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This study aimed to explore the oil palm products marketing value chain in Kigoma region, the
study was guided by the following specific objectives: to identify the oil palm products value
chain activities and the rate of use of each product, to identify key factors that influence market
pricing of oil palm products, to identify cost and profit Margin of each oil palm product; to
determine Marketing Chain of Oil palm products and to identify constraints facing oil Palm
products chain actors.
The study adopted both quantitative and qualitative research approach, where by both interview
and questionnaires were used. A sample of 590 respondents was used, data were analyzed using
descriptive statistics and content analysis, and the data were presented by frequency tables and
percentages.
The study found that Soap is the product that is used often followed by palm oil and palm kernel
oil while palm wine is the product that is not often used and many respondents have never used
it. Also the findings revealed that the factors that influence pricing for farmers are only
production cost and the weather. Trader’s pricing is affected by transportation cost, weather and
storage cost. Palm kernel oil Processors and soap Makers pricing is determined by weather,
production costs, storage cost, transportation cost and cost of raw materials. The cost profit
analysis shows that all chain actors make profits except farmers who are the disadvantaged chain
actors in the marketing value chain because they obtain a loss of Tshs 7,300 for every 25Litres of
palm oil sold.
The study also found out that the oil palm products marketing value chain in Kigoma region for
all the four products studied is the traditional marketing system whereby push marketing strategy
is used and there is little or no interaction between value chain actors.
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Inadequate capital and poor market of the produced products are the challenges that faced all
chain actors where by challenges that faces farmers only are traders and agent’s behavior, poor
government support and poor technology. Soap makers, traders and palm kernel oil processors
are faced with challenges such as transport, poor entrepreneurial knowledge and high taxes and
tariffs.
The study recommends that the Ministry of Education and vocation training in collaboration with
the Ministry of Food and Agricultural Cooperatives should develop of oil palm research centre in
the country so as to ensure that the seeds used are modified to increase oil palm production.
Ministry of industrial trade and marketing should facilitate the construction of modern industries
of processing palm oil and provide proper government support in the oil palm sector including
farming for energy and provision of training to value chain actors. Finally chain actors should
adopt the value chain marketing system so as to ensure suitable development of the oil palm
sector. |
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