Ex-Ante Analysis of the Demand for new value added pulse products: A case of Precooked Beans in Uganda

Paul Aseete, Enid Katungi, Jackie Bonabana, Michael Ugen and Eliud Birachi

Background • Common bean is the most important grain legume (produced and

consumed) in east and central Africa

• Its consumption is however constrained by long cooking time and high fuel requirements.

• While breeding has produced fast cooking bean varieties, the reduction in cooking time has not been significant

• Through a Public private partnership, efforts are ongoing to explore industrial processing options to reduce cooking time

• This will lead to the production of fast cooking beans -“precooked beans”

Background • Precooked beans are beans processed by cooking under high

temperature and pressure and packed in air tight and weather proof sachets that can preserve them for about six month

• Once precooked one will only need to cook beans for 10-15 minutes

• Key benefits will be; adapt to changing lifestyles of growing urban population, reduce cost of fuel and environmental conservation.

• Little is known about how benefits from precooked beans will translate into demand and acceptability

• The objective of this study was to determine consumer acceptability and demand for precooked beans and to segment the market.

Methods • A choice experiment was used to elicit consumer demand of precooked

bean based on product attributes

• The main attributes included: cooking time, nutritional enhancement, fuel saving, price, and water requirement

• These were combined, based one their levels, into choice sets (Figure 1) and subjected to respondents.

• Data was collected from 558 households in five districts of central Uganda - Kampala, Wakiso, Mukono, Buikwe and Luweero

• Respondents were blocked in 3 blocks and each respondent was subjected to 7 choice sets

Methods

Figure 1: Sample of choice set showing attribute combinations.

Methods The latent class model was used to assess consumer valuation and to

segment potential precooked beqn consumers.

• The model has the capability of estimating weights attached to each attribute and classifying consumer into homogenous groups base on their preferences.

• The unconditional probability of choosing alternative j in ith situation is

𝑃𝑃𝑟𝑟(𝑇𝑇(𝑛𝑛)) = ��exp(λsZn)∑ (λsZn)𝐼𝐼𝑗𝑗=1

� X�� exp(𝛽𝛽𝑠𝑠

1𝑋𝑋𝑛𝑛𝑛𝑛𝑛𝑛)∑ exp(𝛽𝛽𝑠𝑠

1𝑋𝑋𝑛𝑛𝑛𝑛𝑛𝑛)𝐼𝐼𝑗𝑗=1

𝑇𝑇(𝑛𝑛)

𝑛𝑛 (𝑛𝑛) ��

Results Variable (Description) Analysis Sample Statistic

Will buy precooked beans % Yes 89.1 Purchase frequency No of meal in a week 4.1 Av. Expected Purchase Quantity (For a Households) Kg 0.96 Best Price Ush (USD) 2,695 (0.84) Consumer location % urban 59.6 Gender of the household head % male 72.7 Sauces eaten in a week (ate more than 4 sauces) % 22.8 Source of beans for consumption % own production 30.2 Source of beans for consumption % from market 66.1 Education of the household head (Years ) Mean 10.19 (5.056)

No. of dependents (Children below 15 years) Mean 3.33 (2.670)

Quantity of beans consumed in a week (Kg) Mean 3.28 (3.535)

Distance to the bean market (Km) Mean 0.58 (1.270)

Household monthly income Mean 821,000 (1874225)

Results Table 2: Consumer valuation of precooked beans attributes

Attribute Parameters Multinomial

logit

Latent class logit

Class 1 Class 2 Class 3

Utility coefficients of parameters in latent class model Coefficients (Standards Errors)

ASC β ASC 0.0617 (0.0875)

-0.3628** (0.1519)

1.6936*** (0.2015)

-1.6766*** (0.5137)

TIME β TIME -0.0082*** (0.0017)

-0.0087*** (0.0031)

-0.0104*** (0.0033)

-0.0100 (0.0105)

FUEL β FUEL 0.0051*** (0.0010)

0.0097*** (0.0019)

0.0042** (0.0019)

0.014388* (0.0054)

NUTRI β NUTRI 1.6614*** (0.0515)

2.9218*** (0.0789)

0.4522 *** (0.1163)

0.7430*** (0.2363)

WATER β WATER 0.1580*** (0.0478)

0.1214 (0.0817)

0.3774*** (0.0980)

0.2083 (0.3934)

PRICE β PRICE -0.0002*** (0.2409D-4)

-0.0002*** (0.3856D-04)

-0.0003*** (0.4109D-04)

-0.0011*** (0.0002)

LL= -2784.77, AIC=5649.5, BIC=2950.2, ρ2 = 0.35105 Observations =3906, Sample = 558

Results

Household characteristic Class 1 Class 2 3 Constants 5.6273*** (2.1154) 6.8917*** (2.1936) - Consumer location (1=Urban, 0=otherwise) 0.1853 (0.4257) -0.0975 (0.4711) - Gender of the household head (1= Male, 0=female)

-0.2321 (0.4212) -0.6507 (0.4787) -

Education of the household head (Years) 0.0976** (0.0380) 0.0404 (0.0424) - Number of dependents (Number less 15 years) 0.0564 (0.0761) 0.0479 (0.0855) - Quantity of beans consumed in a week (Kg) -0.1255** (0.0615) -0.0430 (0.0681) - Household monthly income (Ln income) -0.3077** (0.1461) -0.3472** (0.1461) - Distance to the bean market (Km) -0.483D-04 (0.0004) 0.0393*** (0.0018) - Processing benefits (PB index) 0.6538***(0.2067) 0.5823** (0.2405) - Sauce Diversity (1=More than 4 sauces, 0=Less than 4 sauces )

-0.2308 (0.5157) 0.5022 (0.5521) -

Source of beans for consumption (1= Market, 0=Otherwise)

0.0021** (0.4279) -0.0363*** (0.0022) -

Table 3: Determinants of Latent Class membership

Results • Class 1 has significantly more educated household heads, consume less

beans, have low incomes, like benefits and rely on bean from the market

• We can say these are - Fairly low income urbanites.

• Class 2 has low income earners, face longer distance to the market, like benefits in precooked beans and rely less on bean from the market.

• We can say these are – Rural low income households

• Though class 3 is normalized, it has close characteristics as class 1.

Conclusions

• Attributes that will influence the demand for precooked beans include; nutritional enhancement, water saving and fuel saving– these can form Unique selling points

• The principle consumers are likely to be low income urban households that rely on the market as a source of bean for consumption - - - 63% of the market.

• The precooked bean product should be produced and promoted as a product with diverse benefits

• Further research needs to be done on the actual product once on the market to elicit actual demand and make demand projections.

ACKNOWLEDGEMENTS

THANK YOU