Agricultural Economics

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Agricultural Economics applies economic principles to solve agricultural and agribusiness problems. Our degrees equip graduates for professional and senior management positions, and are highly valued by employers. They give our graduates the flexibility to pursue a wide range of career opportunities. The Agricultural Economics major can be taken as part of a BScAgric (4 year) degree. Students taking the BScAgric option must major in Economics and Agricultural Economics, and take subjects such as Biometry and Statistics, Animal Science, Crop Science, and Horticultural Science.

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Adoption and economic assessment of Integrated Striga Management (ISM) technologies for smallholder maize farmers in Northern Nigeria.
(2017) Hassan, Muhammad Bello.; Baiyegunhi, Lloyd James Segun.; Ortmann, Gerald Friedel.
The agricultural sector plays a crucial role in Nigeria. According to a recent report released by the Food and Agriculture organisation and the National Bureau of Statistics (NBS), the agriculture sector contributed only 20% to Nigeria’s gross domestic product (GDP) in the year 2014. The sector remains critical to national food security, wealth creation, employment generation and above all poverty reduction, as over 70% of the workforce is engaged in the sector either directly or indirectly. However, the sector is being constrained by many factors. Significant among them are the infestation of the parasitic weed, Striga, drought, low soil nitrogen and climate change. Globally, the estimate of the land area affected and under threat by Striga spp. is about 44 million hectares (ha) of cultivable land. This weed impinges on the livelihoods of more than 100 million smallholder farmers. Striga mostly affects land planted with cereals, which lead to a substantial loss of cereal yield ranging between 10% and 100%, depending on crop and variety. Host plants severely affected are cowpea and cereals like rice and sugarcane. Cereal is usually the most severely damaged crops, followed by cowpea. The African Agricultural Technology Foundation (AATF) estimated that over 822,000 ha of maize farms in Nigeria is infested by Striga, which represents about 34% of the total farmland in Africa. Striga decreases maize productivity by 20% to 100%, sometimes leaving farmers with no harvest and little or no food. Based on the initial study output obtained in the Bauchi and Kano states, the major constraints plaguing maize and cowpea growing areas in the study region were identified to be Striga, stem borers, termites, storage insects, low and erratic rainfall, water logging, and low input. The majority of farmers (over 80%) in the surveyed states reported Striga as the most important constraint upon maize production. As a result of the intensity of Striga’s occurrence in northern Nigeria and its damaging effect on cereal and legume crops, the International Institute of Tropical Agriculture (IITA) commissioned and initiated an Integrated Striga Management in Africa (ISMA) project in collaboration with the Ahmadu Bello University (ABU), the Bayero University Kano (BUK), the Institute for Agricultural Research (IAR), the Kano State Agricultural and Rural Development Authority (KNARDA) and the Bauchi State Agricultural Development Programme (BSADP). The ISMA is an extension project being implemented in two states, Kano and Bauchi, with a lag period of four years, starting from 2011-2014. Specifically STR varieties and other Striga management technologies needed to be developed in order to curb with Striga problems. This action was essential considering the economic importance of cereal production, particularly maize, and the magnitude of investment made towards improving maize production such as doubling the maize project via the Federal Government and donor agencies in northern Nigeria. There is a need to understand why many farmers are not adopting the ISM technologies despite its suitability and ease of application. At this stage, there is also a lack of research on the prospect of adoption and the economic benefits of using ISM technologies in northern Nigeria. This study was, therefore, an attempt to address these knowledge gaps. Furthermore, it provided an opportunity to draft relevant policy and management implications to inform future strategies in the agricultural sector, particularly in maize production. The specific objectives of the study were (i) to identify the socioeconomic characteristics of maize-producing households and their perceptions of ISM technology attributes in the study area; (ii) to determine factors influencing farming households’ potential adoption and intensity of adoption of ISM technologies in the study area; (iii) to estimate the potential impact of ISM technology adoption on livelihood improvement, income and food security of maize-farming households in the study area; and (iv) to assess the financial and economic profitability, and identify the constraints upon the adoption of ISM technologies at smallholder farm level in the study area. The data used for this study were collected by means of a multi-stage sampling procedure from a cross-section of 643 respondents selected from 80 communities (353 adopters and 290 non-adopters from both project intervention areas (PIAs) and