Profitability Analysis of Small-hold Banana Farms in Selected Towns of Davao Del Norte and Quirino, 2005

Date

4-2006

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Cesar B. Quicoy

Abstract

The general objective of the study was to analyze the profitability of small-hold banana farms in selected towns of Davao del Norte and Quirino for the year 2005. Its specific objectives were (1) to describe the cultural practices of small-hold banana farms, (2) to determine the costs and returns of production of small-hold banana farms, (3) to identify the factors affecting the production of small-hold banana farms, (4) to analyze the efficiency in the utilization of resources of small-hold banana farms, (5) to identify problems of small-hold banana farms, and (6) to identify interventions which can improve profitability of small-hold banana farms.

To attain the abovementioned objectives, descriptive analysis, cost and returns analysis, and production function analysis using the Cobb-Douglas model were done in the study. Measures of profitability and measures of economic efficiencies were also measured. The technical efficiency was determined by the regression coefficients which are the elasticities for the individual factors of production.

Cost and returns analysis showed that among the different banana cultivars planted in Davao del Norte, the cultivar with highest net farm income was Lakatan followed by Saba and then Latundan. In Quirino, small-hold Saba farms had the highest net farm income followed by Lakatan and then Latundan. Among the three cultivars planted in Davao del Norte, the only profitable was Lakatan. In Quirino, the three cultivars were all profitable.

The results of production function analysis on small-hold Lakatan farms in Quirino suggested that four of the nine production factors were significantly related to yield. Farm size, age of farmers, and attendance on trainings/seminars were inversely related to yield. The number of years engaged in banana farming was directly related to yield. For small-hold Saba farms in Quirino, results of the production function analysis showed two of the nine variables to be significantly related to yield. Farm size and quantity of pesticides used were inversely related to yield. For small-hold Saba farms in Davao del Norte, results of production function analysis showed seven independent variables to be significantly related to yield. Production function analysis was not done on small-hold Lakatan and Latundan farms in Davao del Norte and in small-hold Latundan farms in Quirino because of small sample sizes.

The computed measures of economic efficiency suggested that small-hold Lakatan and Latundan farms in Davao del Norte were more efficient in terms of capital utilization and labor utilization but less efficient in terms of land utilization relative to small-hold Lakatan and Latundan farms in Quirino. Small-hold Saba farms in Davao del Norte and in Quirino have approximately equal level of capital efficiency. In terms of land and labor utilization, small-hold Saba farms in Quirino were more efficient compared to small-hold Saba farms in Davao del Norte.

The major problems encountered by small-hold banana farmers in Davao del Norte and in Quirino were incidence of pests and diseases such as Banana Bunchy-Top Virus, Tibagnol, Moko, Sigatoka, and Bugtok. To avoid yield loss because of these pests and diseases, farmers must consult knowledgeable people such as the municipal agriculturist for the cure and prevention of these pests and diseases. The Department of Science and Technology developed Package of Technologies (PoT) for banana farms that can help minimize incidence of pests and diseases. Proper information dissemination about this Package of Technologies must be done. DOST in coordination with the municipal agriculture office, must conduct trainings and seminars about proper cultural management.

For farms with low land efficiency, farmers can adopt yield-increasing cultural practices. They can consider changing their planting materials and they can also try to improve land efficiency by enhancing soil fertility. However, consultations with the experts must be done first to know the real requirements of the soil. For farms with low labor efficiency, several things can be done such as farm mechanization, division of labor among laborers, provision of better incentives for the laborers, and supervision of the laborers’ performance. Farmers are also advised to organize an association or a cooperative. A cooperative can help the farmers in the procurement of inputs such as fertilizers and pesticides, in securing various forms of assistance from private or government sectors that would provide information on new farming technologies, in improving farm price, and in providing financial schemes for farmers to be able to expand their production.

Language

English

LC Subject

Banana trade, Farms

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993.5 2006 A14 B38

Notes

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Document Type

Thesis

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