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Agro-economic Performances of Potato Seed Production Under Contract Farming in Bangladesh

Moniruzzaman
Senior Scientific Officer
Agricultural Economics Division, BARI Joydebpur, Gazipur-1701

M. S. Rahman
Scientific Officer
Agricultural Economics Division, BARI Joydebpur, Gazipur-1701

Sahadat Hossain
Chief Scientific Officer
Agricultural Economics Section,HRC, BARI Joydebpur, Gazipur-1701

Abstract/ Executive Summary:

The study was undertaken in Rajshahi, Rangpur and Thakurgoan district during 2010-11 to measure the relative profitability and to estimate the recourse use efficiency of potato seed production under contract growing system. Data were collected from 90 contract growers and 90 non-contact growers of the selected three districts. The study revealed that there was significant difference between the cost of potato seed cultivation under contract and non-contract growers. The yield of potato seed under contract growing system was significantly higher than that of non-contract growing system. The gross return (Tk.380360.00), gross margin (Tk.247411.00) and net return (Tk.212165.00) were significantly higher for contract growers compared to the non-contract growers. The benefit-cost ratio was almost higher under contract farms compared to that in non-contract farms. The result also revealed that farmers were not efficient in terms of resource allocation. Higher price of quality seed and lack of storage facilities, lack of technical knowledge, infestation of insects and diseases and lack of capital were the main problems that the contract and non-contract farmers faced in the study areas.

Keywords: Profitability, Potato seed, Contract Farming

Location: Rajshahi, Rangpur and Thakurgoan

Start Date: 00-00-2010

End Date: 00-00-2011

Program Area: Socio-economic and Policy

Non-commodity: Performance

Objectives:

i. To identify the available contract growing systems and their working patterns

ii. To compare the costs and returns of potato seed production under contract and non-contract farming

iii. To estimate the resource use efficiency of potato seed production under contact and non-contract farming system

iv. To know the problems of potato seed production and suggest some policy guidelines for improving this system.

Methodology:

The study was conducted in three potato seed growing districts namely Thakurgoan, Rangpur and Rajshahi districts of Bangladesh. A total of 90 contract growers, taking 30 from each district were selected randomly for the study. Besides, 90 non-contract growers taking 30 from each district were also selected to compare the costs and return of potato seed production under contract and non-contract farming. Data were collected by survey method with the help of pre-designed and pre-tested interview schedule during the Rabi season in 2010-2011. The collected data were mostly analyzed by tabular methods to fulfill the objectives set for the study. The efficiency of inputs used in potato seed production was measured.Cob-Douglas production function model was used.

Source of Information: Annual Research Report, Agricultural Economics Division, BARI

Article Link (Online Journal):

Funding Source:

Budget:

Total Budget (Tk.) :

Achievement/Findings:

The total cost of potato seed cultivation was Tk. 168195 for contract growers where as it was Tk. 173056 for non-contract growers which was significantly higher than contract growers. But the total cost of contract growers was found higher than non-contract growers due to use of higher inputs in Rangpur district. The yield of potato seed under contract growers was found to be 21395 kg/ha which was 3.43% higher than non-contract growers due to use higher amount of TSP, MP, gypsum, Boron and MgSO₄. As a results contract growers in the study areas received significantly higher gross return, margin and net return than that of non-contract growers. The rates of return were 2.29 and 2.04 on total cost basis for contract growers and non-contract growers respectively. The variables like seed, urea, TSP and MP had significant effect on potato seed production. The co- efficients of seed (X2) and TSP (X5) are positive and significant at 1% and 5% level, while co-efficient of urea (X4) and MP(X6) are negative and significant at 10% and 5% level respectively. The positive co-efficient of seed and TSP indicated that the production of seed potato will be increased by 9.1% and 0.63% if the use of seed and TSP are increased by 10% keeping other factors constant. The ratio of MVP and MFC is found to be higher than unity for seed, urea, TSP and MP. The benefit-cost ratio was almost higher under contract farms compared to that in non-contract farms. The result also revealed that farmers were not efficient in terms of resource allocation. Higher price of quality seed and lack of storage facilities, lack of technical knowledge, infestation of insects and diseases and lack of capital were the main problems that the contract and non-contract farmers faced in the study areas.

Knowledge Management: Report/Proceedings