non-project intervention areas (NPIAs). The results revealed a significant overall adoption rate of 55% of the targeted population in the study area. The difference in performance in terms of adoption between PIAs and NPIAs was 11%. The results demonstrated the effectiveness of on-farm trial evaluations with farmers through organized field days. Thus, the scaling out of the technologies to NPIAs will help potential adopters to make more informed decisions in eliminating Striga. In addition to on-farm trials and field days, the improvement of public knowledge about ISM technologies can be achieved through mass public education and awareness programmes. Results from the double hurdle regressions showed that the estimated coefficients of exogenous income and distance to extension office had a negative impact on adoption. Higher total farm income, polygamous households, past participation in on-farm trials, awareness of the technology, contact with extension agents and access to cash remittances had a positive impact and are the most significant factors likely to influence ISM technology adoption. Marital status, household size, farm size and access to cash remittances are the most significant factors influencing adoption intensity. Maize farmers in the study area, who adopted ISM technologies, were found to have obtained higher output than non-adopters, resulting in a positive and significant effect on their total farm income. Hence, policies targeted at increasing maize productivity through Striga management need to include ISM technologies as a potentially feasible option. This study recommends actions to improve farmers’ access to financial services in order to increase their liquidity. Nevertheless, immediate action will be an improvement in farmers’ access to extension services, as they have demonstrated to be a reliable source of information in rural areas. Results from the TE regression model indicated that adoption of ISM technologies played a positive role in enhancing farm productivity of rural households, with adopters producing about 47% higher maize output than that of non-adopters (p<0.001) after controlling for selection bias and endogeneity. Also, the result from the Foster-Greer-Thorbecke (FGT) index showed that adopters are not as poor in terms of household income per adult equivalent when compared to non-adopters. The result from the endogenous switching regression (ESR), which accounts for heterogeneity in the decision to adopt or not, indicated that ISM technologies have a positive effect on farmers’ income, as measured by farm income levels per adult equivalent. It was also found that ISM adoption increased farming income by 66%, although the impact of technology on farming income was smaller for farm households who did adopt the technology than for those who did not adopt it. In the counterfactual situation, however, if non-adopters had adopted the technology, they would have gotten more benefit than adopters. It implies that the integrated approach to Striga management is beneficial to smallholder farmers and need to be scaled out to other areas prone to Striga. Results from the economic impact analysis also indicated that gross margins (GM), benefit-cost ratio (BCR), and net benefit per capita for the ISM technologies are all positive across all locations. Therefore, farmers can recover their costs and maintain a positive balance. The highest GMs made ISM technologies a viable, profitable, bankable and potential option for northern Nigeria which is prone to Striga. ISM technologies guarantee significantly higher yields than local practices. Thus, the long-term economic worth indicators showed that ISM technologies could lead to increased income and poverty reduction. Also, its net present value (NPV), BCR and net benefits per capita are attractive. ISM technologies, especially maize-legume rotation with STR maize and Imazapyr-resistant maize (IRM), should occupy a central role in the design of Striga eradication campaign initiatives and sustainable management in maize fields. ISM technologies should therefore be prioritised, particularly in the Striga-infested areas of northern Nigeria. In general, findings from the study proved the need to support the provision of extension services, on-farm trials and field demonstration to remote areas, as the results suggest that distance to the extension office do influence adoption of ISM technologies. In an effort to enhance farmers’ access to ISM technologies, the public sector needs to take the lead in technology promotion and dissemination at the initial stages and create an enabling environment for effective participation of the private sector. Awareness campaigns for ISM technologies, combined with the improvement of appropriate access to these technologies and corresponding inputs, and accessible rural micro-finances at reasonable costs will offer the most likely policy mix to accelerate and expand the adoption of ISM technologies. While awareness of ISM technology is a major problem, it is clear that the availability of seed (for seed-based technologies) is a serious issue. Therefore, improvement in the Nigerian seed sector is required to boost adoption. High risk and fear of failure are related to farmers’ risk aversion. All technologies requiring cash investment reflect a face of fear and risk constraint for most farmers.
