Doctoral Degrees (Agricultural Economics)

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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 impact of climate-smart agriculture technologies in integrated crop-livestock farming systems.
Mujeyi, Angeline.; Mudhara, Maxwell.
In Zimbabwe, smallholder farmers who rely on rain-fed crop-livestock systems for their livelihoods face multiple constraints which include a shortage of labour, inadequate capital to purchase inputs, low soil fertility, pests, disease outbreak, and low productivity as a result of climate change and variability. Climate change has caused prolonged droughts, reduced rainfall amounts and changing rainfall patterns, threatening the welfare of agriculture-based households. Climate-smart agriculture (CSA) technologies have been promoted as a panacea to address the negative effects of climate change. To date, the adoption of CSA has been low and on small land sizes. However, to ensure maximum benefits from CSA and scale up adoption, a better understanding is required regarding smallholder farmer adoption patterns. This study mapped adoption patterns, analysed common CSA technology bundles, measured the impact of CSA on household welfare and modelled optimal enterprise mix for farmers adopting CSA. Data was collected through a cross-sectional household survey of 386 multistage randomly selected respondents from four districts in Zimbabwe. Analysis was done using multivariate statistical techniques of principal component analysis and cluster analysis as well as the Cragg double hurdle model, multinomial logistic regression model, endogenous Switching Regression model, Cost-Benefit Analysis, stochastic profit frontier model and multiobjective goal programming. The findings based on the PCA-Clustering analysis showed that patterns of CSA varied across the household typologies. Resource endowed and experienced farmers have a high use of technologies such as crop rotation and minimum tillage that require more resources while resource-constrained clusters avoided resource-intensive CSA technologies. The Cragg double hurdle model results showed that the adoption of CSA is significantly affected by distance to the tarred road, access to weather information, livestock income share, and ownership of transport assets. Adoption intensity is significantly affected by factors such as sex of household head, labour size, frequency of extension contact, access to credit, access to weather forecasts, off-farm income, distance to input and output markets, number of traders and asset ownership. In light of these findings, policies that ensure access to weather forecasts information, coupled with frequent access to extension officers by farmers and access to credit will go a long way in encouraging farmers to scale up the use of CSA. Additionally, government efforts should be directed towards input markets decentralization which can be done through policy incentives to the private sector which brings markets closer to farmers. Also, the establishment of tarred roads in rural areas will incentivise farmers to increase the adoption intensity of CSA while on the other hand attracting more traders to the rural areas. The multinomial logistic selection model results reveal that observable household and market access characteristics influence the likelihood of a farming household adopting three identified prominent technology bundles/combinations. The results highlight that household characteristics (gender of household head, labour size), farm characteristics (soil type), and institutional factors (market access, information access and access to credit) are the main factors that determine the adoption of various CSA technology combinations. The results encourage the government to design policies aimed at improving farmers’ knowledge with regards to CSA. These should include early warning systems and programs that enhance access to information, markets and credit. The econometric results of the Endogenous Switching Regression model showed that the soil fertility status of the fields and access to weather forecasts had a significant impact on the farmer’s decision to adopt CSA. The Average Treatment effect of the Treated and Average Treatment effect of the Untreated was positive and significant for adopters and non-adopters indicating that CSA adoption had resulted in a significant positive impact on the welfare of the farmers. Analysis of outcomes revealed that farmer and farm characteristics as well as market factors significantly affected household welfare. Household income with reference to adoption was significantly affected by factors such as education of household head, labour size, TLU, off-farm income and asset index. Food security was influenced by factors such as education of household head, TLU, access to safe water, access to sanitation, access to inputs and output markets. Results from the cost-benefit analysis revealed that maize performs best under CSA technologies. The cost-benefit analysis results point to the potential of CSA in positively influencing profitability as a result of reduced costs and improved productivity. The profit inefficiency model showed that extension contact, number of traders locally and adoption of CSA had significant negative coefficients implying that as these variables increase, profit inefficiency among maize growing farmers then decreases. The findings call for development practitioners to incorporate market linkages that bring buyers closer to the farmers and support for extension staff to be able to have frequent contacts with farmers. Results of the multi-objective goal programming model suggest a reduction in the area committed to field crops and point towards concentrating on high-value crops such as horticulture and larger ruminants such as cattle.
Agricultural bilateral trade agreements between South Africa and the European Union : implications for the South African fresh orange industry.
(2000) Gay, Stephan Hubertus.; Nieuwoudt, Wilhelmus Liberté.
During October 1999 South Africa and the European Union (EU) signed the "Agreement on Trade, Development and Co-operation". This agreement includes a Free Trade Agreement (FTA) which will lead to a free trade area between both partners. The framework for a FTA is set by the World Trade Organization (WTO). This study focuses on the effects of the FTA on the South African fresh orange industry. Fresh oranges account for approximately ten percent of South African agricultural exports. On the other hand, South Africa is the second largest external supplier to the EU and dominates the EU off-season. Fresh oranges are only included in the FTA from June until September and tariffs are reduced by approximately three percent in this time which is the peak South African export season. A trade simulation model was developed using the programme STELLA to analyse the effects of the FTA on the South African fresh orange industry. The trade simulation model consists of seven sub-models for production according to region and cultivar; a local market model, an export market model and an exchange rate model. The production models run on an annual basis whereas the other sub-models run on a monthly basis to capture the seasonality in fresh orange trade. The simulation period lasts from 1997 until 2011, hence fifteen years. The production models use gross margins according to the age of the orchard. The annual production is divided into monthly production on the basis of industry information. The South African demand function in the local market model uses the consumption per person, the export price and trend as independent variables. A trend variable is included to cater for the change in consumer preferences, especially, the move from oranges towards easy-peelers. On the EU market, prices are seen as external variables, except for the months July until October when the South African market share exceeds 50 percent. During these months an import demand flexibility is derived on the basis of the South African market share. The exchange rate model derives from the purchasing power parity between the South African Rand and the Euro. Simulation model results indicate that the FTA is beneficial for South African producers while South African consumers may also benefit. Further producers are expected to benefit from a slight increase in real free-on-board prices and a slight increase in total production. South African consumers are expected to benefit from a simulated decrease in real local prices due to the predicted increase in production. The effects on the EU market are simulated to be even smaller. A slight increase in EU prices is simulated during South Africa's peak export season which is the EU off-season. Results for regional production areas in South Africa show that during the simulation period the area under Valencias increases strongly whereas the area under Navels decreases. A comparison with a scenario without any EU tariffs was carried out to estimate the total distortion effect of EU protection on the South African market. Both South African consumers and producers benefit in the scenario without EU tariffs. The results of the simulation indicate that the total effect of EU tariffs is relatively small. Predicted total South African orange production increases by 14.8 percent over the simulation period compared to 9.1 percent in the scenario without any preferential treatment. The difference in other results is even smaller. The FTA reverts only parts of the distortion effect of EU protection. There are still some further possibilities to reduce the effects of EU protection on the South African fresh orange industry.
Appropriate institutional and contractual arrangements for the marketing of organic crops produced by members of the Ezemvelo Farmers' Organisation in KwaZulu-Natal.
(2010) Gadzikwa, Lawrence.; Lyne, Michael Charles.; Hendriks, Sheryl Lee.
