i

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 WOLKITE UNIVERSITY
COLLEGE OF AGRICULTURE AND NATURAL RESOURCE

DEPARTMENT OF AGRICULTURAL ECONOMICS

CONSTRAINTS OF FRUIT MARKETING IN ETHIOPIA

A SENIOR SEMINAR PAPERS

PREPARED BY ID NO
LANDE ABRAHAM 1313/13

ADVISOR: Moti

JANUARY,2023

Wolkite,Ethiopia

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TABLE OF CONTENT
TABLE OF CONTENT..................................................................................................................ii
ACKNOWLEDGMENT................................................................................................................iii
ABSTRACT.....................................................................................................................................iv
LIST OF TABLES..........................................................................................................................vi
TABLE 1: Fresh Fruits Production Trends, 1998-2003……………………………….............vi
ACRONYMS................................................................................................................................vii
1.INTRODUCTION........................................................................................................................1
1.2.Background of the review......................................................................................................1
1.2 Justification............................................................................................................................3

1.3 Objectives of the review........................................................................................................5

1.3.1 General objectives..........................................................................................................5
1.3.2. Specific objectives.........................................................................................................5
1.4.Significance of the seminar...................................................................................................5
2. Literature Review........................................................................................................................6
2.1. Theoretical review................................................................................................................6
2.2 Emperical review.............................................................................................................8
2.2 Fruit consumption..................................................................................................................9
2.3 Fruit Marketing....................................................................................................................10
2.3.1 General Fruit Marketing...............................................................................................10
2.3.2 Domestic market...........................................................................................................11
2.3.3 Foreign market of fruit..................................................................................................12
2.4 Constraint of fruit marketing...............................................................................................13
2.4.1 Markets and Market Access..........................................................................................13
2.4.2 Lack of skilled labor resources and technical know-how.......................................14
2.5 Opportunities for increased fruit marketing........................................................................15
3. CONCLUSIONS AND RECOMMENDATION......................................................................17
4. REFERENCE............................................................................................................................20

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ACKNOWLEDGMENT

First of all, I would like to give thanks to the Almighty God for being my help, aid and
guidance , and also for providing me with the strength to accomplish this review. Next i would
like to extend my special acknowledgment to our advisor Moti, for his invaluable comments,
encouragements and guidance at various stage of writing this senior seminars paper. I want to
extend my thank to our coordinator Mebrat, whose encouragement, guidance and support from
the initial to the final level enabled us to develop an understanding of the subject. And ofcourse
my deepest gratitude goes to my family for their unflagging love and support both morally and
financially throughout my life; this seminar would be impossible without them. I offer my
regards and good wishes to all of those who supported me in any respect during the completion
of this seminar, especially Wolkite university for giving me free internet services that helped me
to complete my work on a given time without any connection problems.

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ABSTRACT
Agriculture is the corner stone of Ethiopian economy in which it play a great role in growth
domestic production. Fruit are a versatile product that, depending on need, can be consumed
within the household or sold in the market. This review is aimed at reviewing the organizations,
linkages and lines of movements of fruit products to understand the major constraints of
marketing functions and opportunities to improve fruit production and marketing. The following
provides a brief summary of the findings of the study. Different types of fruit are grown in
Ethiopia with different intensities in terms of land and other input allocation, purpose of
production, and marketability. Most of the fruits produced in Ethiopia are consumed locally and
are produced by small holder farmers. Fruit are not common items in the Ethiopian diet. In
particular the fruit consumption, compared to other African countries, is low. Fruits are
produced in some specific locations in Ethiopia and supplied to the local markets and to the
neighboring countries. The export of fresh fruit began to develop in the early 1970s. About 36
countries imported Ethiopian fruits and vegetables. However, private sector efforts to export to
Europe and Middle Eastern countries were thwarted by the Derg regime, and exports fell
drastically after the 1974 revolution. The size of the domestic market for fruit is very limited and
not diverse. The major constraints of marketing include lack of markets to absorb the
production, low price for the products, large number of middlemen in the marketing system, lack
of marketing institutions safeguarding farmers' interest and rights over their marketable
produces (e.g. cooperatives), lack of coordination among producers to increase their bargaining
power, poor product handling and packaging, imperfect pricing system, lack of transparency in
market information system mainly in the export market. Informal transaction prevails in the
export system. Producers and local traders receive value for their products only after the
exported product is sold. There is a lack of standard for quality control and hence lack of
discriminatory pricing system that accounts for quality and grades of the products. Different
recommendations are forwarded. Putting the market right through institutionalizing the
marketing system, the commission agents' functioning, grades and standards, improving the
export system by improving the transparency in the price setting system are crucial
interventions. Finally, the government should review the export price, which is determined
through negotiations.

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LIST OF TABLES

TABLE 1: Fresh Fruits Production Trends, 1998-2003………………………………

TABLE 2: Summary of fruit consumption patterns……………………………..

