Thesis Abstract of AGS Students

Economic Potentials of Maize Production in Eastern Bhutan

A. Karma Rinzin (1997)

Maize is an important cereal crop in eastern Bhutan with the six districts contributing more than half of the national maize production. To increase productivity at the farm level, the Bhutanese Ministry of Agriculture has released a new variety of maize which performed better than the local variety. Since then there was concerted efforts by the ministry to introduce and induce farmers to take the new variety.

The present study was conducted to look into the potentials of maize production in Eastern Bhutan by looking into the differences in costs and returns and output response to factors of production of the two different types of maize presently under cultivation. As study sites Metsho and Jaray block in Lhuntse district were chosen from within which a sample of 187 was selected using multi-stage sampling procedure. Of the total samples, 83 cultivated only modern variety and the rest cultivated only traditional variety.

The average yield for modern variety (MV) under fertilized condition was 1,248 kilogram per acre while the traditional variety (TV) achieved a yield of 891 kilogram per acre with a difference of 28 percent. The yield was comparatively lower for farmers not using fertilizer which was recorded at 909 kilogram per acre for MV and 656 kilogram per acre incase of traditional variety with a difference of 27.83 percent.

Considering the cost of production, the farmers using fertilizer faced more cost than those not using fertilizer. However, there is not much difference between the two varieties both under fertilized and unfertilized conditions. Under fertilized condition, the MV farmers faced a cost of Nu. 3469.20 for cultivating an acre of land, while traditional variety farmers incurred a cost of Nu. 3426.03 for same unit of land. In the case of farmers not using fertilizer the cost incurred is Nu. 2653.85 for an acre of land cultivated for both varieties. The production cost per kilogram is Nu. 2.77 and Nu. 2.91 for MV under fertilized and unfertilized conditions respectively. For traditional variety the cost is Nu. 3.84 and Nu. 4.04 under fertilized and unfertilized conditions.

The MV has a gross margin of Nu. 3998.62, with a difference of 51% over TV having Nu. 2045.67 under fertilized condition. The margin difference is even higher under unfertilized condition. Gross margin for MV is Nu. 2838.07 to that of Nu. 1267.14 with a difference of 55 percent.

The production function was estimated to see the output relation to different input use. It was estimated through “LIMDEP” program. The analysis result showed that input in use explained variation in yield upto 70% for MV and 74% for TV under fertilized condition and 85 % and 88% respectively no fertilizer condition. Labor and manure are significant in all functions. Fertilizer and seed are not significant in all functions. Fertilizer use ranges from 5-30 kg/ac, which is too little to bring significant impact. However, it is significant when a pooled function of each variety is run.

Regarding the optimal input use, it was found that except seed for TV under fertilized condition, all others have positive coefficients indicating that farmers can still employ more of these inputs to increase production. However, if the ratio of marginal value of product of each input to its unit price is considered, only manure has its MVP greater than the unit price in all the cases. Production increase also could come through use of more fertilizer as its MVP is also greater than the unit price.

The study found out that there is still further room for enhancing the production potential through use of modern variety and chemical fertilizer. They should however, come in proper time at the convenience of the farmers. Furthermore, future assistance to marketing will enhance the production potential.

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