Analysis of willingness to pay for community based potato cold storage facilities. A case of small scale producers in Nakuru County

Abstract

Potatoes are crops that although perishable can be stored easily with minimum loss of quality and quantity. Potato storage in Kenya is not common with the few farmers that practice it doing it traditionally and are therefore exposed to risks and consequently losses. Studies have indicated that the storage of potatoes is a means of protecting farmers from seasonality in supply and price fluctuations constraints. Studies in Tunisia, India, and USA have shown the benefits of potato storage but little has been documented on the willingness of farmers in Kenya to use or pay for specialised potato storage facilities. This study looked into the willingness of farmers to pay for the services offered at these centres as well as elicited the amount they would be willing to pay for the storage. The study used cross sectional data that was collected using predesigned interview schedules. A sample of 207 farmers was used in the study and it was obtained using the multi-stage sampling. The data was analysed and summarised using Excel, Stata and SPSS. Potato farmers in the county were characterised using descriptive analysis. The amount of money the farmers were willing to pay as storage cost was elicited using the Double Bounded Dichotomous Choice Model with the underlying distribution being a probit model. The empirical results indicated that age, education level, role of agriculture to the household, farm size and distance from the main road, access to market information and access to agricultural extension were significant factors at 0.05 confidence level. All of these factors had a positive influence on willingness to pay except age which had a negative influence. The results of the study also indicated that the amount farmers were willing to pay is higher than what the actual fee is. This therefore indicates that the Community based storage facilities are viable investments and can be used in achieving the vision 2030 which aims at increasing income from farming through innovative, commercially oriented and modern agriculture. The study recommends that a pilot cold storage facility be set up to so as to make the farmers fully understand the potential and benefits of potato cold storage technology. There is need for more consultation on the most optimum cost of storage facilities so as to influence the farmers in the region to use warehouse storage facilities.