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AN ECONOMIC STUDY ON PRESENT STATUS AND POTENTIALITIES OF GROWING POTATO IN
JAMALPUR AND SHERPUR DISTRICTS
A THESIS BY
Examination Roll No. 08 Ag. Econ. JD-06 M Registration No. 30800
MASTER OF SCIENCE (MS) IN
AGRICULTURAL ECONOMICS (PRODUCTION)
DEPARTMENT OF AGRICULTURAL ECONOMICS BANGLADESH AGRICULTURAL UNIVERSITY
MYMENSINGH
NOVEMBER 2009
AN ECONOMIC STUDY ON PRESENT STATUS AND POTENTIALITIES OF GROWING POTATO IN
JAMALPUR AND SHERPUR DISTRICTS
A Thesis By
Examination Roll No. 08 Ag. Econ. JD-06 M Registration No. 30800
Session: 2003-2004 Semester: July-December 2008
Submitted to The Department of Agricultural Economics
Bangladesh Agricultural University, Mymensingh in partial fulfillment of the requirements
for the degree of
MASTER OF SCIENCE (MS) IN
AGRICULTURAL ECONOMICS (PRODUCTION)
DEPARTMENT OF AGRICULTURAL ECONOMICS BANGLADESH AGRICULTURAL UNIVERSITY
MYMENSINGH
NOVEMBER 2009
AN ECONOMIC STUDY ON PRESENT STATUS AND POTENTIALITIES OF GROWING POTATO IN
JAMALPUR AND SHERPUR DISTRICTS
A Thesis By
Examination Roll No. 08 Ag. Econ. JD-06M Registration No. 30800
Session: 2003-2004 Semester: July-December, 2008
Approved as to the style and content by
(Prof. Dr. M. Serajul Islam)
Supervisor
(Prof. Dr. M. Harun-Ar Rashid)
Co-supervisor
(Prof. Dr. M. Harun-Ar Rashid) Chairman
Examination Committee and
Head, Department of Agricultural Economics Bangladesh Agricultural University
Mymensingh
NOVEMBER 2009
Chapter I
INTRODUCTION
1.1 Background of the Study
Bangladesh is a country dependent mainly on agriculture. Out of land area of
14.96 million hectares, the total cultivated area of the country is 7.97 million
hectares and its cropping intensity is 176 percent (BBS, 2007) which is the highest
in the world. Although the total land area is the same in each year, the total
cultivated area is decreasing year to year. It was 8.03 million hectares in
2003/2004 but it reduced to 7.97 million hectare in 2004/2005 (BBS, 2007).
Bangladesh is striving hard for its development. The economy of Bangladesh
remains predominantly agricultural. The economic development of country is
mainly based on agricultural. The direct contribution of agricultural to GDP is
20.87 percent (MoF, 2008). But its indirect contribution including agro-based
industries to GDP in much higher. The crop sub-sector alone contributes 11.70
percent to GDP (MoF, 2008). About 76.47 percent of the total population of this
country lives in rural areas, where agriculture is the major occupation (BBS,
2007). It is the main occupation of the people where 68.5 percent of labour force
is engaged (BBS, 2005) in agriculture. As such the national development depends
to a substantial extent on the development of its agriculture and farmers. The
population growth rate is 1.41 percent annum. The sex ratio of the population is
105 males per 100 females (MoF, 2008). The literacy rate of the country
according to 2001 census was 68 percent for population of 7 years and above.
Agricultural land is decreasing every year due to population growth, which in turn
requires more housing, urbanization, more establishments of educational
institutions, government and non-government office building, play ground and
other infrastructural development activities.
The root and tuber crops commonly grown in Bangladesh. Comprise potato, sweet
patato, aroids, yam, arrowroot and cassava (Rahman, 1999); potato is the principal
crops. Potato is the third largest crop in Bangladesh after rice and wheat and
therefore contributes much to the total food supply of tile country. It is used
primarily as a vegetable and has potential as a staple food.
Table 1.1 Share of agriculture over the year in GDP of Bangladesh.
Year Agriculture Crops Livestock Forestry Fisheries
1999-00 19.49 14.49 3.02 1.88 6.09
2000-01 19.51 14.70 2.95 1.87 5.51
2001-02 18.58 13.75 2.96 1.88 5.40
2002-03 18.22 13.43 2.93 1.86 5.25
2003-04 17.97 13.23 2.91 1.83 5.11
2004-05 17.27 12.51 2.95 1.82 5.00
2005-06 16.91 12.19 2.93 1.79 4048
2006-07 21.11 11.72 2.90 1.79 4.73
2007-08 20.87 11.70 2.79 1.75 4.67
Source: MoF, 2008 and BBS, 2006.
