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Economics of Small Scale Commercial Banana Farming in Tangail District of Bangladesh

ZT Munia
Department of Agricultural Economics, Bangladesh Agricultural University, Mymensingh-2202, Bangladesh

S Islam
Assistant Professor
Department of Agricultural Economics, Bangabandhu Sheikh Mujibur Rahman Agricultural University, Gazipur-1706, Bangladesh.

K Akhi
Assistant Professor
Department of Agricultural Economics, Bangabandhu Sheikh Mujibur Rahman Agricultural University, Gazipur-1706, Bangladesh.

MS Islam
Supervisor
Department of Agricultural Economics, Bangladesh Agricultural University, Mymensingh-2202, Bangladesh.

Abstract/ Executive Summary:

This study was conducted to analyze the profitability of banana farming in some selected areas of Tangail district of Bangladesh during 2015. A total of 60 samples (16 small, 19 medium and 25 large farmers) were directly interviewed using a structured questionnaire for achieving the purpose. Apart from the descriptive analysis of the socio-economic variables of the selected respondents, the benefit-cost and functional profitability analysis of banana farming were also performed. The Cobb-Douglas production function was chosen to determine the effects of various inputs on the profitability of banana. The finding of cost-benefit analysis reveals that banana farming is a profitable activity in Bangladesh as the estimated cost of production was lower than the return in the selected study areas. However, the profitability differs among different farmers’ group and large farmers are more profitable in banana farming than small and medium farmers. In addition, the functional analysis identifies four inputs such as the cost of human labor, manure, fertilizer and irrigation as the significant determinants of profitability of banana farming in the study area. In this study, resource use efficiency was also measured to show the efficient resource allocation to attain the goal of profit maximization which showed that human labor, seedling, manure, fertilizer, insecticides, irrigation and bamboo has inefficient use of the resources, and farmers should limit the use of these inputs. The researcher suggested some recommendations to improve the present production situation so that banana farming could be more viable and attractive commercial enterprise.

Keywords: Banana, Profitability, Cobb-Douglas Production Function, Resource Use Efficiency, Gross return

Location: Madhupur upazila of Tangail district of Bangladesh

Start Date: 00-02-2015

End Date: 00-04-2015

Program Area: Socio-economic and Policy

Non-commodity: Income generation

Objectives:

The study aims to: (i) assess the financial profitability of banana production and (ii) determine the factors influencing the returns of banana production.

Methodology:

Sampling technique and data collection- Considering the objectives of the study Madhupur upazila of Tangail district of Bangladesh was selected purposively as the study area. Four villages namely Joynagacha, Gopinathpur, Sholakudi and Vobaniteki were covered for collecting necessary information for the study. A total of 60 farmers including 16 small, 19 medium and 25 large farmers, were selected by stratified random sampling. In this case, the farms were categorized by total land as small farmers (having land 0.40-1.01 hectares), medium farmers (having land 1.01-3.03 hectares) and large farmers (3.03 hectares and above) (BBS, 2017). The researchers collected necessary primary data of banana growers through questionnaire interview with a structured questionnaire during the period of February to April, 2015. Analytical method- The collected data was analyzed on the basis of the objectives of the study by using descriptive statistics, mathematical and statistical analysis. Descriptive statistics were used to represent the socio-economic characteristics of the respondents. Mathematical analysis- Mathematical analysis includes the profitability of banana production, which was calculated in terms of gross return, gross margin, net return, and benefit cost ratio (BCR). Gross return- Gross return (GR) was calculated by multiplying the total volume of output of an enterprise by the average price in the harvesting period (Dillon and Hardaker, 1993). Gross return, GR = Σ QP … (1) Where, GR= Gross return from product (BDT/ha); Q= Quantity of the product; P= Average price of the product (BDT/ha). Gross margin- Gross margin (GM) of farming enterprise is its output less the variable costs attributed to it (Barnard and Nix, 1999). GM = GR-TVC … (2) Where, GM = Gross margin (BDT/ha); GR = Gross return (BDT/ha); and TVC = Total variable cost (BDT/ha). Net return- Net return was calculated by deducting total costs from gross return as shown in the equation 3. Net Return, NR= Σ(GR-TC) … (3) Where, GR= Gross return from product (BDT/ha); TC= Total cost (BDT/ha). Benefit cost ratio (BCR) The BCR is a relative measure, which is used to compare benefit per unit of cost. The BCR estimated as a ratio of gross returns and gross costs. Benefit cost ratio, (BCR) = Gross return/ Total cost … (4)

Source of Information: Int. J. Agril. Res. Innov. Tech. 9(2): 67-75, December 2019

Article Link (Online Journal): DOI: https://doi.org/10.3329/ijarit.v9i2.45413

Funding Source:

Budget:

Total Budget (Tk.) :

Achievement/Findings:

In this study, resource use efficiency was also measured to show the efficient resource allocation to attain the goal of profit maximization which showed that human labor, seedling, manure, fertilizer, insecticides, irrigation and bamboo has inefficient use of the resources, and farmers should limit the use of these inputs. The researcher suggested some recommendations to improve the present production situation so that banana farming could be more viable and attractive commercial enterprise.

Knowledge Management: Journal