The Ezemvelo Farmers’ Organisation (EFO) is a certified organic smallholder group in KwaZulu-Natal province (South Africa) that exists as an institution to improve smallholder access to niche markets by reducing unit production and transaction costs. The study is motivated by the need to understand drivers of collective action, prevalence of internal group free-riding, and the impact of contract terms on contract performance. These three theoretical concepts are pertinent in understanding organisational and institutional issues affecting the performance of smallholder organic farming groups and in formulating policies to promote the performance of such groups. The study relies on the theoretical foundations of collective action, free-riding and contracts found within the realm of New Institutional Economics (NIE). These theories, though separate, are in fact related in certain respects. Collective action in smallholder groups, apart from being a function of a plethora of socio-economic factors, including transaction costs, could be constrained by free-riding within the group, which in turn could be influenced by flawed contractual arrangements. This study of collective action focuses on 200 farmers drawn from a sample survey of 49 non-EFO members, and a census survey of 103 partially certified and 48 fully certified EFO members. A ‘collective action’ model investigates the impact of perceived benefits and savings on production and transaction costs attributed to collective action by drawing comparisons between EFO members and non-members using a multinomial logit model. The study of free-riding uses data from 151 members of the EFO to construct an index of free-riding within the group using principal components analysis (PCA). A ‘contract model’, which also focuses on EFO members only, attempts to measure the impact of verbal contract provisions on contract performance in addition to evaluating the determinants of preferred contract terms using a combination of PCA, Ordinary Least Squares (OLS) regression, and logit models. Results indicate that continued participation in EFO is not influenced by the age or gender of the farmer, but positively influenced by growth in the net benefits of participation, and negatively by an increase in the size of the household’s cropland or on-farm earnings. With respect to production and transaction costs, the results suggest that EFO has reduced fully certified members’ concerns that crops would be damaged by livestock or constrained by inadequate technical information. However, this is not the case for other problems such as price uncertainty in conventional markets, a lack of affordable operating inputs, a lack of affordable transport, and a lack of communications infrastructure. The index of free-riding behaviour constructed using principal components analysis suggests that free-riding poses a serious threat to EFO’s collective marketing efforts. Ordinary Least Squares regression analysis of the index scores shows that members who are male, poorly educated, partially certified, aware of loopholes in the grading system, and who do not trust the buyer are more likely to free-ride. Benefits accruing to EFO members are limited and there is substantial confusion among members about the terms of EFO’s verbal contract with the pack house that purchases their organic produce. Ordinary Least Squares regression analysis of the impact that perceived contractual terms have on quantities delivered to the pack house yielded interesting findings. Perceptions that delivery calls are made by the buyer, that grading procedures are flawed and that prices are not jointly established were found to reduce quantities delivered to the pack house, after controlling for differences in farm and farmer characteristics. Logit models estimated to identify the determinants of preferred contract clauses indicate that farmers with higher levels of formal education and farm income, and lower levels of experience, favour a written contract over a verbal contract. Similarly, farmers with higher levels of formal education and lower levels of family farm labour favour a contract denominated by area rather than weight. It is concluded that EFO should recruit households that rely on farming for income and which are land constrained. EFO is more likely to survive if it continues to secure fully subsidised information, transport, fencing, and certification services for its members, and if it improves the benefits of participating by synchronising harvest and delivery dates, negotiating price discounts for organic inputs, and by maintaining an office with telephone, fax and postal services. In the longer-term, EFO should address institutionalised free-riding by issuing tradable ownership rights. In the short-term, EFO must engage with the pack house (buyer) to remove flaws in the grading process that conceal the origin of low quality produce. Transparent and mediated negotiations leading to an incentive compliant contract with the buyer may also help to build trust and reduce free-riding within EFO. It is also recommended that the terms of EFO’s contract with the pack house should be revised so that; (a) delivery calls can be made by either the pack house or by EFO during specified periods and with reasonable notice, and (b) grading procedures are fully transparent and ensure traceability so that losses caused by poor quality can be internalised to members who deliver inferior produce. In addition, it is important that prices be negotiated at the beginning of each season and that the contractual parties have recourse to pre-agreed facilitators and an arbitrator to resolve disputes on price and quality. A written contract is recommended to support these more complex terms, with the proviso that the contract is explained to current and prospective members, and that growers are fully informed of their rights and obligations.
An assessment of the maize structure, channel choice and market participation by the smallholder maize farmers in Zimbabwe: a case of Mazowe district=Ukuhlolwa kwesakhiwo semakethe yommbila, ukukhethwa komgudu kanye nokubamba iqhaza emakethe ngabalimi abancane bommbila eZimbabwe: ucwaningo ngesifunda saseMazowe.
(2023) Munyati, Vincent Tinashe.; Mudhara, Maxwell.; Sinyolo, Sikhulumile.
Marketing plays a crucial role in alleviating poverty, as well as in achieving food security and sustainable development goals, especially among smallholder maize farmers. Maize marketing has the potential to improve the resilience of households against food insecurity, which is caused by multiple factors which may be natural factors, socio-economic and institutional factors. Smallholder maize farmers find it difficult to participate in the maize market because of a range of limitations, such as poor transport facilities, information asymmetry and the lack of a market infrastructure, which reduces their motivation to partake and which may be echoed in concealed expenses that make it challenging to enter the markets and productive resources. This study ascertained the factors that determine the likelihood and intensity of smallholder maize farmers participating in the maize markets, and it also assessed the market choices made by the smallholder farmers in the Mazowe District of Zimbabwe and analysed the maize marketing structure and its effects on the maize marketing performance. Questionnaires were used to collect data from 382 smallholder farmers and 27 agro-dealers in the Mazowe District. The study adopted a mixture of tools for data collection, including a questionnaire, observations and discussions. The Heckman Selection Model was used as the main analytical tool to estimate market participation and the intensity of this participation, while the Multinomial Logit Model was used to assess the market choices of the farmers and the Herfindalf-Hirschman Index and Gini coefficients were used to measure the concentration of maize traders in the Mazowe District. Due to the narrow index of the maize marketing options in the country, only three distinct alternatives were isolated, namely, the farm gate, the local market and the Grain Marketing Board (GMB), a government parastatal. The results indicated the significant factors that were associated with the likelihood and intensity of the farmers’ market participation, namely, the age of household head, the number of maize buyers at the district level, their extension contacts, membership of a marketing association and the distance to the output market. Contrary to the apriori expectations, the distance to the market had a positive and significant impact on their intensity to participate in the maize market. Other factors that significantly influenced the market choice selection of the smallholder farmers were the age of household head, the extension contacts, market information, the distance to the market and the price offered to maize producers at the market. The number of visits by extension workers significantly increased the likelihood that a maize producer would sell his produce at the local market, rather than at the farm gate. The distance to the market significantly influenced the probability of choosing the local market over the farm gate. As the distance to the local market increases, the smallholder farmers in the Mazowe District preferred the farm gate for selling their produce. In this study, the popular marketing channel for the smallholder farmers was the farm gate; although the prices offered here were often not competitive, the farmers opted for it because of the low transaction costs. The results also indicated that the number of buyers in the maize grain market is too small to make it competitive. The few traders exhibited collusive behaviour with regard to price-setting. The local market channel and G.M.B had a lower Shepherd Marketing Efficiency Index. While both indices were low, when they were compared to the standard in literature, the GMB channel was the least efficient. Most farmers indicated that selling their grain to the GMB involved bureaucracy and late payments, which have negatively affected the marketing efficiency. These late payments have short-circuited the ability of small-scale farmers to generate a cash-flow with which to fund their agriculture activities. The study recommends that there should be mechanisms for developing the capacity of farmers to access marketing information, in order for them to make an informed decision regarding which marketing channel to choose. Governments need to think about how to help smallholder maize farmers to engage better with the existing profitable market channels. Being a member of an association increases the probability of a farmer selling to more lucrative markets. Farmer groups have the advantage of bulking and hence increasing the economies of scale. There is need for farmers to invest more in collective action. It is also easier and cheaper for traders to enforce quality and grade requirements by reaching farmers groups, rather than individual farmers. Iqoqa Abalimi bommbila abancane bakuthola kunzima ukubamba iqhaza emakethe yommbila ngenxa yohlu lwemikhawulo, njengezindawo zokuthutha ezingezinhle, ulwazi olungaxhumani, kanye nokuntuleka kwengqalasizinda yemakethe, okunciphisa ugqozi lwabo lokuhlanganyela futhi okungase kuzwakaliswe ngezindleko ezifihliwe ezenza kube yinselela ukungena ezimakethe kanye nezinsiza ezikhiqizayo. Lolu cwaningo lwaqinisekisa izinto ezinquma amathuba nokujula kwabalimi bommbila abancane ababambe iqhaza ezimakethe zommbila, lwaphinde lwahlola ukhetho lwemakethe olwenziwe ngabalimi abancane eZimbabwe. IHeckman Selection Model yasetshenziswa njengethuluzi eliyinhloko lokuhlaziya ukulinganisa iqhaza lemakethe kanye nokujula kwalokhu kubamba iqhaza, kanti iMultinomial Logit Model yasetshenziselwa ukuhlola ukukhetha kwemakethe futhi iHerfindalf- Hirschman Index yasetshenziselwa ukulinganisa ukuhlanganiswa kommbila. Ngenxa yenkomba encane yezinketho zokumaketha ummbila, kwatholakala izindlela ezintathu kuphela ezihlukile, okungukuthi, isango lepulazi, imakethe yendawo kanye neBhodi Lokumaketha Okusanhlamvu. Imiphumela ikhombise izinto ezibalulekile ezihambisana namathuba nokujula kokubamba iqhaza kwemakethe yabalimi, okungukuthi, iminyaka yenhloko yasekhaya, inani labathengi bommbila ezingeni lesifunda, abaxhumana nabo ukwandisa, ubulungu benhlangano yokumaketha kanye nebanga eliya emakethe yokudayisa. Imiphumela ikhombise ukuthi inani labathengi emakethe yommbila lincane kakhulu ukuthi lingayenza ibe nokuncintisana. Ucwaningo luncoma ukuthi kufanele kube nezindlela zokuthuthukisa amandla abalimi okuthola ulwazi lokumaketha, ukuze benze isinqumo esinolwazi mayelana nokuthi yimuphi umgudu wokumaketha okufanele bawukhethe. Ukuba yilungu lenhlangano kwandisa amathuba okuthi umlimi athengisele izimakethe ezinenzuzo. Kunesidingo sokuthi abalimi batshale imali eningi esenzweni esihlangene. Kulula futhi kushibhile kubathengisi ukuphoqelela izidingo zekhwalithi nebanga ngokufinyelela emaqenjini abalimi, kunabalimi ngabanye.