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 ACRONYMS
CSA Central Statistical Authority
EFVME Ethiopian Fruit &Vegetables marketing enterprise
FAO Food and Agricultural Organization
F&V Fruit &Vegetables
GTP Growth and Transformation Plan of Ethiopia
Ha hectares
IFAD International Fund for Agricultural Development
MoARD Ministry of Agriculture and Rural Development
NGOs Non Governmental Organizations
PASDEP Plan for Accelerated and Sustainable Development to End Poverty

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1. INTRODUCTION
1.1 Background of the review

Fruit production is an important of horticulture that plays a pivotal role in the livelihoods and
nutritional security of community in the country. Its production has risen by 7% annually since
1997; and the bulk of these fruits (98%) are grown in developing countries. As Yeshitla (2004)
indicated the latest figure shows that pineapple accounts for 44% of the total traded volume,
followed by mangoes (27%), avocados (12%) and papayas (7%). The main reason for increase in
demand of tropical fruits is the growing familiarity of consumers with tropical fruits; their taste,
nutritional value and cooking qualities Due to the existence of large agro-climatic diversity,
favourable soil conditions and ample water resources , different tropical, subtropical and
temprate fruit crops are grown in different part of the country. Hence, a variety of fruits can be
produced in the country making fresh-produce available year-round. Ethiopia has also a
comparative advantage for successful production of various fruit crops due to its proximity to
major market ( Europe and Middle East) and availability of young and easily trainable work
force.
Fruit crop allows efficient utilization of resources like land, water, labor and agricultural inputs ,
resulting in higher income per unit of available resource while maintaining and developing the
national resource base. The contribution of fruits toward diversification of the economy of the
country is also enormous. The development of fruit crops could provide the basis for the
establishment of agro-industries, contributing for the transformation of the Ethiopian agriculture.

As Lumpkin et al. (2005) pointed out worldwide production of fruit and vegetable crops has
grown faster than that of cereal crops. Between 1960 and 2000, the area under horticultural crops
worldwide has doubled. Among the main reason attributable to the growth, high return from
horticulture as compared to cereals was the prim one. Per capita farm income from horticulture
has been reported up to five times higher. Promotion of the production of, and trade in, fruit and
vegetables has become one of the key objectives of developing countries(IFAD.2003)
Strategy for sub-Saharan Africa focuses on enhancing the income of small holders within the
context of trade liberalization. Smallholder production and the marketing of fruits and vegetables
is a key focus (IFAD, 2003). Most fruits are perennial trees and can live more than fifty years.

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Apart from their economic importance, they are forest and environmentally friendly to fight
against drought, use as shade, fire wood, food security, agro industry, export, etc.

Ethiopia is agro-ecologically diverse and has a total area of 1.13 million square km. Many
parts of the country are suitable for growing temperate, sub-tropical or tropical fruits. For
example, substantial areas in the south and south-western parts of the country receive sufficient
rainfall to support fruits adapted to the respective climatic conditions. In addition, there are many
rivers and streams which could be used to grow various horticultural crops. Despite this
potential, however, production-market chain of fruits has remained immature in Ethiopia
(Joosten, 2007) mainly due to traditional focus which was in favor of cereals. Serious lack of
information and ‘on and off’ productions have also played their deterring role (Naamani,2007).
Realizing these gaps, lately however, the government of Ethiopia has launched enabling
environment to encourage chain actors. As a result, the Ministry of Agriculture has elevated the
horticulture sub-sector from a small section to a level of agency (World Bank, 2004; Joosten,
2007; Kahsay et al., 2008).

More than 47 thousand hectares of land is under fruit crops in Ethiopia. Bananas contributed
about 60.56% of the fruit crop area followed by Mangoes that contributed 12.61% of the area.
Nearly 3.5 million quintals of fruits was produced in the country. Bananas, papaya, mangoes and
orange took up 55.32%, 12.53%, 12.78% and 8.35% of the fruit production, respectively (CSA,
2009). However, less than 2 % of all the produce is exported (Joosten, 2007). These fruits are
typically cultivated to supplement household income from their main crops. The few state farms
with about 3,000 ha mainly grow tropical fruits (banana, avocado, mango, orange, and papaya)
and are mainly located in the eastern Rift Valley (Seifu, 2003). Apples are mainly grown in the
highlands of Chencha, in the south, and are expected to expand to other highland areas in the
country (Joosten, 2007).
Most of the fruits are produced in Ethiopia are consumed locally and are produced by small
holder farmers. After harvest they are transport to rural market centers for local consumers or are
bought at the farm by neighbors. Others are transported to bigger market centers where many
producers utilize the open-Air markets that are patronized occasionally, once or twice a week.
Limited post harvesting improvement is done for locally consumed fruits. However, fruit like

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banana, orange, lemon, pineapple and avocadoes exported to Europe and Middle East are graded
and packaged appropriately (Habte, 2001)

In Ethiopia, the existing income generating capacity of fruits as compared to its immense
potentials at the macro and micro level is not encouraging. Thus, from the total 3.5 million
quintals of fruits produced in Ethiopia, only less than 2% is exported (Joosten, 2007; MoARD,
2005). According to Yilma (2009), the production potential of fruits is not widely and evenly
distributed across the various regions of the country. The cultivation is also seasonal and the
supply is scanty and volatile even in areas where irrigation is possible. The knowledge gap on
fruit production techniques and processing technologies is wide. Also, knowledge of domestic
consumers of the benefits of fruits is confined to very few varieties of fruits. Hence, domestic
demand, with the exception of few widely known tropical fruits, is generally small and, various
studies show that people generally consume fruits and vegetables on a daily basis, without
considering them as basic. These factors have adversely affected the growth and expansion of the
fruit sub-sector in Ethiopia.

