using descriptive statistics and econometric models. The findings reveal that the goat market in Wonago operates under a weak oligopolistic structure, with a concentration ratio (CR4) of 41.17%, indicating the dominance of a small number of traders. While price is the main competitive factor, a significant proportion of traders (58.83%) build customer loyalty through fair pricing and accurate weighing practices. The overall marketing margin stands at 25%, with local collectors taking the largest share. Goat producers face significant challenges, including fluctuating demand, price instability, disease risks, poor infrastructure, limited access to credit, and inadequate market information, all of which negatively impact their livelihoods and market efficiency.. Probit regression analysis found that credit access and education significantly influence market participation, while Heckman selection regression indicated that the gender of the household head and cooperative membership play crucial roles in goat supply. The Heckman selection model is often considered superior to other methods in situations where selection bias is a concern because it directly addresses the problem by modeling the selection process and adjusting for it. To improve market efficiency and sustainability, the study recommends enhancing market information systems, improving credit access, investing in rural infrastructure, promoting cooperatives, offering education and training on best practices, and advocating for increased government support in the goat sector