Within the crop sub-sector, food grains particularly the rice crops dominated the
country, agricultural scenario in respect of both area productions. At present and
rice covers 76.27 percent of total cultivated land in the country. Area coverage by
other crops are pluses 2.71 percent, wheat 4.52 percent, oilseeds 2.74 percent, jute
2.87 percent, and sugar-cane 1.15 percent, potato 1.19 percent, fruits 1.53 percent
and vegetables 1.93 percent respectively (BBS, 2004).
The consumption of the people of Bangladesh is dominated by a high degree of
rice intake. Rice alone is not capable of providing balanced and nutritious food
intake. In addition to rice, consumption of a sufficient quantity of vegetables
including potato can improve the nutrition situation in the country.
1.2 History and Overview of Potato Sector
Potato (Solanum tuberosum) is a edible tuber of the cultivated plant of the family
Solanaceae has been cultivated in this part of the sub-continent for more than a
century and has recently occupied an important place in the list of major food and
cash crop of Bangladesh (Hussain, 2008). It is assumed that Portuguese navigators
first brought potato to India Sub-continent at the beginning of the 17th century.
During the history of potato cultivation in this country, different varieties were
introduced here from different parts of the world and, in course of time, they
become degenerated and had lost their identity (Siddique, 1995). The varieties are
commonly known as indigenous potato varieties (IPV); and despite their low yield
potentiality, the IPVs are still in cultivation in this country under different popular
names. Until late fifties, only IPVs were grown here and in 1959-60 about 277
thousand MT of potatoes were produced in about 47.34 thousand hectares of land
with an average yield of about 5.96 t/ha (Hussian, 1985).
Introduction of Modern Potato Varieties (MPV) started in early sixties. Since then
the area, production and yield of potato gradually began to rise although in a slow
pace initially. In the meantime, there had been an approach of popularizing TPS
(True Potato Seed) technology in potato production with the support of CIP.
(Rashid and Rashid, 1990). There had been thorough studies on production and
utilization of TPS derived seeding tubers (Hossain, 2003), production of hybrid
TPS (Banik, 2005) and quality of hybrid TPS (Yasmin, 2006), as reported in
Ph.D. dissertations of the agricultural universities.
Sustained efforts of TCRC of BADC led to gradual development of the potato
sector of Bangladesh, particularly in respect of recommendation of varieties, seed
potato production and improvement of production technology of MPV. At present
the much higher area coverage (4.02 lac hectare) and production (66.5 lac MT)
and yield (16.6 t/ha) of potato in Bangladesh during the 2007-08. Today potato
has become one of the major food and cash crops in Bangladesh.
1.3 Importance of Potatoes in Agriculture of Bangladesh
Bangladesh is an agricultural country. Though rice and wheat are main food
crops, their production is not sufficient to meet the increasing requirements for the
growing population in the country. In this regard, potato can play an important
role as an alternative and a multipurpose food crop in Bangladesh. It also
important cash crop for the farmers. It becomes a highly successful October-
March winter crop in Bangladesh. The current potato production in Bangladesh
appears to be adequate to meet the domestic demand for potatoes in household
consumption. In 2007-08 about 8 million metric tones of potatoes were produced
in Bangladesh (BBS, 2007). The yearly per capita consumption of potato in
Bangladesh is about 24 kg (Hossain, 2008).
Potato is the leading vegetable crop in the world, which occupies the topmost
position after rice and wheat both in respect of production and consumption
(Table 1.2). Considering worldwide food grain shortage especially declining trend
of rice production, the importance of potato in the food list is increasing day by
day.
Bangladesh is now 14th among the worlds potato producers and 4th largest in Asia.
On an average, the world production of rice, wheat and potato from 1998 to 2003
were 5, 91.122.17; 5, 81245.50; and 3, 12,255.83 thousand metric tons
respectively. Potato production was 24.66 percent of the total world production of
rice, wheat and potato (Table 1.2). Rice is the dominant crop in Bangladesh, but
as production costs and cash investment in rise, the production of rice will become
too expensive for farmers in many areas.