Additionally Bezabih and Hadera (2007) stated that a production of horticultural product is
seasonal and price is inversely related to supply. During the peak supply period, the prices
decline. The situation is worsened by the portability of the products and poor storage facilities.
Along the market channel, 25 percent of the product is spoiled.

Development needs of fruit in general poorly addressed in Ethiopia. But these days efforts have
been stepped up to improve and support the sector. With this line, the current Growth and
Transformation Plan of Ethiopia (GTP) prioritizes intensive production and commercialization of
horticulture as a sector for attention. Thus, the development policy initiates the need to accelerate
and lucid the transformation of the sub-sector from the subsistence to business and market-
oriented agriculture. But, the existing restraints of post-harvest and marketing infrastructures
such as: packaging, pre cooling, warehousing cold storage, pre-package and distribution have
played their deterring role on trade and consumption of fruits in Ethiopia (Seifu, 2003).

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According to World Bank Group (2006), lack of concerted public support, scanty information,
poor understanding of how the market chain works; and lack of systematic documented
knowledge are main threats that hampered the benefit of the sector. Thus comprehensive data
collection along the chain is a must envisage the direction of input-output flows (Tsegaye et al.,
2009). If these jeopardize are not well addressed right onwards, it is obvious the country’s
competitiveness would trail far behind the existing stage.

According to Sisay (2004) among the Ethiopian regions; Amhara and Tigary are the least fruit
and vegetable producer regions. For the past few decades most fruits are imported from other
regions of the country. Currently, the government has given due emphasis on irrigation; and
adoption of new agricultural technology as a result, the region has shown progress in fruit
production and farmers are trying to supply fruits to the market but their contribution is
insignificant in satisfying the existing fruit demand in the region. Due to the fact that the fruit
production in the region is very low, identifying those factors that impede fruits production,
productivity and market potentials in the region will enable to come up with valuable
information to policy makers and other stakeholders. To fill this gap, investigating the overall
potential of fruit production and marketing in the region is essential for further development of
the sector. Hence, the current research aimed to assess the opportunities and challenges of fruit
production and marketing in the region as well as its contribution for livelihood of the farmers.

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1.3 Objectives of the review
1.3.1 General objectives
The general objective of this paper is to Review the Constraints of fruit marketing in Ethiopia

1.3.2. Specific objectives

 To review factors affecting fruit supply in Ethiopia
 To review the organizations, linkages and lines of movements of fruit products and
production inputs;

1.4. Significance of the seminar

This review helps for those who are willing to raise issue as a direction indicator for their work.
The result of this review gives further information to those who need to study on constraint of
fruit marketing in Ethiopia. And it helps them to understand the major constraints of marketing
include lack of markets to absorb the production, low price for the products, large number of
middlemen in the marketing system, lack of marketing institutions safeguarding farmers' interest
and rights over their marketable produces (e.g. cooperatives), lack of coordination among
producers to increase their bargaining power, poor product handling and packaging, imperfect
pricing system, lack of transparency in market information system mainly in the export market.
Informal transaction prevails in the export system. Producers and local traders receive value for
their products only after the exported product is sold. There is a lack of standard for quality
control and hence lack of discriminatory pricing system that accounts for quality and grades of
the products.

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 1. LITERATURE REVIEW

2.1. Theoretical Review

2.1.1 fruit production

Fruit crops can be categorized as long term perennials (e.g mango, guava, date palm) and short-
term perennials (e.g papaya, banana, pineapple) while based on their plant nature, they are
categorized as woody/tree fruits (e.g mango, guava ) and non-woody fruits(e.g papaya, banana,
pineapple) they are also classified based on their climatic adaptability, which is mainly known as
ecological classification. Ethiopia endowed with diverse agro-ecologies and soil types has
favourable environment (especially low and mid-altitude areas) for successfully production of
various tropical fruits. Banana, mango, papaya, pineapple, guava are the major tropical fruits
crops widely grown in the country.

Many fruits can be produced in Ethiopia, as the climate, in particular in the highlands, is
favorable. They may be propagated directly from seeds or by vegetation means. In addition,
current investments in irrigation schemes will further contribute to the development potential.
The main fruit crop is the bananas, with 290,000 tons annually, followed by mango (70,000
tons), orange (49,000 tons), and papaya (43,000 tons). It is believed, however, that the potential
fruit base is considerably higher. Due to absence of markets postharvest handling facilities and
processing industries, a large part of the fruit may be left untouched or be sold for low prices
during harvest season.
In the urban areas, in particular in Addis Ababa, fruit can be observed insufficient quantities at
markets, but demand for fresh fruits is limited due to the fact that most consumers cannot afford
them. Except for bananas, fruit is consumed by middle and higher income classes, which
represent not more that 10% of the overall population.

