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Evolution and challenges of dairy supply chains: Evidence from supermarkets, industries and consumers in Ethiopia

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  • Francesconi, Gian Nicola
  • Heerink, Nico
  • D'Haese, Marijke

Abstract

In developing countries the demand for products of animal origin is expected to grow rapidly in the coming years. Using data collected from 200 urban households this study examines the evolution of the dairy market in Ethiopia. In particular, this study suggests that although the Ethiopian dairy market remains extremely thin and volatile, the commercialization of processed dairy products through supermarkets is expanding and is expected to keep doing so in the foreseeable future. Increasing urbanization and corresponding changes in consumer preferences, behaviour and purchasing power are the identified causes for the rise of supermarket-processor dairy chains. This study shows also that emerging dairy chains provide new market opportunities to Ethiopian farmers, but the existence of retail-industrial monopolies and monopsonies jeopardize farmers' economic benefits to a great extent. The study concludes with some implications for policy and further research.

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  • Francesconi, Gian Nicola & Heerink, Nico & D'Haese, Marijke, 2010. "Evolution and challenges of dairy supply chains: Evidence from supermarkets, industries and consumers in Ethiopia," Food Policy, Elsevier, vol. 35(1), pages 60-68, February.
    • Handle: RePEc:eee:jfpoli:v:35:y:2010:i:1:p:60-68
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    2. Shiferaw, K. & Gebremedhin, B. & Tegegne, A. & Hoekstra, D., 2018. "Analysis of milk production, butter marketing and household use of inputs in rural Ethiopia," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277104, International Association of Agricultural Economists.
    3. Eline D'Haene & Juan Tur Cardona & Stijn Speelman & Koen Schoors & Marijke D'Haese, 2021. "Unraveling preferences for religious ties in food transactions: A consumer perspective," Agricultural Economics, International Association of Agricultural Economists, vol. 52(4), pages 701-716, July.
    4. Negassa, Asfaw & Rashid, Shahidur & Gebremedhin, Berhanu & Kennedy, Adam, 2012. "Livestock production and marketing," IFPRI book chapters, in: Dorosh, Paul A. & Rashid, Shahidur (ed.), Food and agriculture in Ethiopia: Progress and policy challenges, chapter 6, International Food Policy Research Institute (IFPRI).
    5. Liz Ignowski & Bart Minten & Johan Swinnen & Bjorn Van Campenhout & Senne Vandevelde, 2021. "Trade, Value Chain Technology and Prices: Evidence from Dairy in East Africa," LICOS Discussion Papers 42221, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
    6. Alemu, Abebe Ejigu & Adesina, Jimi, 2015. "Effects of cooperatives and contracts on rural income and production in the dairy supply chains: Evidence from Northern Ethiopia," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 10(4), pages 1-16, December.
    7. Alemu, Abebe Ejigu, 2016. "Determinants Of Smallholders’ Preference To Hybrids – Prospect For Upgrading To High-Value Food Chains," Journal of Agribusiness and Rural Development, University of Life Sciences, Poznan, Poland, vol. 41(3).
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    9. Klerkx, Laurens & Nettle, Ruth, 2013. "Achievements and challenges of innovation co-production support initiatives in the Australian and Dutch dairy sectors: A comparative study," Food Policy, Elsevier, vol. 40(C), pages 74-89.
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    11. Abebe Ejigu Alemu & Jimi O. Adesina, 2017. "In Search of Rural Entrepreneurship: Non-farm Household Enterprises (NFEs) as Instruments of Rural Transformation in Ethiopia," African Development Review, African Development Bank, vol. 29(2), pages 259-271, June.
    12. Agata Malak-Rawlikowska & Dominika Milczarek-Andrzejewska & Jan Fałkowski, 2019. "Farmers’ Bargaining Power and Input Prices: What Can We Learn from Self-Reported Assessments? 1," Social Sciences, MDPI, vol. 8(2), pages 1-13, February.
    13. Fuentes Navarro, E. & Faure, G. & Cortijo, E. & De Nys, E. & Bogue, J. & Gómez, C. & Mercado, W. & Gamboa, C. & Le Gal, P.-Y., 2015. "The impacts of differentiated markets on the relationship between dairy processors and smallholder farmers in the Peruvian Andes," Agricultural Systems, Elsevier, vol. 132(C), pages 145-156.
    14. Gian Nicola Francesconi & Ruerd Ruben, 2012. "The Hidden Impact of Cooperative Membership on Quality Management: A Case Study from the Dairy Belt of Addis Ababa," Journal of Entrepreneurial and Organizational Diversity, European Research Institute on Cooperative and Social Enterprises, vol. 1(1), pages 85-103, December.
    15. repec:mth:jas888:v:7:y:2019:i:1:p:128-139 is not listed on IDEAS
    16. Bjorn Van Campenhout & Bart Minten & Johan F. M. Swinnen, 2021. "Leading the way – foreign direct investment and dairy value chain upgrading in Uganda," Agricultural Economics, International Association of Agricultural Economists, vol. 52(4), pages 607-631, July.
    17. Kebebe, E., 2019. "Bridging technology adoption gaps in livestock sector in Ethiopia: A innovation system perspective," Technology in Society, Elsevier, vol. 57(C), pages 30-37.
    18. Hussain, Safdar & Ahmed, Wasim & Rabnawaz, Ambar & Jafar, Rana Muhammad Sohail & Saqib, Zulkaif Ahmed & Ullah, Sana & JianZhou, Yang, 2016. "Client Intentions and Buying Behavior with Regard of Dairy Products-Review," MPRA Paper 70383, University Library of Munich, Germany.
    19. Yun-Cih Chang & Min-Fang Wei & Yir-Hueih Luh, 2021. "Choice of Modern Food Distribution Channels and Its Welfare Effects: Empirical Evidence from Taiwan," Agriculture, MDPI, vol. 11(6), pages 1-13, May.
    20. Mohammed Belal Uddin & Bilkis Akhter, 2022. "Investigating the relationship between top management commitment, supply chain collaboration, and sustainable firm performance in the agro-processing supply chain," Operations Management Research, Springer, vol. 15(3), pages 1399-1417, December.
    21. Bobojonov, Ihtiyor & Teuber, Ramona & Oshakbayev, Dauren & Glauben, Thomas, 2015. "Agrifood sector transformation and its implications on development of small farmers in Kazakhstan," 2015 Conference, August 9-14, 2015, Milan, Italy 211357, International Association of Agricultural Economists.
    22. Kebebe, E. & Duncan, AJ & Klerkx, L. & de Boer, I.J.M. & Oosting, S.J., 2015. "Understanding socio-economic and policy constraints to dairy development in Ethiopia: A coupled functional-structural innovation systems analysis," Agricultural Systems, Elsevier, vol. 141(C), pages 69-78.
    23. Boniface, Bonaventure & Umberger, Wendy J., 2012. "Factors influencing Malaysian consumers’ consumption of dairy products," 2012 Conference (56th), February 7-10, 2012, Fremantle, Australia 124243, Australian Agricultural and Resource Economics Society.

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