Climate change perception, crop diversification and land use change among small-scale farmers in the Midlands region of KwaZulu-Natal, South Africa : behavioural and microeconomic analyses.
Hitayezu, Patrick.; Zegeye, Edilegnaw Wale.; Ortmann, Gerald Friedel.
The future of small-scale agriculture in South Africa is facing the challenges of high population growth, land degradation, and agro-biodiversity loss. In the Midlands region of KwaZulu-Natal (KZN), the challenges are exacerbated by climate change (CC). Agricultural land use change (ALUC) is among farm-level options to exploit the synergy between local adaptation and global mitigation of CC, whilst restoring degraded lands and agro-biodiversity reservoirs. The literature contends that the pathways to climate-resilient sustainable land use start with the farming sector’s vulnerability to CC, and translate into behavioural change through farmers’ perceptions about the climate risk. Two major steps characterize behavioural response to changing distributions of weather patterns. Behavioural responses to CC begin with reducing the vulnerability to climatic variability (e.g. by using tactical adjustments such as crop diversification), followed by forward-looking integration of adaptation and mitigation into farm planning (e.g. through ALUC). The purpose of this study was to provide a systematic and detailed understanding of climate-driven ALUC in the setting of small-scale farming in South Africa. Taking the Midlands region of KZN as an illustrative case, this study aimed (i) to explore some meso-level aspects of climate-related agricultural vulnerability; (ii) to investigate the perceptions of small-scale farmers about CC and their socio-psychological, institutional and cultural determinants; (iii) to analyse the farmland use systems and assess the microeconomic determinants of seasonal crop diversification; and (iv) to assess the attitudes of small-scale farmers towards land use and the constraints governing ALUC decision-making. To assess the meso-level vulnerability of farming sector to CC in the Midlands region of KZN, an indicator approach was adopted. Various aspects of exposure, sensitivity and adaptive capacity of the farming sector were explored using a systematic review of available empirical evidence. The review suggested that the farming sector is exposed to a warming and wetting climate. The reviewed evidence also suggested that the farming sector is highly sensitive to CC due to high population densities, high rates of small-scale farming, low irrigation rates and susceptibility to land degradation. Nevertheless, diversified crop portfolios remain a major aspect of resilience among small-scale farmers. The reviewed evidence further indicated that farmers’ adaptive capacity is confounded by inadequate access to infrastructure, rural exodus, skills shortages, poor health status, and low level of social capital. The remaining objectives were empirically investigated based on primary data from a household survey of 152 small-scale farmers in the uMshwati local municipality. With regard to the second objective, a principle component analysis (PCA) of eight variables of perceived seasonal climatic abnormality yielded two dominant perceptual shapes. CCP1 score captured the extent to which an individual farmer perceives the winter season as cooling and the summer season as warming and drying. CCP2 score captured the extent to which an individual farmer perceives the winter season as warming and wetting, and summer season as drying. The results of a Double-Hurdle (DH) model showed that the probability of perceiving abnormal trends in the local seasonal climate increases with holistic affect, egalitarian worldviews, age, female-headedness and hilly and wetter agro-ecological regions, and decreases with education. The model results also showed that the CCP1 score increases with holistic affect and other factors related to personal experience such as age and distance to the river, signifying experience-based learning. The results further showed that CCP2 score increases with cognitive ability (knowledge) and related socio-demographic factors such as education, extension and trust, indicating analytic processing of climate information. With regard to the third objective, a two-stage cluster analysis of land use data unveiled a diversified farmland use matrix characterised by a maize-beans inter-cropping system coexisting with of mixed crop-livestock, sugarcane and timber mono-cropping systems. After accounting for potential endogeneity biases, the results of a logit transformation model showed positive effects of labour and landholding on the intensity of multiple-cropping among poorer and richer households, suggesting that responding to technological constraints is an important driver of seasonal crop diversification. Furthermore, the results showed that the intensity of multiple-cropping among richer households decreases with education due to faster shadow wage rise at higher farm assets position. Among poorer households, the intensity of crop diversification decreases with off-farm occupation and increases with distance to water sources, suggesting that mitigating income and production risks are key motivations for crop diversification. Regarding the fourth objective, the results of a Mixed-multinomial Logit model that accounts for potential endogeneity biases showed that the decisions about ALUC from seasonal crops towards forestry or sugarcane cultivation are rationally derived and driven by clear but heterogeneous preferences and trade-offs between crop productivity, food security, and labour requirements. These motivations override income generation and ecological sustainability incentives, the common policy foci in South Africa. The model results also indicated that the utility of planting sugarcane increases with size of landholding, suggesting economies of size. The preference for forest plantation decreases with household size, a Chayanov-like afforestation pattern. Furthermore, the results indicated that the preference for ALUC increases with the proportion of ALUC in the community/ward (suggesting peer group influence) and hilly and wetter agro-ecological conditions (due to higher land conversion cost and acute soil erosion). The empirical findings of this study pointed to the need for designing a region-specific CC communication strategy that involves affected farmers and locally trusted agricultural extensions agents, and aligns the information content to local beliefs, values and norms. The findings also inferred that reduced agro-biodiversity loss and enhanced resilience in the face of the increasing climatic variability through crop diversification could be major co-benefits of the ongoing land reform, and explicit strategies should focus on regions with widespread poverty and dryland farming. For supporting ALUC towards farmland afforestation, the findings advocated the promotion of timber-based agroforestry systems as an effective strategy to align public goals with private incentives. The findings further advocated incentive-based afforestation schemes (such as payment for ecosystem services) designed on a per-capita or equivalent-consumption basis and targeting farms located in regions with steeper slopes and higher climate variability.
Determinants of herd productivity in Botswana : a focus on land tenure and land policy.
(2006) Mahabile, Meck.; Lyne, Michael Charles.; Panin, Anthony.
This study attempts to identify factors responsible for determining differences in the productivity of cattle managed by communal and private livestock farmers in the southern region of Botswana during 1999/2000. It is hypothesised that herd productivity and investment in southern Botswana are higher on private ranches than on open access communal grazing land. This study is important because livestock, especially cattle, contribute significantly to the livelihood of farmers in Botswana. Cattle are a major source of meat, milk and draught power, and provide a store of wealth that protects against inflation and which can easily be converted into cash. Cattle production is also an important source of employment in the rural economy of Botswana. Furthermore, the export of beef is a major source of foreign exchange earnings, and cattle account for 80 percent of agriculture's contribution to Botswana's gross domestic product. A stratified random sample survey of communal and private livestock farmers was conducted in the southern region of Botswana from August 1999 to May 2000 with the assistance of four enumerators. The sample survey data were used to compute descriptive statistics and to estimate the parameters of a block recursive regression model. The model postulated relationships between agricultural credit, investment in fixed improvement, investment in operating inputs and herd productivity. Some of the equations are estimated with Ordinary Least Squares (OLS) and some with Two-Stage Least Squares (2SLS) to account for likely correlation between endogenous explanatory variables and the error term. Descriptive statistics show that levels of investment and herd productivity are higher on private farms than on open-access communal grazing. Private farmers are also better educated, more liquid, and have larger herd sizes, but do not differ from their communal counterparts in terms of age, gender, race or household size. The regression results show that (a) respondents with secure tenure and larger herds use more agricultural credit than those who rely on open access communal grazing land to raise cattle; (b) secure land tenure, higher levels of liquidity and use of long-term credit promote investment in fixed improvements to land; (c) liquidity from short-term credit and wage remittances supports expenditure on operating inputs; and (d) herd productivity increases with greater investment in fixed improvement and operating inputs. Herd productivity is therefore positively (but indirectly) influenced by secure land tenure. It can therefore be inferred that government should (a) uphold private property rights to land where they already exists; (b) privatise open access grazing to individual owner operators where this is politically, socially, and economically feasible; and (c) where privatisation to individuals is not feasible, government should encourage users to convert the grazing into common property by subsidising the costs of defining user groups and the boundaries of their resources, and enforcing rules limiting individual use of common property. This first-step in a gradual shift towards more secure tenure should be followed by the conversion of user groups to non-user groups organized along the lines of investor-owned firms where members exchange use rights for benefit and voting rights in a joint venture managed by an expert.
Distortion of incentives for farm households in KwaZulu.
(1989) Lyne, Michael Charles.; Nieuwoudt, Wilhelmus Liberté.
