Agricultural Market Participation Among Smallholder Farmer In Viet Nam:a Case Study In Nghe An Province

About75%of Nghe An’s population live in rural areas, with half of this proportion being poor. The rural households mainly depend on agriculture production with small scale for household consumption and selling to get income, suggesting that smallholder agriculture remains the major engine for growth rural and improvement of livelihoods for any pathway that can lift large numbers of the rural poor out of poverty. To meet the challenge of reducing poverty and improving rural incomes, it will require some form of transformation out of the semi-subsistence production systems that currently characterize much of rural Nghe An, to a more commercialized agriculture.Increased market participation by the smallholder farmer has been found to be important as a means of breaking from the traditional semi-subsistence farming. It argued that market-oriented production can achieve welfare gains through specialization and comparative advantage, economies of scale and regular interaction and exchange of ideas. Unfortunately, poor farmers who need this kind of welfare boost may be constrained by several factors in their quest to participate in the market for their goods and services.This study is to determine and assess the extent to which factors affect the market participation of smallholder farmers in the Nghe An province of Viet Nam with a view to identifying key constraints to output market participation and potential market opportunities for the smallholder farmer. We use a panel data set was collected in2012from120households through a rapid rural appraisal and a household survey. The data analysis mainly focuses on the characteristics of the households and their participation in different output markets. The study also looks at the factors that affect the likelihood and intensity of participation in different output markets among the smallholder farmer. The statistical package for socio-science (SPSS18.0) program was used for data analysis where percentages, frequencies from cross tabulation was used in descriptive analysis. Binary logistic regression model was estimated to identify factors affecting decision to participate and multiple linear regression analysis model was estimated to determine significant factors of level of participation in agricultural commodity market.In terms of factors that could enhance market participation for the smallholder farmer, we find that farm land size plays a significant role. This suggests that any hope for the smallholder farmer to make any meaningful gains from agriculture lies in improving productivity of their land as well as improving their access to land. The results also show that education level of household head, own transport assets, household had access to extension/training, road condition to nearest town and membership in farmer/women organization/groups is positively associated with increased market participation for rice. Collective action is important in facilitating access to information and, in some instances, credit. Both credit and information are critical in accessing market opportunities. Besides that, it was evidence that own communication equipments, household who is member of women’s union and road condition to nearest town were significant factors to encourage market participation for horticultural crops.. With livestock seller, the important factors affecting the decision of household to sell livestock include:education level of household head and household who is member of farmer’s union. Therefore, increasing household endowment and social capital among the smallholder farmer can be of great value in enhancing the households’ access to markets.