Table1.2: World production of rice, wheat and potato, 1998 to 2003
Year Production (in, 000 tons)
Potato Rice Wheat Total * % of potato in
total productions
1998 579514 593316 300356 1473186 20.39
1999 611341 587809 300625 1499775 21.04
2000 599051 585966 328654 1513671 21.71
2001 598174 590520 312261 1500955 20.80
2002 569527 573516 320829 1463869 21.92
2003 589126 556349 310810 1456283 21.34
Average 591122.17 581245.50 312255.83 1266290.17 24.66
Source: FAO, 2003
*Total = Rice + Wheat + Potatoes
Potato may play an important role in crop diversification and therefore may
contribute to the economy and the food self-sufficiency of Bangladesh because
potato is a short duration crop in Bangladesh. Although it is difficult to change the
food habit of people within a short time, by taking potato in different forms it can
be possible to reduce the pressure on rice to a great extent. Its area and production
are increasing day by day (BBS, 2005). In declaring 2008, the international year
of the potato, the UN General Assembly seeks to focus world attention on the role
of potato in defeating hunger and poverty.
Figure 1.1 World production of rice,wheat and potato 1998 to 2003
0
200000
400000
600000
800000
1000000
1200000
1400000
1600000
1998 1999 2000 2001 2002 2003
Year
Prod
uctio
n(in
, 000
tons
)
Potato Rice Wheat Total
The future prospect of cultivation of potato in Bangladesh is quite bright. Potato is
mostly consumed as vegetable in the households in Bangladesh. There usually no
household can be found where potato is not consumed as vegetables.
Consumption of potatoes as a substitute of rice and wheat is increased during the
peak harvest season (February-March). The total requirement of potato could be
about 664800 MT in Bangladesh and its added value to agricultural sector is about
Tk. 44016 million in 2007-08 (BBS, 2007).
With the direct technical assistance of the Agro-based Industries and Technical
Development Project (ATDP) of the MoA in Bangladesh, funded by the United
States Agency for International Development (USAID) Bangladesh private
exporters have successfully exported about 130 MT of potatoes which was valued
in about Tk.2.04 million to Singapore, Malaysia and Sri Lanka in March-April of
the year 1999. For 1999-2000 and 2000-2001 Bangladesh earned about Tk.4.04
million and Tk.3.81 million by exporting potatoes respectively (Export Statistics,
1998-99).
Generally, Granula types of potato are produced in Bangladesh. However, for export
purpose, Seeds of Atlanta, Spunta and Banta type varieties are also imported to produce
high quality potatoes in the country. About 100 Small and Medium Enterprises
(SMEs) are involved in production and processing of food products of which only
10 companies export fresh potato and potato products from Bangladesh (Alam,
2006).
Table 1.3 Statement of export of potato
Year Total Export (Value in Million US$)
Exports of potatoes Quantity (in M.T.)
Value (in Thous. US$)
2002-2003 6548.44 1028 218 2003-2004 7602.99 2106 563 2004-2005 8654.52 5680 1177 2005-2006 (July-April)
8365.59 13092 3932
Source: Alam, 2006
Major export markets of Bangladesh potato and potato products are Republic of
Korea, Italy, Singapore, Malaysia, U.K. and India. Potato exporting agencies in
Bangladesh are Agriconcern, Surovi Agro Industries Ltd. (a sister organization of
Supreme Seed Co. Ltd.), BRAC and Global Agro Resources Incorporation. The
Gobal Agro Resources Incorpotation exported 5000 mt in 2006, 2500 mt in 2007,
700 mt in 2008. The vegetable and potato export program of BRAC during the
period from 1998 to 2008 exported on average 2000 mt of fresh potatoes to
Singapore and Malaysia per year. The Surovi Agro Industries Ltd., exports were
78 mt to Singapore in 2006, 192 mt to Singapore in 2007 and 486 mt to both
Singapore and Malaysia in 2008 and Agricon in 2008 they exported 3500 mt of
potatoes (KATALYST and BAU, 2009).
Earlier the price of potato was lower than rice and wheat. But in 2009, price of
potato increased significantly. Comparatively potato has a lower production cost
than rice and wheat. Potato requires 1/3rd to 1/4th of irrigation water than that of
Boro paddy or wheat. Potato is more risk avert crop than Boro paddy and wheat.
The fresh yield of potato is eight times than those rice and wheat per hectare land.
Per unit area produces about two times dry matter and calorie from potato than
those rice and wheat (Hussain, 2000).
