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Abstract

Igembe north is categorized as a semi arid agricultural district, with high unemployment, low incomes and dense population. Agriculture is dogged with uncertainty due to turbulent input and output prices, weather dependency and non linear relationship between inputs and outputs; hence financiers have considered the sector as unbankable. Agribusiness has emerged as a feasible way to channel credit to agriculture because it is less susceptible to the foresaid risks than farming. Value addition has the ability to create employment, absorb excess labour from agriculture, enable rural residents to capture more margins from agriculture, hence raising rural income levels. Despite the existence of microfinance and promotion of value addition, there is limited value addition and hence producers in the area receive less return from agriculture. Despite the benefits associated with value addition, what hinders butcheries in Igembe north district from adding value to their products is not known. This study established whether and why butcheries in the district add value to their products, characterized and described the systems of value addition among butchery agribusinesses, determined the socio-economic factors influencing value addition by butchery agribusinesses, and determined the influence of access to credit on value addition by butcheries in the district. A census survey of the butchery operators was done. Data collected was analyzed using descriptive methods, probit and ordered logit models. These models were achieved through STATA and SPSS statistical packages. The results revealed that value addition was significantly influenced by age, show coefficients and level of significance you are alluding to so that the results are verifiable and quantifiable credit use, education and household size. There is need to review and strengthen policies that will improve access to and use of credit and educate the society on the importance of agribusiness as a tool for poverty reduction, employment creation and economic development.

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