What attributes do Uganda pig traders
consider to maximize returns and utility?: A
choice experiment application
Nadhem Mt...
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What attributes do Uganda pig traders consider to maximize returns and utility?: A choice experiment application

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Poster prepared by Nadhem Mtimet (ILRI), Emily Ouma (ILRI) and Derek Baker (ILRI) for the Agrifood chain toolkit conference: Livestock and fish value chains in East Africa, Kampala, 9-11 September 2013.

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What attributes do Uganda pig traders consider to maximize returns and utility?: A choice experiment application

  1. 1. What attributes do Uganda pig traders consider to maximize returns and utility?: A choice experiment application Nadhem Mtimet, Emily Ouma and Derek Baker International Livestock Research Institute Pictures Emily A. Ouma e.a.ouma@cgiar.org ● Box 24384 Kampala ● +256 39-2-081154/5 Kampala Uganda ● ilri.org This project is funded by IFAD/EU This document is licensed for use under a Creative Commons Attribution –Non commercial-Share Alike 3.0 Unported License June 2012 September 2013 Actors in a Typical Pig Value Chain Farmers working on the seasonal calendar Background and rationale  Pig production is increasingly becoming an important economic activity for smallholder famers, especially women: about 32% of women currently involved in pig production compared to only 15% 10 years ago (UBOS, 2009).  They lack voice and bargaining power as they are not organised and individually sell their pigs to traders at farm gate.  Main market outlets include neighbor-hood butchers (60%) and live pig traders (20%).  Price is determined by traders based on visual estimates of carcass-weight equivalent of the live pigs and other factors that are never clear to the farmers. Has resulted in mistrust by the farmers who often lack capacity to make such estimates  Purpose: Investigate the attributes preferred by the pig traders in order to inform farmers to produce pigs that meet the needs of the market. Butchery traders in Gulu district Choice experiment methodology  Based on Lancasterian consumer framework and random utility theory. o Focus on attributes that a good posses  Step 1 : 6 attributes were identified by traders as important. o Weight and purchase price of the pig o Apparent health o Age o Pig type (female, castrated male, un-castrated male) o Pig back-fat layer  Step 2: Different levels associated with each of the attributes were identified.  Step 3: Run a fractional factorial experimental design to come up with the optimal attribute level combinations. Result was a total of 12 choice sets each with 3 choice alternatives.  Step 4: Choice experiment surveys administered to 42 pig traders in Mukono and Kamuli districts between May and July 2013.  Step 5: Modeling using conditional logit to obtain estimates of the values of each attribute. Pig trader participating in a choice experiment interview in Ntenjeru in Mukono district Attribute Coefficient Standard error P-values Good apparent health 1.922 0.176 0.000 Thin fat layer 0.464 0.144 0.001 Age of the pig -0.072 0.012 0.000 Female -0.041 0.159 0.799 Un-castrated male -0.440 0.205 0.032 Price (in ‘000’) 0.016 0.008 0.041 Price2 -0.000 0.000 0.084 Log likelihood function = -262.377; Pseudo-R2 = 0.3137; N=1044 Conditional logit model results Results  Preferred pig attributes: o Apparent good health - strongly preferred. o Thin fat layer compared to thick layer. o Young (6-12 months compared to 24 months) o Castrated males most preferred followed by the females  Price linked to quality of pigs (+positive first order coefficient and – negative quadratic form): utility associated with increasing prices up to a point where further increment results in diminishing utility) Next steps  Interact choice variables with socio-demographic characteristics of the traders

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