Market Structure Conduct and Performance of Live Cattle in Borana Pastoral area: The Case of Moyalle District, Oromiya Regional State

The Borana Pastoralists are known as major cattle supplier of cattle for domestic and international markets, yet the benefits they get from the sector is said to be minimal. This study, therefore, was initiated to identify market chain actors and their function in the market, investigate the structure Conduct and performance of live cattle in Moyalle District of Borana Zone. Both primary and secondary data were used for this study. Primary data were collected from 223 sampled pastoralists, 25 traders and 14 brokers. Before the household survey, key informant interview and focus group discussions were conducted using 10 producers, 5 traders and 3 brokers. Descriptive Statistics and qualitative data analysis techniques were employed to analyze the cattle market structure, conduct and performance. The result shows that producers, brokers, traders and consumers were the major cattle market actors. Two major channels identified in the area were formal and informal. Both the channels are also characterized by their sub-channels. Among the formal channels, formal market channel is identified as the preferable marketing channel with better total final price share for producers. Regarding the market structure, cattle market is known to be dominated by few traders. Although the degree of competition varies, cattle market structure varies across cattle type marketed from loose oligopoly to strict oligopoly. This shows that only few traders share the majority of market share and earn abnormal profit. Besides, cattle market is characterized by entry barriers such as distant market point, high trucking cost, seasonality of marketing, information asymmetries and unfriendly relation between actors. These imperfect nature of the market in the district provoked informal trade. As the pastoralists mainly depend on cattle for their livelihoods and other cultural values, traders take advantage of the asymmetric market information towards them. Although it varies with the type of cattle, the larger share of the market gains remains with end of traders thereby limiting the pastoralists a chance to realize the economic gains in cattle production. Hence, linking producers to market and its benefits, establishing in cooperatives and development of infrastructure could play a significant role for optimization of the sector productivity.

exploitation of brokers, weak and unfriendly linkage in between the major marketing actors, lack of market-oriented cattle production is some of the main challenges.
To improve the competitiveness of cattle in pastoralist area cost-effective marketing channels and coordinated market chains, which reduce the transaction costs among different actors along the chain are crucial [3]. Majority of cattle marketing information in the pastoralist level is outdated, unreliable and as the result it couldn't able to provide the real picture of the economic contribution of pastoralists sector for the country economy and the community engaged in the sector. More over these, the critical problem in cattle marketing sector stands in the course of formulating appropriate policies and procedures for the purpose of increasing marketing efficiency in the sector. For the pastoralists' community undertaking research on structure conduct and performance of cattle is believed to enhance its productivity by locating economical cattle marketing routes. Available evidence shows that limited numbers of investigations have been made on local and regional cattle markets in pastoralist area and the market chain is dominated by many brokers at primary, secondary and terminal markets [4].
Most studies of market chain tend to focus on market chain of the cattle at aggregate level than dealing the market chain of individual cattle types. The present studies try to link this gap by disaggregating the cattle into various types to see the market chain opportunities and problems for each type of cattle separately. Therefore, this study will provide relevant information with respect to the value chain of various cattle types by a) Identifying the major market actors and their function of cattle market, b) Identifying the marketing channels, c) Examining the market structure, conduct and performance.

Methodology
The Borana administrative zone is situated in Ethiopia's Oromia regional state and located in Southern part at about 570 km (Yabalo town) from Addis Ababa. The capital of Borana zone is Yabello [5].
The Borana zone is made up of 13 districts, divided between two agro-ecological zones, the semi-arid lowlands to the south and the more humid lands at higher altitudes to the north [6]. Moyale is one of the Woredas in the Oromia regional state. It is located 770 km south of Addis Ababa. The Woreda has an area of 14,810 km2 and it is divided into 18 kebele 2 of which are located in Moyale town [7].
It splits the two countries: the larger portion being in Ethiopia (in the Oromia Region and Somalia region) and the smaller in Kenya (i.e. the capital of the Moyale district). It is a busy market for both informal and formal trade of food commodities and livestock [8]. In this study both secondary and primary data was used from different sources. Journals, books, proceedings, CSA and ESAP publications were secondary data sources that used in the study. Primary data sources include Pastoral household interview, traders' interview, brokers interview and key informant interview.
The study used commodity chain analysis (CCA), which involves mapping the market chains, involved in particular production sectors, different types of activity, geographical location and actors in different roles at different levels. The major market costs considered in the study include, cost transporting, brokering cost, marketing levies and taxes imposed by local authorities [9]

