Institutional Factors Influencing Diary Farmers Participation in Formal and Informal Milk Markets in Maseru Urban, Lesotho, South Africa

Abstract

The study was undertaken with the purpose of investigating institutional factors influencing participation in milk markets in Maseru urban. Out of 30 dairy farmers, 30 were selected using a survey method and data was collected using a structured questionnaires. The data generated was analysed using both descriptive statistics and logit model. Descriptive results show that dairy farmers use formal market channels more than informal market channels. Empirical results show that market information, membership in organization and collective action, government support and contractual agreements influence participation in formal markets while social capital, path dependency, delayed payments and distance to milk collection centres influence participation in the informal markets.