Ethiopia has a variety of fruit crops grown in different agro ecological Zones by small farmers,
mainly as a source of income as well as food. The production of fruit varies from cultivating a
few plants in the backyards, for home consumption, to large-scale production for the domestic
and home markets. According to CSA (2009) the area under these crops (avocado, bananas,
guava, lemons, mangoes, oranges, papayas and pineapples) were estimated to be 47987 hectares.

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Ethiopia has diverse agro ecology and many areas are suitable for growing temperate, subtropical
or tropical fruits. Substantial areas receive sufficient rainfall and many lakes, rivers and streams
could also be used to support fruit production.
In Ethiopia, fruits are produced by smallholders and by some state-owned farms. According to
MOARD (2005), about 99% of the area allocated to horticulture production is cultivated by
smallholders, which produced 428,752 tons of fruits and 2,107,292 tons of vegetables. The total
share of smallholders' produce during 2003 was 97% of the national supply. It is reported that in
2004 about 45,0392ha of land was used for vegetable and fruit production which is 0.05% of the
total area under cultivation, while in 2003 the total production of vegetables and fruits was
24,526,712 qt. The production is concentrated in the lowland areas. Some of the respondents
grow 1-4 different types of fruit trees while others have none. Papaya is relatively widely grown
followed by mandarin, gishta and orange. Most of the households have few plants often grown
for consumption although a limited amount is also sold. The production is based on gardening
(for non-irrigated) and field level production under the irrigated system. About 52% of the fruit
producers use irrigation, mainly in the Dire Dawa area.

1.2 Emperical Review

2.2.1 Trends of fruit Production for Past

Production of fresh fruits has shown modest growth. The principal types of fruits for which
significant volumes are recorded are bananas, oranges and other citrus fruits (tangerines,
clementines, Satsuma, lemons, limes), mangoes, avocado, and papaya. In volume the domestic
production is dominated by papayas (31% in 2003), mangoes (22%), followed by avocado and
banana (11 % each).

Table 1. Fresh Fruits Production Trends, 1998-2003

Lemons &

Avocados
Mangoes
Harv(H)

Clement.
Bananas

Mand.&
Oranges

Papayas
Grapes
Fruits,

Limes
Tang.
Area

Total

1998 18,550 51,000 2,000 1,650 1,000 1,000 __ __ __

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1999 18,750 51,000 2,000 1,650 1,000 1,200 __ __ __

2000 48,919 51,000 2,000 1,650 1,000 1,550 10,200 9,754 9,865

2001 51,010 51,000 2,100 1,650 1,000 1,700 10.450 9,860 11,150

2002 51,550 51,000 2,100 1,700 1,000 1,750 10,600 10,000 11,300

2003 51,824 51.000 2,100 1,700 1,000 1,750 10,887 10,160 11,127

Source: FAO, 2004

2.2.2 Fruit consumption

The demand for fruit consumption is increasing. The trend will definitely continue to grow as the
awareness and purchasing power of the population is increasing. However, to meet the
increasing consumer demand for fresh produce, the production and the productivity of fruit crops
produced in various parts of Ethiopia need to be improved.

Consumers are those purchasing the products for consumption. Two types of consumers could be
recognized: private consumers and institutions. The private consumers are employees, urban and
rural dwellers who purchase and consume fruit products. The institutions include hospitals,
college and other institutions. Private consumers purchase fruit products directly from producers,
retailers and wholesalers. Cabbage; beetroots, carrots onions/shallot, potato and tomato are
purchased by most of the consumers. Regarding fruits, orange, banana and mango are purchased
by the largest number of consumers as compared to other type of fruits. The amount of
consumers purchased depends of how frequent they visit the market, their income level, and the
storage possibility/capacity of the household. The consumers purchase fruit two times on a week
and on average purchase 2kg per week. The differences among the consumers in terms of
frequency of purchasing are the quantities purchased. Those frequently visiting the market
purchase smaller quantities (as low as 0.25kg) and it depends on the types of products (Bezabih
et al., 2007).

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 Most of the fruits produced in Ethiopia are consumed locally and are produced by small holder
farmers. After harvest they are transport to rural market centers for local consumers or are
bought at the farm by neighbors. Others are transported to bigger market centers where many
producers utilize the open-Air markets that are patronized occasionally, once or twice a week
limited post harvesting improvement is done for locally consumed fruits and vegetables.
However, fruit like banana, orange, lemon, pineapple and avocadoes exported to Europe and
Middle East are graded and packaged appropriately (Habte, 2001)
 Consumption Compared to other African country; Fruit and vegetables are not common
items in the Ethiopian diet. In particular the fruit consumption, compared to other African
countries, is low (Table 2). Only one of every 5 Ethiopians eats fruits regularly. On average
the Ethiopian diet consists of 1.3 kg of fruit per person per year while that ranges from 11.9
to 39 kg in the other African countries. Although the price per kg of fruit in Ethiopia is one of
the highest in the researched African countries, the percentage of the food budget spent on
fruits is the lowest. In contrary to fruits, vegetables are more common in the Ethiopian diet.
However the quantity consumed per person is still one of the lowest compared to the other
countries even though price per kilogram in Ethiopia is the lowest of all countries.

