Impacts Of the Warehouse Receipt System In Improving The Quality Of Life Of Smallholder Coffee Farmers

Abstract

The aim of the study was to assess the impacts of the warehouse receipt system in improving the quality of life of smallholder coffee farmers. The case study is Mbozi District because it is among the major coffee producer districts in Tanzania. Specifically, the study aims at studying the warehouse receipt system practices in Mbozi district, examining the quality of life of smallholder coffee farmers, and assessing the challenges of warehouse receipt system to smallholder coffee farmers. The research design is grounded theory since the study uses a qualitative research approach to uncover the unknown impact of the warehouse receipt system in improving the quality of life of smallholder coffee farmers in Mbozi. Studies have shown that the warehouse receipt system is profit-efficient and influences the income of farmers, hence a concern of improvement of smallholder coffee farmers’ quality of life arose. The sample size was 30 respondents from smallholder coffee farmers, and key informants from Coffee Management Services and Mbozi Coffee Curing Company Ltd, Agricultural and Marketing Co-operative Society officers, and Mbozi district co-operative officers, obtained by purposive and convenience sampling. Primary data was collected from interviews and conducting focus group discussions while secondary data were collected from reviewing the official reports maintained by key respondents. Thematic analysis was used to analyse data. The study found that warehouse receipt system is operational in Mbozi district and has contributed to the improvement in the quality of life of smallholder coffee farmers by improving farmers’: material living conditions, quality of farming works, economic and physical safety, quality of health, and quality of education. Regardless of its benefits, the operations of warehouse receipt system are facing a significant number of challenges including high loan interest rates charged by commercial banks that hold back the participation of farmers. The government is advised to review and set encouraging terms and conditions for farmers’ loans. The focus should be on the reduction of loan interest rates charged by commercial banks and setting favourable loan repayment periods in order to reduce the costs added to farmers and promote farmers’ participation in the warehouse receipt system.