KwaZulu is a less developed region of South Africa. Low agricultural incomes have contributed to widespread poverty in the region. Despite intense population pressure on the land, arable resources are underutilized. Conversely, grazing resources are overutilized. Tribal tenure prevents the sale of land and has also precluded an active land rental market. Population growth has reduced farm sizes because households have an incentive to retain their rural land rights. At the same time, the opportunity cost of household farm labour has increased. As a result, the average cost of producing crops has risen relative to product prices. Households are generally able to procure food and income at lower cost by allocating better educated workers to urban wage employment. Consequently, many households have little incentive to produce crops and are deficit food producers. Arable land is underutilized because these households cannot rent land to others who would farm it. A mathematical programming model constructed from models of representative households demonstrates that output responses to higher food prices and reduced input costs are small. Furthermore, an increase in food prices harms most rural households and lower input costs do little to improve household welfare. However, the model predicts that a land rental market will have a substantial impact on crop production and could generate significant income opportunities in agriculture and its service industries. A rental market for arable land would require minor institutional changes and has equity as well as efficiency advantages. The uncultivated portion of a household's tribal land allotment is regarded as common property for grazing purposes. Access to these grazing resources is not restricted and an empirical analysis of herd data indicates that stocking rates decline when the private cost of keeping cattle increases relative to their perceived benefits. Unlike most 'solutions' to the common property problem, privatization of grazing land would not only reduce overstocking and its associated social cost, but would also improve incentives to upgrade herd and pasture quality. It is recommended that privatization of grazing land (even in the limited sense that arable land is privately controlled) should be encouraged.
Economic analysis of supermarkets as a marketing channel choice for fresh produce smallholder farmers in Eswatini.
(2020) Dlamini-Mazibuko, Bongiwe Porrie.; Ferrer, Stuart Richard Douglas.; Ortmann, Gerald Friedel.
The growth of supermarkets in Eswatini has been dominated by South African supermarket chains that typically have access to established procurement channels from South Africa. Whilst some supermarkets do procure some fresh produce from local farmers, others exclusively procure from South Africa. This facilitation of market access for imported fresh produce in Eswatini – a threat for local farmers - differentiates this study from previous research on the impacts of supermarkets on farmers in developing countries. In particular, supermarket requirements imposed on producers in conjunction with competition from imports has important implications for local farmers’ direct access to these markets, the types of fresh produce procured, and the relationships formed, which therefore, impact on farm incomes of smallholder farmers in Eswatini. Therefore, the primary objectives of the study are to show the procurement system of vegetables in Eswatini as a complex system; analyse the nature of the farmer-buyer relationships; determine the factors affecting the choice of marketing outlets; and estimate the impact of supermarket participation on income of smallholders in Eswatini. The study focused on the procurement of fresh produce, namely cabbages, spinach and lettuce from Hhohho and Manzini, where the majority of supermarkets in Eswatini are located. A combination of sampling methods has been used in the study. A random sampling method was used to select a sample of 110 smallholder farmers supplying vegetables to traditional markets and NAMBoard, (a parastatal that, amongst other functions, assists farmers with production, processing, storage, transportation, distribution of their produce and the sale of scheduled products) and about 60 smallholders were supplying supermarkets. Informants from the vegetable supply chain were purposely selected with the view of being directly and indirectly, involved in the chain. The thesis is structured as four research papers that address the above-stated objectives. The first research paper examines the procurement system of vegetables in Eswatini as a complex system using the Theme Network Analysis (TNA). TNA allows for the identification of linkages of key themes associated with the procurement of vegetables by formal markets and other pertinent themes that can be further investigated for solutions to the system. In the second paper, factor analysis and discriminant analysis were used to determine farmer-buyer relationships between informal and formal marketing channels based on relationship satisfaction, trust and commitment. Results from the discriminant analysis revealed that there is a statistical significant difference between formal and informal marketing channels, and those farmers supplying formal markets perceived levels of satisfaction, trust, and commitment better than for informal markets. The third research paper involved the application of the Multivariate Probit (MVP) model to estimate the factors influencing the choice of marketing outlet selection strategies. The marketing outlets observed were supermarkets, NAMBoard and traditional markets, and the results showed that these outlets were substitutes. This implies that when it comes to marketing outlet selection, farmers would select one outlet over the other based on economic and practical factors; if the conditions for supplying one market outlet are inaccessible for smallholders, another market will be selected. The selection decision is influenced by risk attitude, assets ownership, institutional variables, transaction costs and market attributes. Lastly, the fourth paper involved the application of the Endogenous Switching Regression model to determine the factors influencing participation in supermarkets and the effect participation has on income of suppliers. The results revealed structural differences between farmers supplying supermarkets and traditional markets, particularly with respect to the size of the farm and off-farm income. The result also revealed that smallholders supplying supermarkets earned a relatively higher income than those supplying traditional participants. The main conclusions of the study are as follows: the characteristics of supermarkets and farmers, as well as the nature of the product, add to the complexity of the procurement system. The TNA enhanced the understanding of the identified issues contributing to the complex procurement systems; hence, strategies for improvement can be investigated. The key challenges identified were inconsistent supply of produce, lack of finance, and transport, high procurement requirements and high transaction costs. The social responsibility approach that supermarkets use for smallholders is attributed to these procurement challenges, which means that buying from local smallholders is not one of the business strategies for retailers. Therefore, policy regulations set to limit imports and encourage domestic procurement while developing smallholders to be able meet procurement requirements are necessary. The introduction of such policies may reduce imports, which are regarded as a threat to local farmers. Secondly, the nature of the buyer-seller relationships between the marketing channels is discrete, which is characterised by flexibility and lack of commitment between farmers and the buyers. The factors affecting the choice of marketing outlets and the effect on supermarket participation are crucial for the sustainable growth of smallholder vegetable farmers in Eswatini. The farmers’ risk preference, different assets owned, institutional factors, and the duration the marketing outlet takes to make payment for produce influence supermarket channel selection decisions. The implications of these results (factors) provide empirical guidelines necessary for farmers when selecting marketing channels. Policies aimed at the commercialization of smallholder farmers involving the establishment of institutions and the acquisitions of assets such as the provision of education (skills training), improved market information, extension services, mobile phone, transportation and farm size to produce marketable surplus are critical for the improvement of supermarket participation leading to improvement of farmers’ income. The study, therefore, recommends a coordinated and comprehensive supply chain approach, which will enhance a broader understanding of the vegetable marketing system and the achievement of a mutually beneficial relationship that will enhance smallholder farmers’ access to markets and further improve their household welfare from income earned from participating in these markets.
Economic analysis of crop production in Lesotho : a household-based programming approach.
(1995) Mokitimi, None Raletsema.; Nieuwoudt, Wilhelmus Liberté.
Agriculture in Lesotho is a key sector and a major source of employment within the country, with approximately 85 percent of the population living in rural areas. Crop farming is characterised by a high proportion of subsistence farming with most production being kept for home consumption. Lesotho's agriculture has shown declining production despite government intervention in the form of area-based development projects and massive international aid. Approximately 40 percent of Lesotho's male labour force is, at any time, engaged in employment in the Republic of South Africa (RSA) as migrants. Migrant workers' remittances account for approximately 50 percent of GNP. Agriculture as the main source of income has decreased substantially while dependence on migrants' remittances and foreign aid has increased. The purpose of this study is to identify factors affecting crop production in Lesotho and to analyse different economic policies on resource allocation. The study applies household economics theory which recognises the fact that most farm households in developing countries are deficit producers and as such are engaged in both production and consumption, this being the situation in Lesotho. The purpose of the study was achieved by using a mathematical programming model to predict responses to several economic policies. The programming model aggregates enterprise levels for four representative household types to form a sector model. Representative farm households were selected using principal component and cluster analyses. Aggregate resource levels in each household type were computed as the product of the representative (mean) household resource levels and the estimated number of households in the group. Data were obtained from a sample survey of 160 crop producing households located in northern Lowlands and Foothills of Lesotho. To account for risk, a linear approximation of the gain-confidence limit (E,L) criterion suggested by Baumol (1963) was used. Risk aversion coefficients were estimated independently for each representative household by simulating its observed enterprise mix. To account for differences in wage earning potentials, offer wage rates were estimated for all household members not wage employed. Offer wage models predicted that men have a higher wage earning potential than women. Results of the offer wage models indicate that people wage employed within Lesotho are relatively more educated than those employed as migrants in RSA. For those wage employed within Lesotho women tend to be more educated than men. Several economic policies were simulated and results compared with the base solution. Most of the policies examined focus on maize prices because maize is the most important staple food in Lesotho and changes in its price are expected to affect rural households' resource allocation and welfare. Results from a household-based programming model indicate that even though agriculture is the key sector in Lesotho, Basotho households are more responsive to consumer than producer prices. This is attributed to the fact that the majority of rural households are net consumers of maize. Deregulation of the RSA maize marketing system is expected to lead to lower maize import prices which is simulated to increase household welfare as the majority of households are net consumers of maize. This deregulation is also expected to result in reduction in maize production in Lesotho and increased wheat production and fallow land. There is an increase in maize imports, a decrease in maize self-sufficiency but households' affordability to purchase maize improves thus enhancing food security. A simulated increase of 10 percent in maize producer prices with maize consumer prices held constant, does not have any effect on crop production. Simulations of the model indicate that maize producer prices have to be increased by over 100 percent in order for households to produce maize for market purposes. This shows that most of agricultural production in Lesotho will remain for subsistence even under relatively high maize prices. A reduction in workers wage employed in RSA and Lesotho is simulated to have little impact on crop production but has a significant negative impact on household welfare. An interest rate subsidy aimed at farmers operating under the Food Self-Sufficiency Programme (FSSP) has almost no effect on household welfare and leads to an increase in FSSP maize production and this results in minimal increases in total maize production. Results also indicate that land rental arrangements can lead to increased production but transaction costs exceed the rental value and this has resulted in the non-existence of a land rental market in Lesotho.
