IS SMALL STILL BEAUTIFUL? THE FARM SIZE-PRODUCTIVITY RELATIONSHIP REVISITED

Transcription

1 28 IS SMALL STILL BEAUTIFUL? THE FARM SIZE-PRODUCTIVITY RELATIONSHIP REVISITED Milu Muyanga & T.S. Jayne Agricultural, Food and Resource Economics Department Michigan State University, USA Presented at the at the 2014 Conference on Land Policy in Africa The African Union Conference Center, Addis Ababa, Ethiopia, November 12, 2014 Photo: Christiaensen and Demery (2007)

2 27 Emerging trend #1 Farm sizes are shrinking due to mounting population pressure in sub- Saharan Africa

3 Total rural population projections 26 Source: UN Pop Council, 2013

4 25 Shrinking farm sizes Arable land per capita hectares per person year World Sub-Saharan Africa Zambia Source: World Development Indicators, World Bank

5 Hectares of arable land per person in agriculture --10 year average landperson ratio as % of Ethiopia % Zambia % Kenya % Uganda % Malawi % Zimbabwe % Rwanda % Mozambique % Ghana % Nigeria % 24

6 23 Emerging trend #2 Rapid increase in medium-scale farmers (5-100 ha)

7 22 Emergent farmers Defined as farmers cultivating between 5 to 100 hectares Emergent farmers have little in common with largescale farmers Farm size, access to finance, input application, farm management practices

8 21 Table 2: Changes in farm structure among small- and medium-scale farmers in Zambia ( ) Landholding size Category Number of farms % change % of total farmland ( ) 2001* Share of landholding cultivated (2012) 0 2 ha 638, , , % 24.1% 16.2% 91.2% 2 5 ha 159, , , % 33.8% 31.7% 66.4% 5 10 ha 20, , , % 20.3% 25.0% 49.5% ha 2,352 35,898 53, % 12.3% 15.0% 36.7% ha -- 9,030 13, %** 9.5% 12.0% 10.9% Total 820,341 1,438,779 1,399, % 100.0% 100.0% Source: Ministry of Agriculture Crop Forecast Surveys, 2009, *2001 figures are land under cultivation. ** Growth rate computed from only. na means not available.

9 Who are the emergent farmers? 20

10 What are the medium-scale farmers characteristics? 19 Is this growth driven by farmers who began as smallholders, and now transitioning to a larger scale status through the capital and assets accumulation? Is the growth driven by institutions and policies (deficient policies) that encourage investment in land acquisitions by individuals from non-agricultural employment How does their agricultural productivity compare to that of the smallholders?

11 Who are the medium-scale farmers? 18 Majority of them used non-farm entry pathway Urban and rural elites Most them are current/former public sector employees Relatively well-educated Only a minority were primarily engaged in agriculture But had sufficient initial endowment of land Owned over two times more land than they were using for crops: High degree of land owned for speculative purposes Inability to make productive use of their land

12 Descriptive results [I] 17 Majority (60%)of medium-scale farmers used non-farm entry strategy Majority of them are current/former public sector employees Had high education attainment Acquired land from savings from non-farm, largely urban jobs Only a minority were primarily engaged in agriculture But had sufficient initial endowment of land Owned over two times more land than they were using for crops: High degree of land owned for speculative purposes Inability of these farmers to make productive use of their land

13 16 Medium-scale farmers control more land Large scale Ghana 3.08 Kenya 0.69 Zambia 2.11 than large-scale enterprises! Mediumscale (5-100 ha) Millions hectares Source: Jayne et al (JIA)

14 15 Medium-scale farmers control more land than large-scale enterprises! Large scale Mediumscale (5-100 ha) Millions hectares Ghana Kenya Zambia Source: Jayne et al (JIA)

15 14 Smallholder farms productivity- Kenya '000 KSh/ha planted Figure 2b: Farm and crop income per hectare planted Farm income Crop income 25% 50% 75% 95% land -- planted (ha)

16 13 Medium-scale farms productivity- Kenya '000KSh/ha planted Figure 2a: Value of crop production per hectare planted Gross value Net value 25%50% 75% 95% land -- planted (ha)

17 12 Medium-scale farms production costs- Kenya Figure 5a: Total crop production costs per hectare planted '000KSh/ha planted %50% 75% 95% land -- planted (ha)

18 11 Medium-scale farms production costs- Kenya Figure 6: Total crop production costs by components '000KSh/ha planted %50% 75% 95% land -- planted (ha) Fertilizer Land preparation Fixed costs Seed Labor

19 10 How is changing farm structure affecting the potential for land expansion to support smallholder agricultural growth?

20 Medium-scale farmers control more land than large-scale enterprises! 9 Large scale Mediumscale (5-100 ha) Millions hectares Ghana Kenya Zambia Source: Jayne et al (JIA)

21 Medium-scale farmers controlling significant proportion of farmland 8 Large scale Mediumscale (5-100 ha) Smallscale (0-5 ha) Millions of hectares Ghana Kenya Zambia Source: Jayne et al (JIA)

22 Medium-scale farmers controlling significant proportion of farmland 7 Large scale Mediumscale (5-100 ha) Smallscale (0-5 ha) Total land controlled Millions of hectares Ghana = Kenya = 4.16 Zambia = 6.67 Source: Jayne et al (JIA)

23 Medium-scale farmers controlling significant proportion of farmland 6 Large scale Mediumscale (5-100 ha) Smallscale (0-5 ha) Total land controlled Potentially available cropland remaining Millions of hectares Ghana = Kenya = Zambia = Source: Jayne et al (JIA)

24 5 Optimism that small-scale farms can expand Is the smallholder-led agricultural development still feasible? Some medium-scale farmers started out with less than five hectares of land At least some room for optimism that small-scale farms can expand into commercialized medium-scale stature under favorable conditions including access to land Smallholder-led growth is more broad-based and

25 4 Conclusion Most governments strategies are oriented to promote agricultural growth and food security for the millions of their rural constituents who are smallholders assume unhindered access to land

26 3 Looming employment challenge in SSA 62% < 25 years old

27 2 Government policy orientation Wage employment will be able to absorb two thirds of the people entering the labor force between 2010 and 2020 Access to land will largely determine whether millions of rural Africans will make a decent livelihood and be able to feed themselves This will depend on how supportive the land allocation and agricultural policies are to smallholders African leaders may soon perceive that political stability will depend on the profitability of family farming

28 1