Factors Driving Farm Gate Price of Tomatoes in Ghana: An Application of Hedonic Model

Abstract

The study examined the relationship between product characteristics and price of tomatoes in Ghana. A well-structured questionnaire was used to collect data from 300 sampled tomato farmers. The data collected included the price and quality characteristics of tomatoes traded in spot transactions in Akumadan and Tanoso districts in the Ashanti and Brong Ahafo Regions of Ghana. Descriptive and inferential statistics were used to analyse the data. In respect of inferential statistics, hedonic price model was used to determine factors influencing farm grate price of tomatoes in the study area. The results of the study revealed that the age group involved in tomato production in the study area is youthful and dominated by men. Illiteracy is high and the majority of farmers are of Akan origin with a family-size above five (5). About half of the respondents sell their produce at the farm gate. According to the result of the hedonic model, five factors are statistically significant in the determination of the price of tomatoes, namely: distance to the farm, road quality, market information, graded product and quantity of tomatoes available for sale. The study therefore concluded that improved road networks, access to market information by the farmers, access to credit facilities from financial institution, and quality control with respect to product sorting or grading would improve the price received by the farmers. Thus there is the need for the government to improve the road network in the study area, particularly feeder roads to improve price received by the farmers. This would encourage existing farmers to continue with tomato production. Also, farmers need to be trained in sorting and grading of their produce to attract a good price.