Economic analysis of the factors that influence the beef cattle marketing behaviour in pastoral areas of Kenya: case study of the impact of livestock market information in Garissa and Isiolo districts.
The pastoral areas of Kenya comprise over 80 % of the country's land area. These areas are inhabited by over 10 million people whose livelihoods mostly hinge on livestock. The area hosts over 70 percent of the national cattle herd; with an annual slaughter of over 1.6 million total livestock units. However, above 70 % of the population in these areas live below the poverty line. Available literature has revealed little knowledge on the factors that influence marketing behaviour of beef cattle producers in pastoral areas of Kenya. The purpose of this study was to carry out economic analysis of the impact of livestock market information and its influence on beef cattle marketing behaviour among other factors and to identify important attributes used in beef cattle valuation by producers and how these attributes affects price differential from the traders perspective. The study employed a combination of purposive and random sampling in a survey of market sheds in two districts of Kenya's rangelands, namely Garissa and Isiolo. This survey generated primary data from 135 respondents. Secondary data was sourced from LINKS website and statistical abstracts from Central Bureau of Statistic and FAO yearbook. Regression methods of analysis usmg Nerlove Supply Response model (NSR) and the Consumer Goods Characteristics Model (CGCM) were employed to explore the stated objectives. The study findings were: One, that beef cattle sector in Kenya has low response to price, this response is negative for the current price and positive for one year lagged price. Two, livestock market information does not influence beef cattle household off-take decision, these decision are rather influenced by calving rate, purchase rate, off-pastoral income and dependency ratio. And three, that animal attributes such as animal class, grade, sex, and other variables like market location and volume were important determinants of beef cattle price. These attributes show significant price differentials between each other and within each other. The attributes were ranked as important by livestock producers when determining which animal to sell. From these findings, the following conclusions were drawn; firstly, that beef cattle sector in Kenya has responded in an economical manner to changes in beef cattle prices. This response was initially, in a perverse manner, explained by the treatment of cattle as capital goods and eventually in a positive manner. Secondly, that livestock market information does not influence producer off-take decision; a plausible explanation could be that pastoral households based their decision on household needs which accounted for 91 % of the reasons why households sell their livestock. This could also be attributed to the fact that disseminated livestock information reached the isolated villages too late when it was no longer relevant or accurate. Thirdly, that there was a well differentiated pricing system for beef cattle based on animal attributes such as animal class, grade, sex and that these attributes are used both by the livestock traders and producers in valuation. The following recommendations are deduced from the study. One, that a framework for reporting market information needs to be established to take into account the standardization of reporting based on animal attributes. Secondly, on factors influencing beef cattle off-take, the study proposes the improvement of breeds in order to minimize their calving intervals; this should be coupled with investment in infrastructure, access to extension service including veterinary services. Further, an expansion of source of income for pastoral households will be achieved through increase investments in other sectors in pastoral areas. In conclusion, the study extends analysis of the factors influencing beef cattle marketing behaviour to variables hitherto unexplored in the literature. It uses market transactional data to provide a body of empirical verifiable research results regarding attributes that are important in beef cattle market information packaging. These findings provide important insights into the ability of market information to accomplish its intended goal of enhancing efficiency of livestock price discovery. An,d wealth of information to guide the policy maker as regard interventions needed to spearhead development in the pastoral communities of Kenya and beyond.