Table 2. Summary of fruit consumption patterns

Fruit

Mozambique
consumption

Tanzania
Ethiopia

Burundi

Rwanda

Uganda
Malawi

Guinea
Kenya

Ghana

% consuming
20 50 45 23 72 57 46 22 62 75
Quantity
(kg/person/yr) 1.3 15.8 11.9 13.4 22.2 15.3 25.8 23.6 25.8 39
Value
(US$/person/y 0.4 3.1 2.8 1.6 3.4 4.6 5.9 2 8.3 8.2
r)
Price

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(US$/kg) 0.31 0.2 0.24 0.12 0.15 0.3 0.23 0.08 0.32 0.2
1
% of food
budget 0.4 1.8 1.9 1.3 2.5 4.2 1.9 1.3 2.1 3.8
% of total
budget 0.3 1.3 1.2 0.6 1.7 3.4 1.3 0.7 1.3 1.9
Source: Workafes, 2007

2.3 Fruit Marketing

2.3.1 General Fruit Marketing

The Ethiopian size of the domestic market for fruit is limited as is also clear from the very low
consumption data. Export of fruit and vegetables can be categorized into three types. First,
export of relatively high value perishable produce to Europe. Second, the export of low value
produce cultivated predominantly in Eastern Ethiopia around Dire Dawa, to regional markets
(mostly Djibouti) and, third, some processed and fresh produce to Middle East countries
(Greenhalgh and Havis, 2005).
The export of fresh fruit began to develop in the early 1970s. However, private sector efforts to
export to Europe and Middle Eastern countries were thwarted by the Derg regime, and exports
fell drastically after the 1974 revolution. Under the centrally planned economy of the Derg
regime, exports were dominated by state-owned farms. In the late 1980s exports began to grow
again, but failed to achieve levels reached prior to 1974. Since the collapse of the Derg regime in
1991, private sector operations have slowly entered the market. The Mengistu regime
encouraged fruit and vegetable production. Fresh fruits, including citrus and bananas, as well as
fresh and frozen vegetables, became important export items, but their profitability was marginal.
The Ethiopian Fruit and Vegetable Marketing Enterprise (EFVME), which handled about 75
percent of Ethiopia's exports of fruits and vegetables in l984-85, had to receive government
subsidies because of losses (F&V Ethiopia, 1991).
Etfruit was the first state company to market to countries of the E.U. In the nation's capital,
Addis Ababa, Etfruit has three main branches, twenty-one retail handling shops and thirty mobile
shops strategically placed to render efficient service. The types of fruits delivered to domestic

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markets are oranges, mandarin, grapefruit, lemon, lime, mango, avocado, guava, banana,
processed horticulture products such as tomato juice, orange marmalade, orange squash, and
grapefruit squash and guava nectar. The major suppliers of fresh fruits and processed products
are the Upper Awash Agro-Industry Enterprise the Horticulture Development Enterprise and
Metehara Sugar Factory (Ethiopian Fruit & Vegetable Marketing Enterprise website, as on Jan
24, 2007)
2.3.2 Domestic market

The size of the domestic market for fruit is very limited and not diverse. Fruits are hardly found
at all and within the group of vegetables mostly potatoes, onions and tomatoes are sold. Fruits
are transported to the local market by local transport, carts and donkeys. Regular trucks are used
for transportation to Addis.
Main fruit markets in Addis Ababa are Piazza, Mercato and Mesalumia Fahil berenda. These
markets have all kind of clients; wholesalers, retailers and consumers are sourcing their fruit at
these markets. Approximately 50% of the supply originates from smallholder producers or
farmers’ cooperatives. Piazza and Mercato sell mostly vegetables and only a limited range of
fruits (some banana and papaya). Some traders have their own shop and storage place. A lot of
traders are selling their produce at the messy pathways of the market. Produce comes from all
over the country, but mostly from the Rift valley. Fruit and vegetables are also sold at some
supermarkets in Addis Ababa but to a very limited extent. The most modern supermarket, Bambi
Supermarket, sells little vegetables but in a wide range. Availability of fruits is low, mostly
apples are offered. The fruit juices at the shelves are all imported from countries as South Africa
and the USA.

2.3.3 Foreign market of fruit

According to Sisay (2006), in 2002 alone about 36 countries imported Ethiopian fruits and
vegetables. About 74% of the quantity exported was imported by Djibouti. The revenue
generated from the export was Birr 11,279,211 of which 59.529% was received from the export
to Djibouti. Other major importers were Sudan (5.2% of the volume and 6.6% of the value),
Yemen (3.8% of the volume and 3.7% of the value), India (2.3% of the volume and 2.01% of the
value), Netherlands (1.6% of the volume and 9% of the value), Italy (1.8% of the volume and

11
4.8% of the value), etc. About 80% of the horticulture export was made through Dire Dawa. The
Djibouti market is an important outlet for fruits and vegetables produced in the eastern, central
and southern regions of Ethiopia.

