The Economics of Cold Storage Adoption of Onion Farmers in Bongabon, Nueva Ecija, 2009

Date

4-2010

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Dr. Ma. Eden S. Piadozo

Committee Member

Prudenciano U. Gordoncillo, Flordeliza A. Lantican

Abstract

This study focused on the economics of cold storage adoption in Bongabon, Nueva Ecija in 2009. Generally, it aimed to determine the profitability of cold storage adoption in Bongabon. The specific objectives of the study were to: (1) characterize the postharvest practices adopted by the onion farmers in the area; (2) know the farmers level of awareness and degree of adoption of cold storage in Bongabon; (3) determine the factors affecting the adoption of cold storage among farmers; (4) determine the costs and benefits of the cold storage adoption; and (5) identify the problems encountered by the farmers in the adoption of the program and come up with recommendations to solve the problem.

Primary and secondary data were used in this study. Primary data were taken from personal interviews of 122 onion farmers which were identified using stratified random sampling. Secondary data were gathered from the municipal agricultural office, operating cooperatives, and cold storage facility. The participants were divided into two categories: cold storage and non-cold storage participants.

The majority (58%) of the total onion harvested were placed in cold storage. However, only 8 percent of the total onion farmer population adopted this system. Cold storage is at its peak during March, the harvest season in onion production. The onions are sorted, cleaned, packed into 27.5kg per bag, and labelled before transporting to the KASAMNE, the cold storage facility in Palayan, Nueva Ecija.

The factors affecting the farmers’ decision to adopt cold storage were level of education, distance of the cold storage facility, farm size, previous knowledge in cold storage, profit, organizational membership, presence of kasama, volume of harvest and the variety used based on the results of the logit analysis. Immediate buyers were present right after harvest so when prices were acceptable, farmers tended to sell their products directly. Those who chose not to sell directly their onions stored their products either in dryers, houses, or cold storage facility.

The cost and returns analysis revealed that a Php 39.83 per kg net return is expected if cold storage is adopted. The practice of cold storage was found to be profitable for the onion farmers since the additional expenses are off-set by the additional returns with a Php 14.56 per kilogram change. T-test results showed that farmers who engaged in this activity gained more than those who did not.

The problems of onion farmers were categorized into two types: non-storage and storage related. The major non-storage related problems were: (1) the climate that encourages losses because of the prevailing humidity in the area; and (2) the low selling price that farmers receive for their onions. The major storage-related problems were the capital involved in the storage and the quality of the services offered by the cold storage facility.

As a result of the study, it is recommended that farmers be encouraged to practice cold storage in spite of the problems involved in the process. Problems in the improvement of the management within the primary cooperatives and the secondary cooperative, KASAMNE, must be addressed. It is also recommended that the local agricultural municipal office conduct a constant maintenance check on the cold storage facility.

Language

English

LC Subject

Onion industry, Farmers, Adoption, Economics

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993.5 2010 A14 D66

Notes

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Document Type

Thesis

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