Economic analysis of determinants of grain storage practices and implications on storage losses and household food security in Makoni and Shamva Districts in Zimbabwe.
(2017) Chuma, Teresa.; Mudhara, Maxwell.; Govereh, Jones.
Despite notable advances in grain storage practices, many smallholder farmers in southern Africa still rely on traditional practices for storing staple crops such as maize. Traditional storage practices do not offer adequate protection of grain against pests such as the Larger Grain Borer (LGB) hence significant post-harvest losses (PHL) are recorded in storage. More so, little attention has been given to the study of the economics of PHL and storage technology, particularly in the smallholder farming areas where issues of food security and poverty are concentrated. This study meant to compare the economic viability of traditional and improved storage technologies, examine the factors that influence smallholder farmers‟ choice of storage technologies, analyse determinants of willingness to pay for a metal silo, and determine the effects of storage technologies on household hunger gap and market participation in Zimbabwe. A structured questionnaire was used to collect data from 417 households chosen using the multi-stage sampling method in Makoni and Shamva Districts. Various econometric methods such as cost-benefit analysis, multinomial logit, logit, ordered probit and truncated regression models were used to analyse the data. Storing maize grain using hermetic technologies was found to be most profitable when compared to untreated and ACTELLIC dust (pirimiphos-methyl) treated polypropylene bags. The benefit-cost (B/C) ratios were also greater for hermetic technologies. Comparing the two hermetic technologies, the super grain bags were found to be more profitable than the metal silo. Nevertheless, both technologies were superior to the smallholder farmers‟ storage technology of treated bags. Sensitivity analysis results, on the other hand, revealed that both hermetic storage technologies are sensitive to reduction in investment period. This is a result of the high investment costs that are associated with the technologies. The results, however, indicated that super grain bags are more suitable for smallholder farmers who are resource limited and cannot invest in a silo since super grain bags have a higher financial return than a metal silo. On the other hand, metal silos are the most suitable and robust storage technology for smallholder farmers who have long-term storage investment plans. It should, however, be noted that to create and keep gas-tight conditions in metal silos or super grain bags is a demanding and expensive task that requires pronounced scientific and technical skills. Dissemination of the technology should thus encompass farmer and artisan training package on proper handling and management of the hermetic technologies to reap maximum benefits from the inert atmospheres created. Provision of credit may be required to allow farmers to meet the high initial investment costs. Household head‟s age, education years, marital status, total grain stored, the value of non-food crops, business and wages income, and access to extension services were found to have a diverse influence on the choice of grain storage technologies. Older households had higher chances of using the insecticide storage technology indicating that farming experience influences the choice of grain storage technologies. Therefore, the government and development agents should target older household heads for promotion and dissemination of storage technologies. Marital status also increased the chance of using the insecticide storage technology suggesting that married household heads are less risk-averse. Therefore, government and storage technology development agents should target married households for dissemination, without marginalizing unmarried household heads. Furthermore, the total grain stored influenced smallholder farmers to use the insecticide storage technology versus the no insecticide technology. Thus, policies that promote agricultural production will enhance the use of improved storage technologies among smallholder farmers. Hence, the government should support agricultural production activities of smallholder farmers. Thus, policies that promote agricultural production will enhance the use of improved storage technologies among smallholder farmers. Hence, the government should support agricultural production activities of smallholder farmers. Households with a higher value of non-food crops showed higher chances of using the insecticide storage technology relative to the no insecticide technology. Hence, development agents and the government should develop programs that support the production of non-food crops in smallholder areas without side-lining maize production. Results showed that better-educated smallholder farmers had higher chances of using the insecticide storage technology. The government should develop adult learning programs in the areas to increase access of farmers to education. However, smallholder farmers with income from business and wage activities showed less likelihood to use the insecticide storage technology. This implies that such smallholder farmers have fewer chances of storing grain hence are more likely not to choose the insecticide storage technology. Although access to extension had a negative influence on the choice of storage technology, it is important that government develops specific extension training programs on storage technology particularly the use of insecticide storage so as to equip farmers with proper storage skills and information. In terms of farmers‟ willingness to pay for a metal silo, the results found that the household head‟s age, marital status, non-food crop quantity, equipment value, vegetable income, storage loss and informal activity participation were the key determinants of willingness to pay for a one-tonne metal silo storage technology in Zimbabwe. The results revealed that married respondents and young farmers are more ready to pay for metal silos than their counterparts. While it is recommended that development agents promoting the metal silo technology should target these households for a sustainable approach, care should be taken not to marginalize their counterparts. All the income variables except equipment value showed a positive influence on WTP for a metal silo. Increasing household‟s income will help to ease the financial constraints that often impede technology investment among smallholder farmers. Therefore, policies that encourage diversification of agriculture and also provision of credit are recommended in order to increase WTP for a metal silo. The amount of grain lost in storage had a positive influence on farmers‟ WTP for a metal silo. This suggests that current storage practices are not effective against storage losses and the metal silo can be an alternative effective storage to curb storage losses and hence improve their food security and livelihoods. The study results revealed that storage practices had significant effects on both maize marketing behaviour and hunger gap of smallholder farmers. The use of insecticide storage increased the chances of farmers becoming net sellers of maize. Using insecticide storage reduces the amount of grain that is lost in storage hence farmers are able to preserve the amount of grain available for consumption and also for sale. This implies that safe storage of maize promotes smallholder farmers‟ net maize selling behaviour thus reducing poverty and also contributing to improved food security. Investment in safe grain storage technologies is thus a fundamental key policy issue in developing countries and as such government should design storage policies that encourage dissemination and promotion of safe grain storage technologies at the household level. Household head‟s gender, marital status, quantity harvested, market location, farming systems and district location were other factors that influenced maize marketing decisions of smallholder farmers in Zimbabwe. Moreover, results showed that the majority of the households experienced hunger gap. On average, households that experienced it had a hunger gap intensity of 4.7 months. This means that food insecurity is an issue of concern among smallholder farmers. Policymakers should come up with effective measures to safeguard lives of people either by boosting production or promoting safe storage of maize grain. Several household socio-economic characteristics such as age, household size, gender, marital status, location, education years, and being an A1 model or old resettlement farmer and no treatment storage significantly influence the occurrence of household hunger gap. Farmers who used no treatment on stored grain had better chances of not incurring hunger gap in the study areas. Hence, there is need to investigate the location-specific characteristics of smallholder farmers. The government may also develop programs targeted to improve post-harvest knowledge and skills of smallholder farmers. Smallholder farmers record significant storage losses which lead to the hunger gap. Protecting grain crops is thus an important step towards ensuring food security. Larger household size increased chances of experiencing hunger gap, which suggests the need to implement effective family planning methods to keep the family sizes small. Development agents should provide effective family planning education and training to farmers in the rural areas. Farmers who had larger sizes of cultivated land showed lower chances of experiencing hunger gap than their counterparts. Therefore increasing smallholder farmers‟ access to land will alleviate the problem of hunger gap and food insecurity. Households with a higher level of education had lower chances of incurring hunger gap, therefore, the government should develop adult learning programs to increase literacy levels of households in the area and hence reduce hunger gap occurrence. It was also observed that hunger gap differs by location, farming system, and storage practices. Farmers in Shamva district showed higher chances of experiencing a hunger gap than those in Makoni district, while farmers in the A1 model and old resettlement schemes had better chances of incurring no hunger gap. These farmers have better access to land, and other productive resources thus lower chances of incurring hunger gap. Hence, government supported input schemes should target areas where farmers have less access to inputs so as to improve productivity. On the other hand, the quantity of grain harvested, total grain stored, income from business and wages and land size had a negative effect on hunger gap intensity while hunger gap intensity increased if the household head was married and no insecticide storage technology was used to store maize grain. To sum up, the study, recommends that government should develop policies that encourage farmers to invest in improved storage technologies such as the hermetic metal silo, and also to provide credit to farmers to enhance adoption and dissemination of new improved storage technologies. The study further recommends that government should develop effective extension programs tailor-made to increase and improve smallholder farmers' post-harvest management knowledge and skills, respectively.
An economic analysis of smallholders’ heterogeneity and the impact of Jatropha curcas cultivation on household welfare in the Mangochi district, Malawi.
(2021) Chamdimba, Owen Yoram.; Ortmann, Gerald Friedel.; Zegeye, Edilegnaw Wale.