According to Sisay (2004), there are 10 types of vegetables and 10 types of fruits Ethiopia is
exporting to Djibouti market. The major vegetables exported through this route are potatoes,
onion, and tomatoes while the fruits are dominantly orange, banana, mango and mandarin.
Smallholder farmers supply vegetables, mango and banana fruits while the state farms supply
orange, mandarin and lemon. Some farmers who are using irrigation for production around Dire
Dawa also supply fruits for the export market, through exporters.

The existence of railways, road transport and flights to Djibouti and Somali land has given
comparatives advantage for the vegetables and fruit marketing. Exporters label the sacks which
are distributed to the supplying traders. No price negotiation is made up on receiving the sacks
but up on submission of the product. The price of the product is determined based on the
previous market but payment is affected only after the production is sold in Djibouti. Prices for
fresh fruits and vegetables exported to Djibouti are fixed based on the agreement between the
governments of two countries and the prices were determined based on cost and freight terms
where transportation cost to Djibouti is covered by the exporters (Sisay, 2004).

2.4 Constraint of fruit marketing

2.4.1 Markets and Market Access

Information about export markets is currently limited. In order to export successfully there are a
number of key requirements relating to markets, market evaluation, promotion, and quality
management that must be addressed. There is a need to undertake market studies to determine
the range of products in demand in the target markets; issues to be addressed include volumes,
varieties, seasonality, quality requirements, and most importantly competitiveness of Ethiopia.
Without continued access to relevant market information it will be very difficult for Ethiopia to
compete. As the dominant exporter, Ethiohortishare has been responsible for market
development and provision of information to the farms – but a major criticism of this enterprise

12
has been its failure to feed market information back to growers (Anonymous, 2003). EHPEA
recognizes the need to collect market information.

The major constraints of marketing include lack of markets to absorb the production, low price
for the products, large number of middlemen in the marketing system, lack of marketing
institutions safeguarding farmers' interest and rights over their marketable produces (e.g.
cooperatives), lack of coordination among producers to increase their bargaining power, poor
product handling and packaging, imperfect pricing system, lack of transparency in market
information system mainly in the export market. Informal transaction prevails in the export
system. Producers and local traders receive value for their products only after the exported
product is sold. There is a lack of standard for quality control and hence lack of discriminatory
pricing system that accounts for quality and grades of the products.
 Marketing constraints faced by the traders: The major problem for many of the
wholesalers is transportation to bring the fruits to the market. According to them to bring the
fruits from the field to the market it takes 4 to 5 days. Some times when the trucks are delaying
due to different reasons, except banana, all other types of fruits have the probability of either
wilting or perish. In addition to this, price variability also yet another problem of the traders.
From the peak period till the end of the harvest, price variation takes place two to three times.
Moreover few wholesalers also faced a problem of cheating in the order, since most of the
agreement and financial transaction have been made through phone and banks. In rare cases if
trucks are broken before reaching the destination, the ordered fruit will be sold to other traders
by the farmers.

2.4.2 Lack of skilled labor resources and technical know-how

While Ethiopia is over-supplied with low-cost unskilled labor, there is a lack of skilled
manpower with managerial abilities and in-depth horticultural knowledge. Several horticultural
companies see this as a major constraint to production, and cut flower producers have gone as far
as using expatriate labor to alleviate these difficulties. Further, the sub-sector lags behind that of
most producing countries in its agronomic practices. In part, this is because both state farms and
private sector operations do not have the capital to pay for the technology and expertise required.

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Further, there has been very little formal research to overcome problems of low genetic potential,
an absence of quality selection to overcome the lack of high-yielding and high-quality cultivars,
inappropriate disease and insect pest control measures, and a lack of quality seed supply.
the supply chain, including knowledge of production planning, post harvesting handling and
processing practices. Low-level technology, knowledge of specifications and codes of practice,
knowledge of markets and marketing and lack of promotion activities are additional limitations
(Anonymous, 2003).
 Production quality constraints: The major fruit production constraints include pests,
drought, shortage of fertilizer, and price of fuel for pumping water for irrigation. Lack of
desired seed variety was also stated. The opportunities for increasing horticulture production
include the increase in market integration, the need for intensive production in response to
increasing population pressure, farmers' awareness of the benefits, the current outreach
program in relation to supportive government policy, attempts made in water harvesting, etc.

The constraints of fruit production quality could be viewed from the farmers’ context,
institutional factors, natural factors and infrastructure related factors.
1. FAMER RELATED : fruit production is based on tradition, which is poorly supported by
scientific recommendations. Although one can associate this constraint to institutional factors, it
is apparent that inadequate farmer skills and knowledge of production and product management
affects the supply. Farmers attempt to select varieties and practice traditional crop management
practices. Farmers’ know-how of product sorting, grading, packing and transporting is
traditional, which severely affects the quality of fruit products supplied to the market. This skill
gap should be addressed to improve the quality of marketable fruit products.
2. INSTITUTIONAL FACTOR : are related to the provision of improved fruit production
technologies including supply of relevant varieties, agronomic practices and improved product
management techniques.
3. NATURAL FACTORS : such as rainfall, water supply, flood and pests are often beyond the
control of farmers and institutions. There is a shortage of irrigation water mainly in the lowland
areas. Yet, contingency planning and forecasting of the events which may help to minimize the
effect is not available perhaps due to traditional ways of production. Moreover, an appropriate
management system including variety selection and diversification would reduce the effect of
natural factors. Improving the institutional constraints discussed above will be instrumental for
improving the management system.

