Determinants of export performance of maize farmer organizations in Busia District, Uganda

Abstract

Export performance by farmer groups particularly in Busia district, Uganda has been hampered because they lack direct and legitimate access to export markets, Kenya in particular. The problem is further exacerbated by members’ preference to sell through illegal channels because the organizations lack the capacity to facilitate this trade. The study therefore sought to gain insights into the contributions made by the farmer organizations to maize traded and the determinants of their export volumes to the main market. The paper was steered by the subsequent objectives which were: To establish the effect of farmer group capacity on the export performance of maize farmer groups in Busia district Uganda; To demonstrate the effect of middlemen on the export performance of maize farmer groups in Busia district, Uganda; To illustrate the effect of infrastructural development on the export performance of maize farmer groups in Busia district, Uganda; To establish the effect of import bans and tariffs on the export performance of maize farmer organizations in Busia district, Uganda. Guiding the study were two theories, the first being the Resource-Based View Theory (RBV) in which institutions are required to identify their competitive advantages and leverage those resources to contribute to novel growth opportunities. The paper was also guided by the Contingency Theory in which firms are required to analyze the environments in which they operate and respond with appropriate contingencies that benefit the growth or existence of the firm. The study focused on garnering responses from 201 respondents in maize farmer organizations in Busia district from the 67 registered and active farmer groups in the district. The cross-sectional survey design chosen was executed with structured questionnaires as the primary tools of data collection. The study made use of a census sampling technique and one of the limitations experienced was the unavailability of some respondents. The study used the quantitative approach and regression analysis to probe how much these factors determine the export performance of maize farmer organizations in Busia district. The outcomes showed that infrastructural development had the most significant positive impact on export performance followed by the effects of import bans and tariffs from importing countries while farmer group capacity and middlemen had minimal impact on export performance. The results suggest that improvement of infrastructural development and an improved trade environment particularly between Kenya and Uganda could significantly contribute to the growth and development of maize farmer organizations in Busia district, Uganda. The study contributed to the provision of insights into the inner workings of maize farmer organizations and enlightened policy makers, local government officials and educators on the kind of support required by maize farmer organizations in order for them to thrive in their exports. The study further identified areas for further investigation like exploration of technological advancements in improving the export performance of maize farmer organizations. The limitations of the study included; unavailability of some respondents, inaccessibility of some information, remoteness of some study areas.

Keywords: Export performance, middlemen, farmer organization capacity, infrastructure, import bans and tariffs