Abstract:
Beans are widely grown as a major food crop in Eastern and Southern Africa. It is
the most important staple food crop after maize in Kenya (ECABREN, 2000). The beans
industry in Kenya is faced with problems of shortages, seasonal supply and price
fluctuations and inadequate information on production, marketing and consumption.
These problems are more acute in urban areas. This paper analyzes the structure and
performance of the beans marketing system in Nairobi metropolitan area, the single most
important beans market in Kenya. Data from a sample of 102 traders augmented by
secondary data were used to analyze the marketing system by applying descriptive
statistics, concentration ratios and co- integration models. The results showed that the
beans marketing structure approached that of pure competition; however, lack of capital
was a barrier to entry into the wholesale and retail trade. The Johansen likelihood-based
vector autoregressive model showed that there was no significant co- integration of the
major markets in the city possibly due to inefficient market information flow.