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4. INFRASTRUCTURE : such as rural roads and means of communication for efficient flow of
goods and market information is a limiting factor. Most of the rural area is not accessible by
vehicle. The products are transported to the road side by donkeys or by people. This requires
longer time to reach the market and affects the quality of the products. Moreover, there is no
telephone or other fast communication systems to access market information that would assist
decision making.

2.5 Opportunities for increased fruit marketing

Fruit marketing has increasing opportunities for expansion. The opportunities stem from the
production potential. These include:
 Farmers may be motivated to expand fruit production by using traditional irrigation and
using improved agricultural inputs;
 NGOs could have been involved in the promotion of the poor, particularly women, in fruit
production;
 The government encourages private sector development which is instrumental for the
commercial activities. The government also supports smallholders' market integration
through the production of marketable agricultural commodities. The current government’s
Plan for Accelerated and Sustainable Development to End Poverty (PASDEP) sets
intensification and commercialization of agriculture as a development path during the next
five years. Provision of improved agricultural technologies, provision of extension packages
and farmers' capacity building, etc. are major areas of support the government has planned to
provide farmers. There are opportunities for expansion of fruit production in the areas of
Increase in price of the product, Relatively high demand in the market, Possibility of using
improved inputs and rent land, Having a pumping machine, Government support, Increased
production skills, Availability of nearby water, Land suitability and Labor availability.

3. CONCLUSIONS AND RECOMMENDATION

3.1 Conclusions

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Given the large potential for fruit production in the country, their contribution to the total GDP
has been extremely low for many reasons. The most cited reasons include lack of market
oriented production which is too traditional and poorly supported by scientific recommendations,
excessive margin mainly due to inefficient and costly transport, absence of fruit market
information, inadequate government interventions and absence of market regulations and
legislations and its marketing activity is principally attributed to poor actors skill. The major fruit
marketing constraints identified in Ethiopia are, low price to the producers, lack of transportation
and road facility, and perishability nature of the product. Producers are in a disadvantageous
position in terms of the price that they generate from fruit production i.e. even though the price
of fruit is increasing from time to time; producer’s margin is decreasing because most decision of
marketing is done by the existing demand and supply. In addition due to lack of storage and
processing facility, the fruit producers do not get the potential income from the fruit production.
The perishable nature of the product also limits the marketability of the product and constraint
expansion of fruit in the Ethiopia. As a result, fruit marketing needs due attention in any on-
going or future fruit development plan.
Although comparative rewards such as: suitable agro-ecology, proximity to national market and
cheap provision of labor are opportunities, but declining prices, poor market integration, absence
of improved technologies and provision of extension packages are major factors.

3.2 Recommendation

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The market improvements revolve around institutional, legal frames, education, developing
market facilities. The following concrete recommendations will improve the marketing system
and enable fair and equitable distribution of the welfare generated from the marketing system:

 Establish and enforce a legal system in the marketing management. Defining quality
parameters, standards, grades and putting regulatory frameworks to enforce pricing based on
standards is important.
 Organize (voluntarily) traders and producers and establish trustful and strong trade
agreements between the two institutions. Attempts to organize the traders and producers
without establishing a linkage between the two have resulted in rival relationships between
them. Neither the traders nor the producers succeeded. There is a strong need to organize
them as business associations and build their business management capacities to operate as
partners rather than rivals, i.e. both should be in a win-win position.
 Improvement of the market information delivery system in this process is necessary.
 With a strong relationship between traders and producers, searching for market Information
and dissemination will be crucial.
 The Government must adopt legal measures to review the fruit export prices to Djibouti and
other countries.
 The informal business deal between the suppliers and exporters also needs adequate
attention. There is no collateral system, fixed and binding price agreement, etc. made
between the exporters and the suppliers. The consequence of such a deal is a reduced price
for the producers.
 Improving the marketing functions such as the packaging, storage and transportation system
should be improved.
 In order to fully understand the fruit marketing system, undertaking fruit marketing study in
the neighboring countries is essential.
 Interventions which will improve local demand for fruit products are also necessary. In this
regard, education on the nutritional value of fruits, home economics and promoting
consumption of fruit products would help.
 And also improving the fruit production system because production quality is major
constraint for marketing activities

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 Improve the input supply system so that farmers receive the right type of production inputs,
the quantity needed at the right time. Improving the system will protect farmers from buying
adulterated and fraudulent products.
 There is a lack of qualified, skilled and experienced individuals on the subject at the lower
hierarchy of the rural and agricultural development office. Knowledge and skill in variety
selection, agronomic practices and post harvest management should be further built on.
 Improvement of the market information delivery system in this process is necessary. With a
strong relationship between traders and producers, searching for market Information and
dissemination will be crucial.