The renewed interest in biofuels among many countries globally is on account of potential increased energy security, environmental and rural development benefits. Biofuels development in Malawi has the potential to achieve these objectives. The agricultural sector is the engine of the economy. Tobacco, the current primary foreign exchange earner, faces dwindling revenues from anti-smoking campaigns. Smallholders are also affected by various shocks, including weather variation, which increase vulnerability to food insecurity. There is no doubt that Malawi needs to diversify its economy to mitigate shocks and improve rural livelihoods. The Malawi government recognises, among other strategies, increased use of renewable energy sources, increased agricultural productivity, and diversification as its key priority areas. The smallholder out-grower biofuels production schemes deliver on two key government priority areas as renewable energy sources and crop diversification with the potential to open new markets, create rural jobs, and improve livelihoods. Generally, research on energy crops in Malawi is thin. The nexus of livelihood, food security, and biofuels production has not been examined in Malawi. Thus, this study aims to: (1) identify sources of smallholder heterogeneity and farmer typologies among energy crop producers, to inform livelihood improvement interventions in Southern Malawi; (2) analyse the determinants and the impact of Jatropha curcas cultivation on resilience to food insecurity shocks among smallholders, and (3) examine the welfare impacts of Jatropha curcas cultivation on smallholders in Southern Malawi. The study used cross-section data collected in 2014 using purposive and random sampling strategies from 298 smallholders in the Mangochi District of Southern Malawi. Mangochi District was chosen following reconnaissance survey results where Bioenergy Resources Limited (BERL), a consortium of Dutch Companies engaged in biofuels promotion in Malawi, was getting the bulk of Jatropha curcas seeds. The empirical research techniques employed include Principal Component Analysis (PCA), Cluster Analysis (CA), Endogenous Switching Regression model (ESR), Propensity Score Matching (PSM), and the Endogenous Treatment Effects (ETE) model. The multivariate analysis results identified five typologies that were generally distinguished by gender, asset holdings, labour endowments, level of agricultural input use, and output sales. The typologies exhibited various constraints and opportunities for livelihood improvement. Notably, more Jatropha curcas cultivating farmers, particularly female-headed households, belonged to typologies with low to medium resource endowments as compared to non-growers. There were variations in possible interventions across many of the typologies identified. Hence, interventions and strategies must target the identified typologies, where capacity is available to increase their impact and relevance. The portfolio of interventions identified range from human capital (extension), labour-intensive strategies such as work for inputs to social protection measures (safety-nets). The endogenous treatment effects model results showed that shocks, various capital assets, and institutional factors were significant determinants of resilience to food insecurity. Jatropha curcas cultivating farmers, particularly female-headed households, had significantly less resilience capacity to food insecurity compared to their counterparts. These results imply that policies and strategies that promote increased access to services and build people's capacity (such as institutional support to credit, quality education) should be given priority to increasing resilience to food insecurity. The findings of the propensity score matching and endogenous switching regression methods suggest that, when selection bias and endogeneity were accounted for, there were welfare benefits to smallholder Jatropha curcas feedstock producers. As such, there is a need for more empirical research on other potential biofuels to inform the Malawi biofuels policy in the future. In sum, the study has shown that biofuels are not a panacea that reduces rural poverty and improves the welfare of smallholders. Thus, future research must focus on developing and disseminating a portfolio of more profitable technology/practice packages for Jatropha curcas to contribute to rural household welfare. Furthermore, the study recommends policy efforts aimed at increasing resilience to food insecurity shocks. This could be achieved by increased access to credit, quality education, and strengthening climate forecasting capacity through research in climate models. Promotion of climate-smart agriculture practices is also recommended to reduce the impact of weather shocks. Where capacity is available, tailor-made interventions for livelihood improvement such as income or crop diversification, public works for inputs, and safety nets need to target specific groups based on smallholders' unique characteristics to account for heterogeneity.
An economic analysis of the demand for resources and the supply of output in South African agriculture.
(1970) Nieuwoudt, Wilhelmus Liberté.; Behrmann, Herbert Ian.
No abstract available.
An economic analysis of the impacts of monetary policy on South African agriculture.
(1990) Dushmanitch, Vladimir Yvan.; Darroch, Mark Andrew Gower.
A general equilibrium, simultaneous equations model was constructed to analyse the impacts of monetary policy on South African agriculture via the interest rate, exchange rate, inflation and real income. Annual data (1960-1987) were used to estimate equations representing the field crop, horticultural, livestock and manufacturing sectors, and the money and foreign exchange markets. The interest rate, general price level and exchange rate were determined endogenously to capture the effects of monetary policy on these variables. Macrolinkages whereby the impacts of monetary policy are transmitted to agriculture were simulated. Due to insufficient degrees of freedom, the final model was estimated by two-stage principal components. Dynamic simulations of an expansionary monetary policy suggest that such policy action has important implications for South African agriculture. In the short run, an increase in money supply causes the real interest rate to fall, general price level to rise and exchange rate to depreciate. Depreciation of the exchange rate and higher domestic inflation raise input prices. Increased cost effects of higher input prices outweigh the reduced cost effects of lower real interest rates causing real field crop and horticultural supply to decrease. Stock effects of lower real interest rates and cost effects of higher input costs impact negatively on livestock supply. The resultant decrease in real agricultural supply causes product prices to rise which lowers real per capita quantiy demanded for agricultural products. The net effect is a decline in total real gross farm income for the sectors modelled. Dynamic simulations of the separate impacts of changes in the interest rate, general price level and exchange rate on agriculture support these conclusions. Inflationary impacts of monetary policy changes were larger than interest rate and exchange rate impacts, which were generally similar in magnitude.
Economic factors affecting human fertility in the developing areas of South Africa.
(1990) Fairlamb, Cheryl Denise.; Nieuwoudt, Wilhelmus Liberté.
The World Bank has expressed concern over the high population growth rates in sub-saharan Africa. South Africa's annual population growth rate in the traditional sector is 2,9 percent. This study identifies the economic factors affecting family size choice to provide policy makers with a strategy for reducing fertility. A neoclassical utility framework was used to analyse linkages between family size decisions and socio-economic variables. Household utility for "child services" and "standard of living" was maximised subject to the resource constraints of time, labour and income. A stratified sampling technique was used to collect household data from Ulundi and Ubombo in KwaZulu. One hundred and seventy five women in three occupational strata were interviewed. A static demand function for children was estimated by multiple regression. The demand function was re-estimated within a simultaneous model of family decision making which was estimated by two-stage least squares regression analysis. Dummy dependent variables were estimated by probit analysis. Principal components analysis was used to confirm the underlying theoretical linkages and discriminant analysis was used to distinguish users from non-users of modern contraception. Results show that child education, woman's opportunity cost of time and formal labour market participation were negatively related to fertility reflecting a substitution from numbers of children (time intensive goods) to fewer, more educated children (less time intensive) as opportunity costs rise. Principal components confirmed that this substitution effect dominated the pure income effect as lifetime family earnings increased even though children are normal goods. Child labour and children's contribution to income were positively related to fertility. These benefits accrued mainly to rural people because in urban areas parents depend less on subsistence farming and essential services (water and electricity supply) are provided. Discriminant analysis showed that 47,7 percent of the respondents used contraception (including abstinence and sterility). The most important reasons for use were for child spacing and the desire for no more children. The latter reason was given by women who had completed fertility and young women who wanted to avoid untimely pregnancy. The actions of the young women emphasise the importance of opportunity cost which was further supported by positive relationships between woman's current income, child education and contraceptive use. Therefore strategies to reduce population growth rates should include improvements in education and employment opportunities which would raise time costs for women. Provision of time saving devices and essential services, and better pension and social security schemes would reduce the benefits from children thereby reducing family size. For better community acceptance of contraception, the benefits for child spacing and survival should be promoted.
The economic feasibility of producing ethanol from sugar-cane in South Africa.
(1985) Ortmann, Gerald Friedel.; Nieuwoudt, Wilhelmus Liberté.
The study is an evaluation of the economic feasibility of producing ethanol from sugar-cane in South Africa. With the depressed state of the sugar market and recent substantial increase (40% in January 1985) of liquid fuel prices linear patterns in South Africa, the study is of a topical nature. A regional linear programming model is used which simulates current production patterns in 22 areas of the South African Sugar Industry. The model incorporates demand functions for crops, substitution in demand between crops, supply functions for labour and variance-covariance matrices to account for risk in production. The model is used to evaluate the effects of alternative sugar policies, namely a pool scheme and a free market for sugar, with particular emphasis on ethanol production. Results show that the total ethanol cost (including opportunity cost) per litre in an industry producing one billion litres a year was over twice the refinery-gate or pre-tax petrol price around 1979/80 but similar to the pump price of petrol. More recently (1985) petrol prices have increased relative to ethanol costs due to the weakening of the rand against other major currencies. Ethanol costs are now (1985) about 25% above the refinery-gate petrol price and below the pump price of petrol. SASOL's petrol costs at present appear to be similar to fuel costs based on crude oil and below ethanol costs (from sugar). For new SASOLs the capital cost is expected to increase substantially due to the relatively weak rand. This may make ethanol production from sugar-cane more competitive. A strong positive correlation is evident between sugar-cane production and labour employment. With a subsidized billion-litre ethanol industry labour employment is estimated to increase by 45 000 (34%) under a pool scheme and by 25 000 (19%) under a free edible sugar market compared with current employment. Development costs per worker are estimated to be about R30 000 compared with over one million rand per worker for a new SASOL plant. In a free market the area under sugar-cane is estimated to decrease by about 50% and labour employment by 26%. Areas moving out of cane production include Pongola, Hluhluwe, Nkwaleni Valley, Tala Valley, Umfolozi Flats, Zululand hinterland, South Coast, Natal Midlands (North and South). No sugar would be exported. The local equilibrium sucrose price is estimated to be about 9% below the producers' price under the current policy (that is, up to and including the 1984/85 season) and 17% below the A - pool producers' price under the pool scheme. Social costs of the current policy are estimated as 6.8% of total sucrose value compared with 4.7% under a pool scheme with A - pool quotas transferable only within Mill Group areas and 2.3% where A - pool quotas are transferable between regions. Ethanol production would add to social costs.