Adoption and willingness to pay for organic fertiliser: a case of smallholder potato (solanum tuberosum L.) farmers in KwaZulu-Natal, South Africa.
(2020-03-12) Bhekani, Sandile Zondo.; Baiyegunhi, Lloyd James Segun.
Potato cultivation involves intensive soil tillage throughout the cropping season, which often results in soil degradation, erosion, and leaching of nitrates. Literature suggest that efforts to produce sufficient food necessitate an increase in agricultural production per unit of inputs by adopting fertility-enhancing techniques (both organic and inorganic fertilisers) to replenish soil nutrients required by crops. However, inorganic fertiliser as a soil ameliorant is known for causing soil degradation, environmental pollution, and it is associated with escalating costs. As a result, smallholder farmers are constrained in realizing their maximum yield potential. One of the ways to boost productivity without degrading the environment is to adopt a more sustainable, low-cost, and efficient integrated nutrient management system, which also suit their socioeconomic status. Although there is sufficient advocacy in the adoption of sustainable agricultural inputs such as organic fertiliser, the economic linkage between farmers' socioeconomic factors and adoption has not been adequately explored. Moreover, there is a dearth of empirical evidence regarding the willingness of farmers to pay a price premium for organic fertilisation of their soil. The aim of this study was to evaluate socioeconomic factors influencing the adoption and use intensity of organic fertiliser among smallholder potato farmers’ as well as to estimate their willingness to pay (WTP) a price premium for organic fertiliser. Primary data was collected from 189 smallholder farmers in three municipal areas in KwaZulu-Natal Province, South Africa, through a multi-stage sampling technique. The analytical framework incorporated descriptive statistics, double-hurdle, and ordered probit models. The double-hurdle model was used to identify the factors influencing the adoption and use intensity of organic fertiliser, under the assumption that the decision to adopt and the intensity of adoption are separate. The contingent valuation method (CVM) was used to elicit information for the WTP, and after that, the ordered probit model was employed to estimate the determinants of farmers' WTP for organic fertiliser. Empirical results indicate that factors such as household head gender, household size, access to credit, access to extension, knowledge of organic fertiliser usage, land ownership, livestock size and access to social grants significantly influenced the decision of organic fertiliser adoption. In contrast, factors such as the age of farmer, knowledge of organic fertiliser usage, farm size and livestock size significantly influenced the use intensity of organic fertiliser. In addition, results revealed that factors such as marital status, access to extension services, and knowledge of organic fertiliser usage, land ownership, livestock size and distance to the source of organic fertiliser were also statistically significant in determining the farmers’ WTP a price premium for organic fertiliser. The study found that the rate of organic fertiliser adoption is very high among the sampled potato smallholder farmers even though there is still a notably large number of farmers who are not using organic fertiliser. This result leads to the conclusion that organic fertiliser is the most popular soil nutrient ameliorant among smallholder potato farmers in KwaZulu-Natal Province, South Africa. This study also found that WTP a price premium for organic fertiliser was very high and this lead to a conclusion which justify the prospect of commercialization of organic fertiliser to facilitate the availability of organic fertiliser to those that are willing to pay for it. This study recommends improved access to extension services to improve technical information dissemination and knowledge of organic fertiliser usage among smallholder farmers. There is also a need to develop policies that strive to institute security of land tenure among smallholder farmers, which will encourage smallholder farmers WTP and also adopt and intensify organic fertiliser. Keywords: Organic fertiliser, smallholder farmers, adoption, use intensity, willingness to pay, Contingent valuation, Craggs’ Double Hurdle model, Ordered logit model.
Causality analysis and physio-economic impacts of climate change on maize production in South Africa.
(2019) Magodora, Tatenda Lysias.; Baiyegunhi, Lloyd James Segun.