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4. REFERENCE
1. Anonymous, 2001. Information for Agricultural Development in ACP Countries.
CTA, pp.96.
2. Anonymous, April 2003, ETHIOPIA: Trade and Transformation Challenges, Annex 8,
3. Agriculture and trade, diagnostic trade integration study.
4. Bezabih Emana and Hadera Gebremedhin, 2007. Constraints and Opportunities of
Horticulture Production and Marketing in Eastern Ethiopia DCG Report No. 46.
5. CSA (Central Statistical Authority), 2009. Area and Production of Major Crops.
Sample Enumeration Survey. Addis Ababa, Ethiopia.
6. Ethiopian Fruit & Vegetable Marketing Enterprise website, as on Jan 24, 2007
7. FAO. 2003. The Market for Non Traditional Agricultural Exports Commodities and
Trade Division, Food and Agriculture Organization. Rome.
8. F&V in Ethiopia - Data as of 1991 - http://lcweb2.loc.gov/cgi
bin/query/r?frd/cstdy:@field (DOCID+et0105)
9. Greenhalgh P. and Havis E., Natural Resources Institute, March 2005, Feasibility
Study on Assistance to the Export Horticulture Sector in Ethiopia, United Kingdom
10. Lumpkin, T.A., K., Weinberger and S. Moore, 2005. Increasing Income through
Fruits and Vegetable Production: Opportunities and Challenges. Marrakech,
Morocco. 10p.
11. IFAD (International Fund for Agricultural Development), 2003. Promoting Market
Access for the Rural Poor in Order to Achieve the Millennium Development Goals.
Discussion Paper for the Twenty-Fifth Anniversary Session of IFAD’s Governing
Council. Rome, Italy.
12. Joonsten, F., 2007. Development Strategy for Export Oriented Horticulture in
Ethiopia.
13. Kahsay Berhe, Yigzaw Dessalegn, Yisheak Baredo, Worku Teka, Hoestra, Dirk; and
Azage Tegegne, 2008. Smallholder Based Fruit Seedling Supply System for
Sustainable Fruit Production in Ethiopia: Lessons from IPMS Experience, ILRI.
Addis Ababa, Ethiopia.

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14. MoARD (Ministry of Agriculture and Rural Development). 2005. Vegetables and
Fruits Production and Marketing Plan (Amharic Version), Ministry of Agriculture
and Rural Development, Addis Ababa, Ethiopia.
15. Naamani, G., 2007. Developments in the Avocado World. California Avocado
Society 2007:71-76, Tel-Aviv, Israel.
16. Seifu Gebremariam, 2003. Status of Commercial Fruit Production in Ethiopia, Addis
Ababa,Ethiopia.
17. Sisay H (2004) Fresh Fruit and Vegetables: Production and Market Study. Ethiopian
Export Promotion Agency. Product Development Market Research Directorate
Ethiopia.
18. World Bank, 2004. Poverty Reduction and Economic Management, Country
Department for Ethiopia: Opportunities and Challenges for Developing High-value
Agricultural exports in Ethiopia, Africa region, background report, April 9, 2004
http://sistersouces.worldbank.org/in/ethiopia/resourecs/prem/opp/and/challenges/
high/va ue/exoprts.pdf Accessed on 03rdApril, 2004.
19. World Bank Group, 2006. Ethiopia: Developing Competitive Value Chain
http:/siteresources.Worldbank.org/INTAFRSUMAFTPS/resources?aftpsnote29F0610
17.pdf Accessed on 17th, December. 2009.
20. Yeshitela, TB. And T. Nessel, 2004. Characterization and Classification of Mango
Ecotypes Grown in Eastern Hararghe (Ethiopia). Sarhad Journal of Agriculture,
19(2): 179-180.
21. Yilma Tewodrose, 2009. United Nations Conference on Trade and Development.

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The major constraints of fruit marketing include lack of markets to absorb the
production, low price for the product , large numbers of middle men and marketing
system, lack of marketing institutions safeguarding farmers interest and right over
there marketable produces e.g cooperative, lack of coordination among producers to
increase their bargaining power, poor products handling and packaging, imperfect t
pricing system, lack of transparency in market information system mainly in export
market.

Informal transaction provides in the export system.pruders and local traders receive value for
their products only after the export product is sold.There is a lack of standard for quality control
and hence lack of discriminatory pricing system that accounts for quality and grades for the
products. Marketing constraints : the major problem for many of the wholesaler is
transportation to bring the fruit to the market. According to them to bring the fruits from the field
to the market it takes 4 to 5 day. Sometimes when the tracks are delaying due to different
reasons, except banana, all other types of fruits have the probability of either wilting or perish.

In addition to this, price variability also yet another problem of the traders. From the peak
period till the end of the harvest, price variation takes place 2 to 3 times. Moreover few
wholesaler also faced a problem of cheating in the order, since most of the agreement and
financial transactions have been made through phone and banks. In rare case if tracks are
broken before reaching the destination, the ordered fruit will be sold to other traders by the
famers.

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