Socio-Economic Characteristics of Pastoralists
The average age of the Pastoralists household head was 42.
However, it ranges in between 20 and 81. The majority of them (96.9%) are in economically active age group in the age range of 20 and 65 years. The family size distribution Table 1 shows that the average family size of Moyalle pastoralists is 7 but it ranges between 2 and 25. The majority of the households have medium and large family size. Those households with very large family size are characterized by polygamous family. The small family size households were young couples. Table 2 revealed that 81.2 percent of sampled households did not attend formal education whereas; the proportion of pastoralist household who attended formal education was 18.8%. The distribution of pastoralist households with respect to formal education attendance shows that less than one fifth they attended formal education. However, study by [11] in Yabello district shows that the proportion of pastoralists who attended formal education is by far greater (41.7 %).  Unlike the pastoralist's category, the proportion of the traders who attended formal education is nearly two third (64%). This means that about 36% cattle traders were illiterate, 20% attended primary school (grade 1 to 4) and 36% attended junior school (grade 5 to 8) and 8% attended secondary high school (grade 9 up to 10) respectively. This implies that in cattle trading, the importance of education cannot be over-emphasized, for it determines information dissemination and technology adoption among marketers in diverse socio-economic and biophysical environment [13]. Contrary to their education profile, the majority of the traders (52 percent) were with trading experience of less than five years.
This reveals due to the infrastructure and development of policy that is relevant to cattle trade, currently attracting more traders.
The study results (Tables 3 & 4) observed confirmed also that the mean trading experience for sampled traders in the area was 7.64 years. The general trading experience of interviewed traders ranges between 2 to 20 years. The percent of cattle marketers that had marketing experience ranging from 2 to 5 years, 6 to 9 years and 10 to 13 were 52%, 12% and 16% respectively. The proportion of cattle marketers that had marketing experience of 14 to 17 years and 18 to 20 were 12% and 8% respectively. Hence, the results revealed that majority of cattle traders in the area are highly experienced.    Channel IV: Pastoralist-Brokers-formal Exporter. In this channel the producers sell cattle to brokers and brokers sell cattle to formal exporters and experienced by 2% of pastoralists. This cattle market chain was also identified as newly introduced chain to the area. This sort of market chain should be appreciated and have to be due attention to boost production and productivity of cattle [15]. Here, producers undertake cattle marketing through broker mediating process to other formal exporters and consumers.
Ethiopian universities and air lines institutions that come seldom to the area are some listed formal cattle buyers. brokers resell the cattle to butchers. this is also referred as newly developed cattle market channel that created in recent years as new market opportunities due to mobilization of peoples to the surrounding and smuggling activity that become job opportunities for majorities. This result tells about how the cattle market chain complicated by lengthy routes that hinder not to exploit the resource at pastoralists district by producers and tilted the market toward informal trade. This study calls for systematic intervention for cutting off unnecessary market route and adopting legalized market channel toward the vicinity African countries. As indicated in the (Table 5) above (5) the market structure shows distinctive features according to cattle type marketed. Market structure for oxen, heifers and calves trade is tight oligopoly but it is a loose oligopoly for cows and bulls trade. Since heifers and calves are often marketed among pastoralists and rarely by informal traders and not by formal traders, the market structure is tight oligopoly.  trek/truck the bulls. Consequently, traders in the area undertake marketing activity having been closely creating market relation so as to exploit benefits that belongs to producers. In addition to these, bulls trade encompasses various market actors such as informal traders, formal traders, hotels and restaurants and festival consumers, the market structure is relatively loose oligopoly.
The cow trade is also including various market actors such as pastoralists and informal exporters; its market structure is loose oligopoly. This point out that tight oligopoly reduces competition and the entire market remains a "few traders game" where created wealth does not flow to all the beneficiaries in equitable ratio.
Arguably, it should again be noted that failure to enjoy such benefits may distort market operations and eventually lead to collapse of the cattle production system. This calls for systematic government intervention in the sectors that could mitigate imbalance of trade benefits and help to optimize productivity through market linkage formation, adoption of value addition and development, update market information provision and cooperative formation.

c) Entry and Exit Conditions in the Cattle Market
The long market distance from pastoral areas to central towns of Ethiopia and the related high trucking cost, high capital demand, institution-based marketing and information asymmetries are some of the major entrance and exit barriers in cattle trade in the area. The number of cattle supplied to market in holidays, religious festivals and weeding occasions are also higher than that of other seasons. In order to undertake marketing activity directly; it is must to speak local language. So as to take part in cattle trade, it is also must secure large amount capital for purchasing cattle, trucking and trekking.