Agriculture, as part of the human ecological footprint on climate change, has become a serious concern because climate change has an impact on agriculture. For instance, when crop production is considered, climatic elements are influenced by greenhouse gas emissions that come from agricultural activities such as the application of synthetic fertilizers, herbicides and pesticides, as well as the use of heavy machinery in modern crop production. This study analyzed the possible causalities between climatic variables and maize production in South Africa using time series data for the period 1924 to 2016. The analysis was done using VAR Granger causality analysis to ascertain if there are feedback loops between climatic elements and maize production in South Africa. The results from the Granger analysis suggest a bidirectional causality that runs between maize production and temperature. Rainfall alone was found not to be significant in influencing maize production but a combination of both temperature and rainfall affects maize production in South Africa. The results from variance decomposition of the future forecasts suggest a relatively large magnitude of impact (13.37%) of temperature on maize production in the 3rd year of the forecast with the highest effect of 27.43% in the 15th year of forecast. The forecasted impact of rainfall on the other hand remained relatively low (below 10%) throughout the forecast period. Continued current production activities (use of synthetic fertilizers and agricultural chemicals, for example) will affect climatic variables both in the short term and in the long term, and the effects of these changes in climatic elements on maize production will be realized in the long term as revealed by the variance decomposition result. The study further investigated the impacts of global warming on maize production in South Africa using meta-analysis (for physical impacts) and the Ricardian analysis (for economic impacts). The meta-analysis made use of studies that investigated and reported percentage changes in maize yield owing to climate change in South Africa. The average estimated percentage change in maize yield was calculated from 34 studies using the bootstrapping sampling technique. Results from the meta-analysis suggest that maize yield will drop by more than 15% owing to temperature increase of about 20C to be realized between 2081 and 2100. The Ricardian analysis made use of time series data for the period 1987 to the end of 2018. The results from the Ricardian analysis also show that climate change is a significant threat to the South African maize industry, as it is estimated to lose an average of 38% of revenue owing to plus 20C warming. Given these outcomes, the study suggested the adoption of sustainable farming activities such as minimum tillage, balanced fertilization and biochar amendments at a much faster rate in order to ensure a sustainable increase in maize production, while at the same time reducing the human ecological footprint on climate change. The study also recommends the recognition of the agricultural sector as one of the sectors that should be targeted by the carbon emission reduction systems.
Comparative analysis of the impact of food prices on household food security : evidence from the North-West and KwaZulu-Natal Provinces, South Africa.
(2015) Phali, Lerato.; Mudhara, Maxwell.; Baiyegunhi, Lloyd James Segun.
The prevalence of household food insecurity in South Africa is not a result of a shortage of food but of a lack of access to food. Contributing to this are the rising food prices that adversely affect the rural poor, as most of them are net buyers of food. Due to the higher food prices, poor households are forced to spend a large proportion of their income on food. The objectives of this study are to determine socio-economic characteristics that influence household perceptions of food prices and to evaluate the impact of food prices on rural household food security in South Africa. The study considers two rural areas that have different food price regimes, namely, Jericho in the North-West Province and Swayimane in the KwaZulu-Natal Province. The results are based on household level data collected from a sample of 300 households using structured questionnaires. The Ordered Logit Regression (OLR) model was used to evaluate the impact of food prices on rural household food security status, using the Food Expenditure Income (FEI) ratio as a household food security indicator. The ratio indicates the proportion of household income spent on food. Its components are directly linked to two of the four aspects of food security, namely food stability and food accessibility. According to Engel’s Law, the proportion of income spent on food declines as income increases. This implies that low income households spend a large proportion of their income on food, resulting in a high FEI ratio. The findings of the study indicated that households in Swayimane are more likely to be “well-off”, compared to those in Jericho. Location, gender of household-head, number of permanently employed household members and total household income significantly influenced household food security. Food price perceptions influence buying and consumption patterns of households. Using the Tobit regression model, households’ socio-economic characteristics that determine household perceptions of food prices were identified. A Food Price Perception (FPP) index was generated using principal components analysis and was used to evaluate the relationship between food price perceptions and household food expenditure patterns. The results showed that households in Jericho had higher perceptions of food prices and that location, total household income and the number of permanently employed household members influence a household’s perception of food prices. Another finding was that households with a higher perception of food prices were low-income households that spend a large proportion of their incomes on food. The study recommends that policy priorities should be focused on the establishment of retail outlets in rural communities. Establishment of new employment opportunities and increased wages will also help improve household food security through increased food affordability.
