On March 12th, Kamiljon Akramov presented findings from a recent analysis examining the profitability of maize, rice, and soybean in Ghana. Data from 256 farmers in 4 districts in Ghana was collected in order to prepare crop budgets for maize, rice and soybeans. Crop budgets were then used to examine the profitability of each of the 3 crops.
Key findings from this analysis include:
- Policy implications are different under the observed and profit-maximizing scenarios
- One may argue that average maize, rice and soybean farmers are not viable in the long-run because they are making losses at social prices
- However, findings suggest that efficient farmers make substantial positive profits and the society also makes welfare gains from resources allocated to maize and soybean production
- Policies based on dissemination of best practices could improve overall efficiency of these cropping systems
- Bridging the gap between average and efficient farmers shifts average farm from a net loss of GHC111 (GHC96) per ha to a net profit of GHC196 (GHC358) for maize (soybean)
- Rice production does not appear to be profitable even for efficient farmers given the social prices
- Including family labor in net revenue provides a different perspective pointing to the ability of maize, rice and soybean production to create value for farmers and also to add welfare gains to the society
For more details, the full presentation can be found here. Further analysis examining what sets efficient farmers apart is currently underway and will be shared when it becomes available. The working paper on this analysis will also be shared on this blog when it is finalized.