Fish plays an important role in both nutrition and the economy of Malawi. With low cholesterol content, fish is rich in vitamins, iodine, potassium, iron, proteins, omega-3 fatty acids, calcium, and zinc. The fisheries sector contributes about 4 percent to Malawi’s Gross Domestic Product, employs 60,746 people annually and supports livelihoods of about 1.6 million people. The development of this sector is constrained by a limited understanding of how the choice between different fish products is affected by the socioeconomic characteristics of consumers, marketing factors and fish-specific attributes.
In an IFPRI Malawi brown bag research seminar on March 18, 2020 Christopher Chikowi, a MSc student at the Department of Agricultural and Applied Economics at the Lilongwe University of Agriculture and Natural Resources (LUANAR), presented on a recent study, which analyzed consumer choices and demand for two species of tilapia, Lake Malawi Oreochromis Nyasalapia, popularly known as Chambo, and Oreochromis Shiranus, known as Makumba, in unprocessed (fresh and fresh-frozen products) and processed (smoked and dried products) form in urban Malawi. While O. Shiranus is mostly farmed in aquaculture, O. Nyasalapia is mostly caught wild from the lake.
Using a multistage sampling technique, the study team analyzed data collected from a sample of 584 urban households in 14 wards in Blantyre and 15 areas in Lilongwe.
The study found that consumers preferred unprocessed over processed products and O. Shiranus over O. Nyasalapia. Consumers also prioritized taste over form and size and health benefits played a bigger role among consumers in Blantyre. Market vendors followed by Maldeco outlets were the most mentioned source of tilapia products.
Nutrition knowledge played a role in purchase decisions. People without nutrition knowledge purchase based on price followed market availability, whereas people with nutrition knowledge prioritize nutritive value followed by market availability. Consumers demand higher mean quantities of unprocessed products than processed products, both within species and within a given city. Furthermore, consumers purchased more unprocessed and processed O. Nyasalapia than unprocessed O. Shiranus. These preferences in demand can be partly explained by the overall higher prices for processed products irrespective of species and the higher prices charged for processed and unprocessed O. Shiranus.
Regression models were employed to analyze the correlates of consumer choice and demand for tilapia products. The results from the variance-covariance matrix show that consumers are able to: (1) substitute unprocessed tilapia products with each other; (2) substitute unprocessed product of one species with the processed product of another species, and (3) complement choices of processed products from one species with processed product of another species. Consumers complement quantities of one tilapia product with any of the other tilapia products.
A one-year increase in the number of years spent in school increased the purchased quantities of unprocessed and processed O. Shiranus and unprocessed O. Nyasalapia. This can be attributed to increase in income levels that come with more education, as well as better knowledge of nutrition. Easiness of cooking increased urban consumers’ likelihood of purchasing processed O. Nyasalapia; but reduced it for O. Shiranus. Color and size also influenced the demand for unprocessed and processed tilapia.
Chikowi concluded his presentation with five recommendations:
- Promoting cost minimization strategies along the tilapia fish value chain.
- Promoting tilapia fish production.
- Promoting tilapia fish processing.
- Ensuring the availability of tilapia fish products.
- Promoting tilapia products on the market.
In the following questions and answer session, participants reflected on these recommendations. One participant noted that people are generally willing to buy fish, but that products must be affordable for rural communities. Another participant said it is necessary to reduce aquaculture production costs, for example, by raising fish only to the medium size preferred by consumers. In addition, it was said that if fish from the lake are cheaper than farmed fish, so with consumers likely to choose cheaper wild fish, growth of aquaculture sector is likely to face challenges.
Note: This study is an output of our Bunda Grant Scheme program. The program is made possible by the support of the American people through the United States Agency for International Development (USAID). Data collection for this study was financially supported by AquaFish - Africa Center of Excellence at the Lilongwe University of Agriculture and Natural Resources.
The seminar presentation can be viewed below.
The presentation is available as pdf document here. (1 MB)
The working paper "Consumer Choices and Demand for Tilapia in Urban Malawi: What are the complementarities and trade-offs?" is available here.
