Abstract

This study examines coffee production and marketing systems in the Guji and West Guji zones of southern Oromia, Ethiopia, with a focus on market structure, conduct, performance, and associated constraints. Primary data were collected from 245 coffee producers and 20 traders using a multi-stage sampling technique, complemented by key informant interviews and focus group discussions. Descriptive statistics and the Structure–Conduct–Performance (SCP) framework were employed for analysis. Results indicate that coffee production is a major livelihood activity, with an average land allocation of 3.5 hectares and productivity of 8.55 quintals per hectare, exceeding the national average. However, production is dominated by local varieties (95.5%), with limited adoption of improved technologies, indicating less attention to research and development in improving coffee production and productivity through the collection or introduction of improved coffee varieties that can outperform the varieties in the hands of the farmers. The coffee market is characterized by multiple intermediaries and five dominant marketing channels, where cooperatives and processors account for the largest share of 65%, 57.4%, and 34.5% of marketed surplus. Market performance analysis reveals that producers receive a relatively low share (32.9%-44.7%) of the final consumer price, indicating inefficiencies and unequal margin distribution. Major production constraints include disease prevalence, limited access to improved varieties, and weak extension services, while marketing is hindered by low prices, poor infrastructure, and limited market access. The study underscores the need for technological, institutional, and market reforms to enhance productivity and improve producers’ market participation in the study area.