An economic study of the technology of harvesting and transport systems used in clearfelling Acacia mearnsii, Eucalyptus grandis and Pinus patula.
(1984) De Laborde, Robert Michael.; Nieuwoudt, Wilhelmus Liberté.; Schönau, A. P. G.; Behrmann, Herbert Ian.
Objectives of this thesis are to project the description and supply of Black labour in the forestry industry of southern Africa, survey harvesting and transport systems used overseas and locally, select and adapt a method to analyse and quantify local systems and present the results of this research. The next objective is to write a computer programme which uses these results to estimate labour and machine requirements with their respective production rates and give standard cost analyses. This supplies the detail for system selection, daily management of harvesting and transport operations and the basis for control by comparing projected production rates and costs with historical data. Although labour intensive systems are still being comployed, it was found that costs and unavailability of Black labour has forced a conversion to capital intensive systems. This trend is expected to continue at an increasing rate. Many European machines appear to have developed from forwarders with various heads fitted to their cranes to perform different operations. American equipment has tended to develop around the articulated front-end loader. In South Africa, the locally invented three-wheel loader has been adapted to fill a similar role. However, it is premature to forecast the direction southern African forestry will follow. Of the possible work measurement techniques, the so-called stop watch methods were selected as they proved to be the most accurate, penetrating and rapid. Results were reproducible and highly significant when regressed on the appropriate tree, terrain or work site dimensions. A survey of available computer simulation programmes revealed that in their present form they were unsuited to southern African harvesting and transport operations investigated. Consequently, the writer wrote a programme in FORTRAN 77 which contains all results in this thesis and analyses timber harvesting and transport. The programme, named Techno-Economic Analysis of Logging (TEAL), supplies its results in a form suitable for both field staff and senior management. TEAL analyses have been found to compare closely with efficient operations. Many of this thesis' data have been compiled into tables giving piece work rates in simplified form. These are presented in appendices.
The economics of smallholder irrigation water management : institutions, water-use values and farmer participation in KwaZulu-Natal, South Africa.
(2014) Muchara, Binganidzo.; Ortmann, Gerald Friedel.; Wale, Edilegnaw Zegeye.; Mudhara, Maxwell.
In recognition of the role of smallholder irrigation farming in ensuring better rural livelihoods, the South African government has made substantial public investment in irrigation infrastructure. The most important perceived problems of communally-managed irrigation schemes in South Africa are the provision of an assured water supply and institutional support relating to water and land allocation, appropriate management, managing local conflicts and farmer participation and collective action in managing water resources. However, if one is to consider international standards as a yardstick, most communallymanaged irrigation schemes in South Africa are undergoing Irrigation Management Transfer (IMT), where the responsibility of managing, operating and maintaining irrigation schemes becomes that of the farmers instead of the state. The most critical issue, given the history of poor performance of smallholder farmers in South Africa, is the extent of users' involvement in irrigation water management. While user participation in water resource management is a South African and international principle, the question is whether smallholder farmers appreciate the importance of and possible benefits to be accrued from the participation. The objectives of the study were: to assess water governance and institutional arrangements and their effects on irrigation management in the Mooi River Irrigation Scheme (MRIS) in KwaZulu-Natal, South Africa; to assess the implication of institutional and management systems on water-use security; to assess the level of farmer participation in collective agricultural water management and the factors affecting users' willingness to do so; and, lastly, to estimate and explain the variation in average irrigation water values as a basis to understand the water management challenges at smallholder farm level. The study used a number of data collection and analytical techniques to achieve the specific objectives. Participatory rural appraisals, which included focus group discussions and key informant interviews, and three household surveys comprising of 60, 71 and 307 respondents were conducted to answer the specific questions. Water governance and institutional arrangements are critical in shaping the long-term sustainability of smallholder irrigation schemes. The Institutional Analysis and Development (IAD) framework and Ostrom's eight institutional design principles were applied for assessing the linkages and effectiveness of institutions governing the management and use of irrigation water resources in the Mooi River Irrigation Scheme. The study found that water user participation was hindered by farmers' lack of understanding of water policies that are driving the formalisation of local water management systems, which include the registration of water user associations and the requirement for farmers to contribute towards the sustainability of such associations. The role and relevance of water-user associations as formal local water governing institutions and their linkages to informal management structures like local irrigation committees and traditional leadership are weak and require farmer training to enhance coherent institutional linkages at local level. Weak regulatory instruments characterised by poor rule enforcement mechanisms, lack of secured property rights (especially for land) and lack of water security impact irrigation water management among smallholder farmers negatively. Irrigators in community-managed schemes have varying levels of water access. However, the greatest challenge in these schemes is lack of understanding of the level of water-use security and the influence of local management systems. As such, the study assessed the implications of institutional arrangements on agricultural water-use security. The study recognised the multifaceted nature of agricultural water-use security and therefore applied the Lancaster- Maler model in the conceptualisation of water use at farm level. After applying Principal Component Analysis (PCA) to construct water-use security indices based on the desired attributes of irrigation water, the Ordinary Least Square (OLS) regression technique was applied to identify factors affecting water use at farm level. The results show that agricultural water-use security can be grouped into three main dimensions, namely: physical on-farm availability of irrigation water, existence of effective enforcement mechanisms pertaining to water appropriation, and effective involvement of water users in decision-making processes. The study points to the fact that water-use security at farm level is relative and therefore no absolute measures can be applied. Furthermore, the three dimensions of agricultural water-use security are affected by, among other things, farmers' experience in irrigation, household income, effectiveness of irrigation committees to enforce appropriation rules, membership of an irrigation scheme, membership of a water user association, as well as resource and cost sharing. To ensure improvement in agricultural water-use security among small-scale irrigation farmers, institutional arrangements that promote the effective participation of farmers in decision-making and conflict management mechanisms are recommended. This can be augmented by creating mechanisms that ensure equitable sharing of resources and costs among common pool resource users. Improving the capacity of local institutions and management structures to minimise unsanctioned access to common pool resources (CPRs) may also improve water-use security. In line with current focus by most developing countries, including South Africa, to transfer management of communal irrigation schemes from state to farmers, an understanding of the determinants of farmer participation in collective activities forms the basis for improving the management of previously government-funded schemes. Empirical results of Tobit and the Ordered Probit models, estimated using cross-sectional data from 307 randomly selected smallholder irrigators, suggest that collective activities are negatively affected by low farmer-literacy levels. Furthermore, the number of consecutive days per week that farmers go without access to irrigation water was used as a proxy for water scarcity, and was a significant determinant of farmer participation. The existing incentives for water-users in the Mooi River Irrigation Scheme were weak and need to be improved to encourage farmer participation in collective water management. This calls for strengthening of local water management systems and institutional policies to ensure maximum benefits from participating in collective activities. In a bid to understand on-farm water utilisation and management processes, water valuation was performed using irrigation data collected from 60 farmers over a single production cycle spanning the time from planting to harvesting. Furthermore, the SAPWAT 3 model was used to generate secondary data on irrigation water requirements for selected crops predominantly grown by farmers in MRIS. The residual value method was applied to both primary and secondary data to estimate water values and understand the factors affecting the magnitude of the values across irrigation plots. The results indicated that most farmers in the Mooi River Irrigation Scheme applied less water (average of 61.4%) to their potato crop, ranging between 14% and 174%, when compared to the irrigation water requirements. Crops with relatively low gross margins like maize and dry beans yielded lower average water values of ZAR1.31/m3 and ZAR1.09/m3 respectively, while tomatoes yielded ZAR11.78/m3. Based on primary data gathered over the entire production cycle, the average water value for potatoes was ZAR0.50/m3, ranging from negative ZAR17.57/m3 to +ZAR12.66/m3, which were lower than that imputed from secondary provincial budget estimates, i.e. ZAR2.10/m3. This suggests poor performance by farmers in the study area. The variability of water value was significantly influenced by the location of the irrigated plot along the main canal, which accounted for 12.5% of the variation. The number of irrigation cycles and education level of the farmer explained 5.8% and 5.9%, respectively, of the variation in average water values. The study illustrates that where water is provided free of charge to a large group of users, unequal distribution, poor management and inefficient use are the challenges commonly encountered. Negative water values also revealed under-performance and the potential high level of indirect government subsidisation of smallholder farmers, mainly through provision of irrigation infrastructure. In sum, the study has shown the complexity of managing common pool resources at a localized level, and pointed to the need to further understand the institutional dynamics in which smallholder irrigation farmers operate. In view of the parallel arrangements between formal and informal water management structures in communally managed schemes, it is recommended that the traditional authorities be incorporated in the water-user associations as ex-officio members and be the custodians of rule enforcement at community level. This might improve compliance to appropriation rules, where the traditional courts can be used concurrently with water user associations to settle local water disputes at community level. Furthermore, communally-managed irrigation schemes still lack capacity for self-management and the negative water values signify poor performance. It is therefore recommended that both human and financial resources as well as technical backup still need to be provided through government support programmes to avoid the widespread collapse of communally-managed irrigation schemes in South Africa. However, such support should mainly be through capacity building, training and provision of expertise in irrigation management to enable the users to manage the scheme on their own, while putting mechanisms in place to ensure that irrigators pay for the maintenance of the infrastructure using returns from irrigation farming.