Households’ consumption and quality perceptions of local (ofada) rice in South-West Nigeria.
(2020) Ogunleke, Ayodeji Oluwaseun.; Baiyegunhi, Lloyd James Segun.
Rice has become an essential crop in Africa, with imports into the African continent accounting for more than a quarter of the world’s trade in rice. It has become one of the fastest-growing food sources to both rich and poor households. In Nigeria’s household food consumption, rice is the fifth most common food after tubers, vegetables, beans, and sorghum representing about 5.8% of households’ spending. In recent years, local rice production has expanded significantly in Nigeria and is increasingly becoming an alternative to foreign rice with government’s initiative to make the country self-sufficient in rice production under its Agricultural Transformation Agenda (ATA) and other policy initiatives put in place to address the local rice supply-demand gap. Following improvements in processing, polishing and packaging, many local rice brands with enhanced physical quality attributes that can compete favourably with imported rice brands are now available in Nigerian markets. Among these local rice varieties, local (ofada) rice is peculiar to but not limited to South-west, Nigeria and has been gaining international recognition in the recent time. The general objective of this study is to estimate households’ consumption and quality perceptions of local (ofada) rice in South-west, Nigeria. A multi-stage random sampling technique was used to select 600 rice consuming households through a well-structured questionnaire. Different econometric techniques (IV-Tobit, Factor and cluster analyses, Hedonic pricing model, Kendall concordance test, Profile deviation analysis) were used to analyse the data. The results of the descriptive statistics show that on the average, quantity of local (ofada) rice consumed by a household ranges from 6.19kg to 25.8kg per month with income ranging from ₦38,265.35 to ₦157,224.71. The dietary knowledge score registered an average of 4.67 (out of 10). Also, over 50 percent of the households are headed by male, 85 percent are married, 54.8 percent has family size of less than five people, while 50 percent of the participating households have two or more income earners. The result of IV-Tobit reveals that dietary knowledge is significantly influenced by factors such as being a household meal planner or having a household member(s) on a special diet. Dietary knowledge as hypothesized, was found to positively influence the consumption of local (ofada) rice, as were some sociodemographic variables. The results of factor analysis show that households valued virtually all the local (ofada) rice attributes. Three clusters of local (ofada) rice consumers’ households were identified under segmentation and each segment (cluster) has different concerns and interests towards local (ofada) rice variety. Cluster 1 considered all the attributes of local (ofada) rice variety as important and was named meticulous cluster; cluster 2 valued physical appearance of the local (ofada) rice and was named extrinsic cluster; while cluster 3 was named casual because it was neutral to all the attributes considered for quality perceptions of local (ofada) rice, indicating a type of ethnocentric behaviour of the consumers. The result of Kendall concordance coefficient shows 73.74% agreement in ranking quality attributes of local (ofada) rice by consumers’ households. Colour, perceived nutrient level, taste, grain shape and rate of breakage were the most ranked quality attributes with Mean Attribute Ranking Scores (MARS) of 1.56, 1.69, 3.12, 5.53, and 5.86, respectively. Households are willing to pay Marginal Implicit Prices (MIPs) of ₦71.03 ($0.20), ₦45.23 ($0.13), ₦32.98 ($0.09), ₦21.06 ($0.06), and ₦14.41 (0.04), per kg for colour, grain cohesion, grain shape, perceived nutrient level and perceived chemical storage while discounting MIPs of ₦60.55 ($0.17), ₦19.36 ($0.05), ₦17.14 ($0.05) and ₦6.00 ($0.02) for texture, rate of breakage, perceived freshness, and low swelling capacity per kg of local (ofada) rice, respectively. The result of profile deviation analysis also reveals significant negative consumer satisfaction and loyalty implications of deviating from ideal consumer profile. Both consumer loyalty and consumer satisfaction have the same level of negative consequences. When considering the aggregate (total) profile deviation in both cases, the variance explained by the models are almost the same for satisfaction and loyalty. Moreover, when looking at the disaggregated Profile Deviation (PD) effects, both hedonistic value and trust are predicting negative consumer satisfaction and loyalty outcomes. This suggests