Seneshaw Tamru

Structural Transformation of Cereal Markets in Ethiopia

Abstract We study cereal markets in Ethiopia over the last decade, a period that has been characterised by important local changes, including strong economic growth, urbanisation, improved road and communication infrastructure, and higher adoption of modern inputs in agriculture. These changes are associated with better spatial price integration as well as with significant declines in real price differences between supplying and receiving markets and in cereal milling and retail margins. In short, important improvements have occurred in Ethiopia’s cereal marketing system. This is especially important because dysfunctional cereal markets were previously identified as an important cause of food insecurity in the country.

Transforming Staple Food Value Chains in Africa: The Case of Teff in Ethiopia

Abstract We study changes in the last decade in the teff value chain, Ethiopia’s most important staple food crop by area and value. Upstream, there is increasing adoption of modern inputs and new varieties – especially by those farmers living close to cities – leading to higher land productivity. Mid- and downstream, we find improved processing costs and increasing willingness-to-pay for convenience and quality, as illustrated by the emergence of one-stop retail shops and the rise of more expensive teff varieties. Because of the large numbers of teff producers and consumers, this transformation has important implications on the country’s food security.

Feeding Africa's cities: The case of the Supply Chain of Teff to Addis Ababa

Urbanization is quickly increasing in Africa, raising important questions on how food value chains to cities function and what the implications of urban growth are for the local food trade and farm sector. We study the rural-urban value chain of teff in Ethiopia, by value its most important staple value chain. Relying on unique large-scale surveys at different levels in this value chain, we find—in contrast to conventional wisdom—that value chains are relatively short and that average farmers obtain a high share, about 80%, of the final consumer price in the major terminal market, Addis Ababa. We further find that producer prices decline in line with transportation costs, the farther farmers live from the city; that seasonal price movements are rather small; and that average stock release by farmers is smooth over the year.

The Rapid Expansion of Herbicide Use in Smallholder Agriculture in Ethiopia: Patterns, Drivers, and Implications

Adoption of herbicides by Ethiopian smallholders has grown rapidly, with application on cereals doubling to more than a quarter of the area under cereals between 2004 and 2014. Relying on unique data from a large-scale survey of producers of teff, the most widely grown cereal in Ethiopia, we find considerable positive labor productivity effects of herbicide use of between 9 and 18 per cent. We show that the adoption of herbicides is strongly related to proximity to urban centers, access to all-weather roads, and levels of local rural wages. All these factors have changed substantially over the last decade in Ethiopia, explaining the rapid take-off in herbicide adoption. The sizable increase in herbicide use in Ethiopia has important implications for rural labor markets, potential environmental and health considerations, and capacity development for the design and effective implementation of regulatory policies on herbicides.Cet article étudie l’utilisation des herbicides en Éthiopie. Il révèle une augmentation rapide des importations d’herbicides dans le secteur privé en Ethiopie (une valeur quadruplée au cours de la dernière décennie). L’adoption des herbicides par les petits exploitants a augmenté rapidement, en particulier l’application dans le domaine des céréales qui a plus que doublé au cours des dix dernières années, attenant plus d’un quart de ce secteur en 2014. Nous constatons d’importants effets positifs sur la productivité du travail pour ceux qui adoptent de 9 à 18 pourcent. Nous montrons que l’adoption des herbicides est fortement liée à la proximité d’une ville, aux salaires ruraux, et à l’accès aux marchés. Tous ces facteurs ont considérablement changés au cours de la dernière décennie en Éthiopie, ce qui semble expliquer la popularité de l’adoption des herbicides. Ce changement a des répercussions importantes sur les marchés du travail ruraux, sur les considérations potentielles en matière d’environnement et de la santé, et sur les besoins en matière de renforcement des capacités pour la conception et la mise en œuvre de politiques réglementaires.

Ethiopia's Growth and Transformation Plan: A Computable General Equilibrium Analysis of Alternative Financing Options

Under the Plan for Accelerated and Sustained Development to End Poverty (PASDEP), implemented from 2005/06 to 2009/10, Ethiopia achieved rapid economic growth and laid a foundation for future growth by making substantial investments in infrastructure and human capital. Regardless of the financing strategy, the high TFP and GDP growth rates under the GTP imply high average income growth for both poor and rich households, in both rural and urban areas. Because the GTP involves a greater concentration of investment in non-agricultural sectors than did PASDEP, growth of incomes of urban households is higher in the GTP than under PASDEP. Conversely, income growth of the rural poor is slightly lower under the medium growth scenario with domestic savings (10.0 percent) than under a continuation of PASDEP growth and investment (10.6 percent). Thus, this analysis shows that if the GTP investment and sectoral growth targets are achieved, real incomes of the poor in Ethiopia would rise substantially. The base simulations indicate that real incomes of the poor rose under PASDEP from 2005/06 to 2010/11. Under GTP, this real income growth would be accelerated, provided there is sufficient foreign savings or mobilization of domestic savings to achieve the targets. Nonetheless, the simulations also suggest that agricultural growth will still be crucial for raising incomes of Ethiopia’s rural poor. Thus, investments that raise agricultural productivity will need to continue in order to ensure that the rural poor share in the substantial projected benefits that would result from achieving the high economic growth targets of the GTP.

Cities and Agricultural Transformation in Africa: Evidence from Ethiopia

Due to the rapid growth of cities in Africa, a larger number of farmers is living in the rural hinterland providing food to urban residents. However, empirical evidence on how urbanization affects these farmers is scarce. To fill this gap, this paper explores the relationship between proximity to a city and the production behavior of rural staple crop producers. More in particular, we analyze unique data from teff producing farmers in major producing areas around Addis Ababa, the Ethiopian capital. We find that farmers more closely located to Addis Ababa face higher wages and land rental prices, but because they receive higher teff prices they have better incentives to intensify production. Moreover, we observe that modern input use, land and labor productivity, and profitability in teff production improve with urban proximity. There is a strong and significant direct effect of urban proximity, which is suggested to be related with more use of formal factor markets, less transaction costs, and better access to information. In contrast, we do not find strong and positive relationships of rural population density increases - as an alternative source of agricultural transformation - as they seem to lead to immiserizing effects in these settings. Our results show that urban proximity should be considered as an important determinant of the process of agricultural intensification and transformation in developing countries.