Enhancing the contribution of small-scale growers in the sugar industry.
(1999) Sokhela, Mbuyiselwa Patrick.; Breen, Charles Mackie.
In the South African Sugar Industry, small-scale sugar cane growers outnumber large-scale growers by more than 10:1. They farm approximately 33% of the total area planted to sugar cane, but produce approximately 10% of sugarcane reaching the mills. Special institutional and support services have been developed to promote the interests of small-scale growers. This study assessed the effectiveness of small-scale grower development as perceived by the Mill Cane Committees (MCCs) who represent the Black small-scale grower organisations. The study focussed on the MCCs. Information from members of these committees was gathered by way of questionnaires, group discussions and key informant interviews with support services representatives. Findings were contextualised in an historical perspective which indicated social, economic and political marginalisation, which has had profound consequences. Some of the more important findings were: 1. Small-scale growers were neglected, marginalised and isolated in the Sugar Industry until 1973, and were excluded from using support services available to other growers until 1983. 2. The organisational structures of small-scale growers are ineffective. 3. Small-scale growers had a low level of trust in the support services offered by the Sugar Industry to support their operations. 4. Interaction between the Mill Cane Committees, the local farmers' associations, the local grower councils, and service providers, mainly small-scale cane contractors and extension services, were considered poor. 5. Support services were not directed by small-scale growers' needs. 6. Training programmes, whilst beneficial to small-scale growers, were shown to be too technical and narrow. They concentrated too strongly on elements of sugar cane production and not sufficiently on the people and their operations. 7. Small-scale growers perceived cooperatives as a means of empowerment. Without significant increase in profitability (better sugar cane and more of it), this was shown to be questionable as cooperatives are unlikely to be self sustaining. 8. Small-scale growers did not understand the interrelationships between the aims of the Sugar Industry and their own operations. The mills aim to make profits from sugar cane and the South African Cane Growers' Association wishes to maintain a good political image to protect import tariffs, whereas small-scale growers want more emphasis on support systems and community development. Small-scale growers must realize that the Sugar Industry is not responsible for providing improved education and training and support services neither for sugar production nor for activities outside of the Sugar Industry. The Sugar Industry may choose to assist small-scale growers if it believes that by doing so it will increase its own profitability and improve its political image. Small-scale growers should control their destiny and be committed to self management of small-scale grower development in the long term. This may be achieved by developing effective organisational structures, proper interaction with support service providers and less dependency on the Sugar Industry. The findings of this research are considered to be relevant to most if not all developing countries, because sugar cane production requires a mill, the mill requires assured sugar cane supply; this is most efficiently supported by estates and large-scale growers. Small-scale growers remain a convenient "top up" when sugar cane is in short supply and an inconvenient and expensive burden when sugar cane is not required.
Entrepreneurial development pathways for smallholder irrigation farming in KwaZulu-Natal : typologies, aspirations and preferences.
(2017) Chipfupa, Unity.; Zegeye, Edilegnaw Wale.
Smallholder irrigation in South Africa is strategically recognized as an important sector in addressing rural poverty, food insecurity and rising youth unemployment. However, despite the government’s efforts and huge investment, the sector has failed to make a meaningful contribution to overcoming these challenges. The poor performance has been attributed to the failure of the existing programmes to develop the human and social capital to manage the schemes and effectively engage in market-oriented agricultural production. This has resulted in the inability of smallholders to utilize the opportunities availed through irrigation farming. South Africa’s national policies identify entrepreneurship as an appropriate intervention strategy for improving the performance of smallholder irrigation. However, to unlock entrepreneurship, a better understanding is required regarding smallholder farmer behaviour vis a vis the relevance/application of the concept to smallholders, and their aspirations, heterogeneity and preferences for irrigation water management. Thus, the objectives of the study were: to assess the validity and applicability of the mainstream concept of entrepreneurship to smallholder irrigation farming in South Africa and identify avenues of adaptation to make it relevant; to identify sources of smallholder heterogeneity and determine the farmer typologies in smallholder irrigation, accounting for psychological capital; to examine aspirations of smallholder farmers to expand irrigation crop production; and assess farmer preferences for managing irrigation water resources and their willingness to pay for irrigation water. The data for the study came from a stratified random sample of 328 smallholders in and around Makhathini and Ndumo-B irrigation schemes in Jozini, KwaZulu-Natal, South Africa. The data were collected through a household questionnaire survey and focus group discussions. The study employed literature review, descriptive analysis and several empirical approaches (Principal Component Analysis, Cluster Analysis, Heckman two-step selection model and choice experiment modelling). The research uniquely introduced and integrated the concept of psychological capital to the Sustainable Livelihoods Framework literature to enhance understanding of entrepreneurship among smallholder farmers. The findings showed that smallholders do not conform to the mainstream definition of entrepreneurship which is mainly the result of the neoclassical economics paradigm. This does not, however, mean that such farmers cannot be entrepreneurial, but it highlights the need for redefining the concept to suit their context. A paradigm shift is required to improve the performance of smallholder irrigation and unlock entrepreneurial spirit, putting smallholder behaviour at the centre for which the concepts of psychological capital and behavioural economics are expected to play a bigger part. There is also a need to embrace indigenous knowledge, the multipurpose nature of smallholder farming, heterogeneity and creating an enabling environment. In the end, the study proposed a contextualized definition of entrepreneurship for smallholders which places more significance on the willingness and ability of entrepreneurial smallholders, through their own initiatives, to address their challenges, even in the midst of constraints. The study revealed five farmer typologies in smallholder irrigation in South Africa: elderly and uneducated, cautious and short-sighted, financial capital and psychological capital endowed, social grant reliant, and land endowed rainfed farmers. Heterogeneity in these typologies is observed regarding psychological capital endowment, market access, collective action and access to credit. The results affirm the fact that the ‘one size fits all’ approach to agricultural policy and support is not appropriate. Heterogeneity among smallholders should be accounted for in future agricultural and rural development programmes. However, accounting for this heterogeneity is a double-edged sword. On one side it complicates tailor-made policy formulation and on the other side, if there is capacity, it makes the portfolio of policies and strategies impactful and relevant. Th study identifies psychological capital as important and recommends its recognition and nurturing as a key livelihood asset. The findings suggest that farmers’ willingness to expand irrigation farming activities is affected by positive psychological capital, access to markets, access to credit, land tenure security and membership to social groups. Their ability to achieve their aspirations is determined by asset ownership, access to markets and local resource use conflicts. This evidence further demonstrates the importance of developing positive psychological capital among smallholders. The priority areas for improving access to agricultural credit and markets include, among others, value chain financing, reforming the existing agricultural credit schemes and investment in road and transport infrastructure. Smallholders’ ability to achieve their aspirations and make better use of irrigation schemes should be enabled through improving access to physical capital assets, addressing land security concerns, and supporting institutions that promote social interaction and learning. The findings from the choice experiment demonstrate that valuing and recognizing the scarcity of irrigation water is essential for its sustainable use. The results suggest the need for irrigation water pricing to reflect irrigation intensity. They also show that improving agricultural production and productivity, with market access can enhance farmers’ willingness and ability to pay for irrigation water. The study reveals the need to consider multiple uses of irrigation water, while a focus on women smallholders has positive implications for sustainable management and use of irrigation water. It also recommends a shift towards volumetric water pricing at the farm or plot level in the irrigation schemes. In sum, the study has shown why it is of critical importance to take the mindset and human behaviour as the locus of interventions to improve the performance of smallholder irrigation schemes. It recommends a psychological and behavioural economics approach to understanding farmers’ decisions and behaviour and to provide the road map to realize the returns on investment in the smallholder irrigation sector. Agricultural extension approaches need to target for developing the psychological capital and entrepreneurial spirit of smallholders and supporting cooperatives deliver their mandate effectively. Furthermore, policies should assist in creating an environment that nurtures farmer entrepreneurial spirit, and that is supportive of smallholder entrepreneurs. This includes, but not limited to, encouraging and incentivizing own effort rather than embracing a culture of dependency.

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