that improving consumer satisfaction and loyalty have similar challenges and required same task. It is consumer hedonistic value and trust in local (ofada) rice that account for the significance of the total Profile Deviation result. Therefore, this study recommends that nutritional information that are appealing about local (ofada) rice variety be introduced through advertisements on different media such as radio, television and print media. Also, a marketing-mix determination should be adopted, which involves developing and implementing a strategy for delivering an effective combination of want-satisfying features to consumers within target market for local (ofada) rice as the aim is to make the variety available across the country. In addition, modern rice processing and polishing that incorporate traditional technology are required to improve both extrinsic and intrinsic qualities (swelling capacity, rate of breakage, texture, etc.) of local (ofada) rice to enhance consumers’ households acceptability, affordability and competitiveness. Lastly, efforts should be made by the concerned authorities and stakeholders in the rice value chain in making sure that there is reduction in cost of production in order to lower the market price of local (ofada) rice and in extension, local rice generally
The impact of outsourced extension services on the performance of smallholder farmers in Msinga, KwaZulu-Natal, South Africa.
(2018) Majokweni, Zipo-zihle Pilela.; Baiyegunhi, Lloyd James Segun.; Ferrer, Stuart Richard Douglas.
Smallholder farmers are considered the potential drivers of growth and poverty eradication in Africa. Agricultural extension services play a vital role in linking farmers to information, adoption of new technologies, access to markets and so on. In recent years, there has been a shift from purely public extension to a more pluralistic approach, with the private sector providing extension services in specific project areas. The aim of this study was to assess the impact of outsourced extension services on the performance of smallholder farmers in Msinga, KwaZulu-Natal. The study also sought to estimate the indirect impact of outsourced extension services by investigating the presence of positive externalities among the sampled farmers. A random sampling technique was used to sample 300 smallholder farmers in the study area. Descriptive statistics were used to compare the differences between farmers who are beneficiaries of Lima Rural Development Foundation extension services and those who are non-beneficiaries. Factors such as years of farming experience, years of formal schooling, the amount of labour available to a household, livestock value, ownership of an irrigation tool and access to credit influenced participation in Lima extension services. The Propensity Score Matching (PSM) method was employed to estimate the impact of the outsourced extension services provided by Lima Rural Development Foundation on the farmers’ performance, measured by farm income per smallholder farmer. Various estimators, namely the Kernel, nearest neighbour and stratification, were used to ensure the robustness of the obtained results. Also, a Rosenbaum bounds sensitivity analysis test (rbounds) was done to test the data’s level of sensitivity to unobserved heterogeneity. The results of the econometric model indicated that outsourced extension services have a positive impact on smallholder farmers’ performance. Private extension services have a positive and significant impact on household crop income, net crop income and the inputs and services purchased. When compared to farmers who were not beneficiaries of Lima extension services, Lima beneficiaries received R3000 and R2600 more for total crop and net crop income per year respectively. Further analysis showed an evidence of positive externalities of outsourced extensions, due to farmer-to-farmer interactions and contact. Farmers who had received help or advice from a Lima beneficiary appeared to have an income that was an average R2 400 higher than the income of non-Lima beneficiaries. The results suggest that private extension services play a crucial role in improving the performance of smallholder farmers, and highlight the need for improved access to inputs and markets. The study recommends that the involvement of the private sector in smallholder support programmes is encouraged and sustained. Furthermore, the formation of structures such as co-operatives that encourage farmer interactions should be promoted and should be farmer led and farmer driven.
Improved rice varieties adoption and technical efficiency of smallholder rice farmers in Ogun State, Nigeria.
(2019) Olalekan, Bello Lateef.; Baiyegunhi, Lloyd James Segun.