Market Conduct
Market Conduct refers to the strategies adopted by a player as a way of adjusting to the market conditions in order to fully enjoy the market benefits. Notably, it includes mechanisms such as price setting and terms of payment.

a) Price Setting Mechanisms
The price setting activity of cattle in pastoralist area is known to be accomplished by various actors in the market. About 62% of pastoralists confirmed that price of cattle is set by brokers based on initial price given by sellers and final price from buyers. The proportion of pastoralists recognized determination of price by buyers based on central market information, by brokers based on central area information and sellers by their own respectively is 22%, 10% and 6%. This shows that market actors had different level of influence in the role they played for setting price. It is observed that every aspect of price setting mechanism majorly is controlled by traders. This means that price setting in cattle market is often skewed toward traders and brokers. The result indicates that traders undertake non-price competitions including cattle type, trade experience, personality, financial capacity and language.
The implications of this market structure are few potential traders' accounts for large market share, market dominance by these top four traders, interdependency and collusion possible.

b) Terms of Payment for Producers
Both the household survey and key informant interview In general, producer's share of final price in formal channel higher than that of informal, which points out that formal route is preferable for them. Since traders and brokers obtain relatively better market margin in informal route, it is difficult to compete for formal traders with informal traders in the district. In contrary to free market economy, market concentration ration and market margin estimated for cattle market shows oligopolistic nature. It therefore means that the formal or informal market cattle traders do not bare full cost involved in the market thereby leading relatively low marginal costs. This is to mean that the cattle market is disintegrated in such a manner that price levels does not relay from the cattle keepers to the terminal market traders. Indeed, it is observed that the principle of free market through bargaining is distorted once a new market entrant is discovered. For example, buying at a relatively fair price requires one to have known the local language at the farm gate market, security and cattle type marketed (non-price competition).
This means that without close relation with the market brokers; one is subjected to price discrimination. Since the market is flooded by brokers at all the chain terminals; it is very difficult to assess the efficient market price and general information. It was observed that there exists larger number of market brokers both for different live cattle and in many cases; the brokers hold much needed information so as maximize on the commissions. Monopoly market structure violates the principle of equity between the traders and the pastoralists. This is because the larger share of the market gains remains with end of chain traders thereby denying pastoralists a chance to realize the economic gains in cattle production.

Comparison of Market Margin Across Cattle Type and Marketing Channels
The market performance of cattle marketed varies across cattle type marketed and the type of channel used. The empirical result in Tables 2 & 6 indicates that the cow traders earn highest net market margin but, calve traders earn lowest net market margin in formal channel. The level of net market margin earned in informal channel is highest for ox traders, while it is lowest for calves. The proportion of producer share of final cattle price from informal market channel is 18% lower than that of formal. This indicates that it is advisable for producers to market cattle though formal channel, while it is good for trader to use informal channel that is well developed in value addition practices and linked to the largest east Africa market point, Nairobi, which by its own make difficult to compete for formal traders with informal channel that has higher market margin (Table 6). type there are formal and informal market channels. Among the channels the first formal channel was identified as the preferable marketing channel that has higher and better total final price share for producers. The monopoly nature of the terminal cattle market denies the efficient market principles that forces producers not to optimize productivity.
The analysis of the marketing costs and margin revealed that brokers incurred the lower marketing cost and traders the higher marketing cost in all cattle type. The market cost of trader and broker in informal market channel is higher than formal. Marketing margin of traders and brokers is different along different channels.
Traders and brokers get relatively better profits in informal channels. This could be the reason for most traders to participate in informal channel. The producers' share of final of cattle is relatively better in formal channel for producers. The study indicated that it is better for producers to sale cattle at formal channel, where they could optimize their benefits through cooperative and reduced transaction costs. By summing up, contrary to free market economy, market concentration ratio and margin estimated shows oligopolistic nature. It therefore means that the formal or informal market traders mainly for cattle do not bare full cost involved in the market thereby leading relatively low marginal costs.
By intuition therefore, it means that the cattle market is disintegrated in such a manner that price levels does not relay from the cattle keepers to the terminal market traders. The monopoly power in this case lies with the informal traders who are at the end of the chain. Since the pastoralists purely depend on cattle for their livelihoods, it was noted that traders take advantage of the market information to exploit the keepers through price discrimination. It was observed that there exists larger number of market brokers both for different live cattle and in many cases; the brokers hold much needed information so as maximize on the commissions.
It is also observed that monopoly market structure violates the principle of equity between the traders and the pastoralists. This is because the larger share of the market gains remains with end of traders thereby denying pastoralists a chance to realize the economic gains in cattle production.