Economics and risk mitigation measures for nendran banana cultivation in Thiruvananthapuram district
Loading...
Files
Date
2018
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Department of Agricultural Economics, College of Agriculture, Vellayani
Abstract
The research entitled " Economics and risk mitigation measures for Nendran banana cultivation in Thiruvananthapuram district" was conducted in Neyyatinkara taluk of Thiruvananthapuram district. Risks are inherent in farming business and it can be explained in terms of production risk, price risk and credit risk. The risks are there with regards to weather parameters, yield, price, government policies, global markets and several other factors that can cause a wide swing in farm income. Risk mitigation includes a series of techniques that can eliminate or reduce the negative impact of risk. In this context, the main objectives were to study the economics of banana cultivation, identification of risks and relative advantages of risk mitigation measures and constraints in their adoption. Neyyatinkara taluk was purposively selected which is having the maximum area under banana, from which four panchayats were selected at random. From each panchayat 20 respondents were taken randomly. Thus the total sample size was 80. Further the farmers were classified into insured and uninsured by considering crop insurance as a formal risk mitigation measure. Percentage analysis was done to analyze the socio economic variables and extent of adoption of crop insurance. Cost ABC concept was used to compute the cost of cultivation of insured farmers and uninsured farmers. Resource use efficiency was calculated using Cobb Douglas production function and constraints were ranked by Garret’s ranking technique. Majority (72.5 per cent) of farmers belonged to the middle age group and the average age of the selected respondents was 48.7 years. Considering the educational status, 90 per cent of insured farmers had formal education whereas in case of uninsured farmers the per cent was 86. More than 50 per cent of farmers belonged to medium size family with 4 to 6 members. The average size of land holding was 71.09 cents for insured farmers and 76.08 cents for uninsured farmers. Area under cultivation of banana was 9.53 ha (area under insurance scheme) for insured farmers and 8.12 for uninsured farmers. The average annual income of insured farmers was ₹ 1,39,955.08 and it was ₹ 96,007.80 for uninsured farmers. Out of 80 respondents, 53.75 per cent of the farmers adopted crop insurance as a risk mitigation tool. Most of the insured farmers (88.3 per cent) adopted Kerala state crop insurance scheme and only few farmers resorted to VFPCK scheme. Comparatively high indemnity (₹ 300/ plant) was the reason to attract farmers towards the Kerala state crop insurance scheme. Among the uninsured farmers 35.2 per cent were not aware about crop insurance scheme. The premium per plant was ₹ 3 for SCIS and ₹ 5.50 for VFPCK. Apart from production risk, farmers also considered the price risk and credit risk. For mitigating the price risk, the farmers sold their products through more than one marketing agency (46.25 per cent). The respondents used the institutional agencies (42.5 per cent) as the major source to overcome credit risk. The cost of cultivation of Nendran banana of insured farmers was ₹ 4, 28, 086.70 ha-1 and for uninsured farmers it was ₹ 3, 99, 796.5 ha-1 at Cost C. In both cases, the manures and fertilizers cost accounted the highest share followed by hired labour in the variable cost. The average yield was 259.7 q ha-1 and 220. 9 q ha-1 for insured and uninsured farmers respectively. The price of Nendran banana was ₹ 37 Kg-1 at the time of the survey. BC ratio was more for insured farmers (2.25) than uninsured farmers (2.04) at Cost C. The family labour contribution to total labour cost was 36 per cent for insured farmers and 39 per cent for uninsured farmers. The results of Cobb Douglas production function analysis showed positive and significant co efficient for quantity of manures and fertilizers on yield for both insured and uninsured farmers. Hired labour days was also positive and statistically significant for insured farmers. The estimated allocative efficiency was more than one for quantity of manures and fertilizer, quantity of propping and hired labour for both type of farmers indicating underutilization of these resources and it can be increased to enhance the allocative efficiency in production. There are various constraints faced by the banana growers while adopting different risk mitigation measures. Complicated procedure of crop insurance was the major constraint for mitigation of production risk. For mitigating price risk glut of product in the market scored the highest and payment of rent in advance for leased in land scored the highest in the case of constraints for mitigation of credit risk. To conclude, the farmers adopting crop insurance had incurred higher cost of cultivation and obtained better yield and BC ratio from Nendran banana. The analysis revealed that there is scope for efficient utilization of the resources. Lack of awareness was prevalent among the uninsured farmers and complicated procedure of crop insurance was cited as the major constraints for mitigation of production risk by insured farmers. Crop insurance acted as a tool for enhancing the risk taking capacity of farmers for investing more to increase the profitability
Description
Master of Science in Agriculture
Keywords
null