Rice (Oryza sativa) is an essential food crop and the most consumed staple crop in the majority of the urban and rural households in Nigeria. Rice consumption in Nigeria is the highest in Africa; also, the country is one of the largest producers of rice on the continent and simultaneously one of the largest rice importers in the world (FAO, 2016). The high importation is due to the inconsistency and variability in production of rice in Nigeria. Rice yield in irrigated and rain-fed land is 3.0–3.5 mt/ha and 1.5-3.0 mt/ha which is below the potential output of 7-9 mt/ha and 3-6 mt/ha respectively. Low adoption of improved rice varieties (IRVs) is one of the major constraints leading to this low yield encountered by the resource-poor smallholder farmers. The main objective of this study was to examine the factors influencing adoption of IRVs and its impact on productivity and to estimate the differences in technical efficiency among adopters and non-adopters of IRVs in Ogun State, South West, Nigeria. A multi-stage random sampling technique was used to select 250 rice farmers and data was collected through a well-structured questionnaire. The Probit regression model was used to analyse the determinants of IRVs adoption while the stochastic frontier production function was used to model the determinants of rice output and technical efficiency. The results of the probit model showed that education, rice farming experience, access to extension services, access to credit and seed access had a significant influence on adoption of IRVs. The estimates of the average treatment effect (ATT) from the PSM method indicated that the adoption of IRVs increases productivity of smallholder rice farmers by 452kg/ha. The implication of the results suggests that priority must be given to the use of improved agricultural technology such as IRVs in order to enhance rice production. The estimate of the stochastic frontier analysis (SFA) indicates that smallholder rice farmers are producing below their potential output, however, adopters of IRVs are more technically efficient than the non-adopters. The mean technical efficiency of adopters and non-adopters of IRVs is 0.97 and 0.84, respectively. The study determined the sources of farmers’ technical inefficiency from a combined effect of farm-specific, socio-economic, socio-institutional factors and predicted probability of IRVs. The findings of the study suggest that adoption of IRVs plays a crucial role in improving the technical efficiency of smallholder rice farmers. The study, therefore, recommends an agricultural policy aimed at promoting farmers’ education, through effective extension services, providing sustainable credit facilities and efficient relationship between farmer-based organizations and seed companies (private, NGOs and government) to enhance easy accessibility of IRVs by the rural smallholder rice farmers.
Market participation, channel choice and impacts on household welfare : the case of smallholder farmers in Tanzania.
(2014) Mmbando, Frank Elly.; Zegeye, Edilegnaw Wale.; Baiyegunhi, Lloyd James Segun.
Markets and improved market access plays an important role in improving rural incomes of smallholder farmers in sub-Saharan African countries, particularly in Tanzania. Despite this, participation of smallholder farmers in markets in Tanzania remains low due to a range of constraints. In rural areas, farmers are lacking sufficient means to overcome the costs of entering the market due to high transaction costs. Poor infrastructure and weak institutions raise transaction costs that considerably alter production and market participation decisions. It is widely acknowledged that the involvement of small farmers into markets can contribute to higher productivity and income growth which, in turn, can enhance food security, poverty reduction efforts, and overall economic growth. Following the liberalisation of agricultural markets in Tanzania, smallholder farmers have alternative market channels for selling their agricultural produce, including maize and pigeonpea. These market channels offer different prices and sales services, which determine farmers’ choices of the channel and impact on household income and welfare outcome. However, in Tanzania, where smallholder farmers’ market access is a constraining factor, quantitative evidence of the relationship between market participation, market channel choice and impacts on household welfare specifically in maize and pigeonpea farmers is scant. The main objective of this study was to determine factors influencing smallholder farmers’ market participation decision, channel choice and the impacts of market participation and channel choice on household welfare. The research focused on four districts: Karatu and Mbulu in the northern zone and Kilosa and Mvomero in the eastern zone of Tanzania. A multi-stage sampling procedure was used to select villages and households, whereby a total of 700 farm households were surveyed. Heckman selection model results showed that fixed transaction costs associated with market information and household characteristics (such as gender and education level of the household head) had a statistically significant influence on maize and pigeonpea market participation. Similarly, distance to market, output prices, farm size, labour force, membership of farmer associations and geographical location of households influenced both market participation and intensity of participation. These results suggest that policies aimed at improving rural road infrastructure, market information systems, smallholder asset accumulation, human capital and promotion of farmer associations could reduce transaction costs and enhance market participation and marketed supply by smallholder farmers. The multinomial logit results revealed that transaction costs (as a result of distance to markets, quality of road to market, lack of price information, and lack of trust in working relationships with buyers), household wealth, membership in farmer association/group, access to extension services and access to credit significantly influence the choice of profitable market channels by maize and pigeonpea smallholder farmers. The results suggest that policies aimed at reducing transaction costs (such as through increased investment in rural infrastructure, improved market information systems and farm households’ access to assets) appear to be important intervention avenues that can affect profitable channel choice in the study area. Promoting farmers’ groups/associations (such as producer and marketing groups) is among the efforts that need to be focused to facilitate smallholders’ technology and information transfer, bargaining power and trust between farmers and buyers. This study also examined the impact of market participation and channel choice on household welfare. The propensity score matching and endogenous switching regression results indicated that participation in maize and pigeonpea markets has positive and significant impact on household welfare, measured by consumption expenditure per capita among sample of rural households. The results also showed that the level of market participation has significant positive impact on consumption expenditure per capita. This confirms the role of market participation and level of participation in improving rural household welfare, as higher gain of consumption expenditure from market participation and level of participation also means improved food security and reduced poverty. The empirical results from multinomial endogenous treatment regression showed that market channel choice has positive impact on household welfare. Participation in rural traders and wholesalers market channels has significant positive impact on consumption expenditure per capita relative to brokers channel, for both maize and pigeonpea. The study suggests that policies and programs that support household capacity to produce surplus production and inclusion of smallholder farmers in more profitable markets could increase market participation, improve household welfare and reduce poverty among rural households.
Mopane worms and household food security in the Limpopo Province, South Africa.
(2013) Oppong, Beatrice Bosompemaa.; Baiyegunhi, Lloyd James Segun.; Senyolo, Granny Mmatsatsi.
The main objective of this study is to examine the potential contribution of households’ involvement in mopane worm activities (harvesting, commercialisation and consumption) to households’ food security in the Mopani District of the Limpopo Province. Data was collected using a structured questionnaire from a stratified sample of 120 households, 60 of which are mopane worm harvesters. The Binary Logit Model was used to determine households’ socio-economic factors affecting participation in mopane worm harvesting. The results revealed that gender of the household head, age of the respondent, households’ size and the level of income per month increases the probability of households participating in mopane worm harvesting whilst distance to the market and food expenditure as well as religion (belonging to the Zion Christian Church) decreased the probability of being mopane worm harvester. The Ordinary Least Square (OLS) model was used to identify households’ socio-economic factors that determine the rate of commercialisation of mopane worms within harvesting households. 53 percent of the households commercialized their harvest. The model identified that gender, harvesting experience and income from mopane worm sales are the main factors determining commercialisation within harvesting households. The Household Food Insecurity Access Scale (HFIAS) was used to determine household food security status. The result revealed that about 20 percent of the harvesters were food secure, while 80 percent where food insecure. In addition, about 12 percent of the non-harvesters were food secured. An OLS model was also used to examine the impact of mopane worms in the food security status of the households in the Limpopo Province. The results revealed that age, education level of a household head, level of income, income from mopane worm sales and frequency of consuming mopane worm/day improve the food security status of households whilst households’ size and the distance to the market worsens the food security status of the households. The study found that about 48 to 60 percent of the households to be adopting less pervasive strategies like asking neighbours/family relatives for help, borrowing money for food and selling mopane worms for cash to protect their food consumption and over 70 percent adopted strategies like reducing food intake, portion size and eating less preferred food were adopted to modify their food consumption. The findings indicated that policy priorities should be focused on the promotion of harvesters associations for collective marketing and creating an enabling environment for sustainable harvesting and commercialisation.
Revealed preference analysis of consumers' switching behaviour towards rice brands in Nigeria.
(2018) Obih, Uchenna.; Baiyegunhi, Lloyd James Segun.
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