BADC is the only public agency with a seed production program. It contributes 5
percent of the seed potato requirement. At the beginning of 1998-99, ATDP a
USAID supported project of the ministry of agriculture, started supporting private
sector seed potato production and contribution another 6 percent of the needed
quality seed potatoes (Saha, 2005). Therefore, potato seed production industries
might be set up in private sector. At present there is no formal potato processing
industries in full scale. Throughout the country, small independent shops prepare
local potato chips. Raw potatoes are cut into French fries. Existing potato varieties
can use for start up processing into potato chips as well as frozen French fries.
1.4 Varieties of potato in Bangladesh
Potato varieties that are cultivated in Bangladesh are broadly categorized into two
groups, local and high yielding. The so-called local varieties are in fact, not
strictly native.
In the distant past those were brought to this part of the subcontinent but in the
absence of varietal improvement efforts, gradually degenerated, showing poor
yield performance. In spite of poor yields, some of the local varieties are still
being cultivated because of their taste and cooking qualities. There are about 27
local varieties of potatoes cultivated in different parts of the country.
Huge amount of potato seeds are imported every year by the Bangladesh
Agricultural Development Corporation (BADC) for distribution among farmers.
Bangladesh Agricultural Research Institute (BARI) has also established a farm at
Debbiganj in Panchagar district for production of HYV seed potatoes. Following
are among the high yielding popular varieties:
a) Cardinal- probably most popular among the foreign varieties with oblong,
reddish, tubers, shallow eyes, and, smooth skin. The variety has been introduction
from Holland and has yield potential of 20-25 m tons/ha.
b) Diament-another Holland variety with oval to oblong, pale yellow tubers,
smooth skin and shallow eyes. It is quite diseases resistant. Per hectare yield
ranges from 18-24 m tons.
c) Kufri Shindhury-tubers are reddish and round and deep eyes with rough skin.
This variety was introduction from India and is comparatively less susceptible to
pests and diseases. It has a yield potential of 18 to 22 m tons/ha.
d) Other notable exotic varieties are patronis, Alpha, Archa, Multa, Ukama, Hira,
Maurin, Origo, Alisa, etc.
In recent years, the Tuber Crops Centre of BARI has collected many new varieties
of potato from the International Potato Research Centre, Peru and from other
sources. These being tested under Bangladesh field conditions to determine
whether they can be recommended for cultivation in the country. The centre has
already made good contribution towards the development of some high yielding
potato varieties.
1.5 Nutritional Facts of Potato
Potato is used as food as well as vegetables by both the poor and rich people.
Potatoes have about 620 mg of potassium. Potassium is essential to the body
because of its role in attaining optimal muscle performance and improving the
nerves' response to stimulation. Iron, essential in helping the body convert food to
energy as well as resist infection, is also present.
Potatoes are also a great source of vitamins, even supplying vitamin B and C, the
sunshine vitamin. Vitamin B6 plays numerous roles in our nervous system, many
of which involve neurological (brain cell) activity. B6 is necessary for the creation
of amines, a type of messaging molecule or neurotransmitter that the nervous
system relies on to transmit messages from one nerve to the next. Vitamin B6
plays another critically important role in methylation, a chemical process in which
methyl groups are transferred from one molecule to another. Many essential
chemical events in the body are made possible by methylation, for example, genes
can be switched on and turned off in this way. Vitamin B6 is also necessary for
the breakdown of glycogen, the form in which sugar is stored in our muscle cells
and liver, so this vitamin is a key player in athletic performance and endurance.
Vitamin C is essential to help maintain healthy connective tissue and heal
wounds. The many varieties of potatoes are also good sources of B vitamins,
helping the body make healthy red blood cells and amino acids.
Potatoes contain no fat or cholesterol and minimal sodium. Fiber of potatoes in
the skins, all those vitamins and minerals and great flavor. And a six-ounce potato
contains 2 grams of highly digestible protein, almost as much as half a glass of
milk, making it a great foundation for a whole meal. Because of the variety of
potato colors, shapes, sizes and textures and their versatility as recipe ingredients,
potatoes for breakfast, lunch or dinner (or all three) and support the daily fruit and
vegetable servings recommended for good health and nutrition.
One of the most popular nutritional myths today concerns the dietary evils of
carbohydrates. Carbohydrates are the body's primary fuel source. Muscles prefer
them and the brain relies on them. In fact, carbohydrates are so crucial to the body
that if severely cut them from other vital organs-in orders to make them.
Table 1.4: Nutritional facts of potato
Nutritional Facts
Serving size 1 potato (148g/5.30z) Amount per serving Calories 110 Calories from
Fat 0 % Daily Value Total fact 0 g 0% Saturated Fat 0g 0% Trans Fact 0g 0% Cholesterol 0mg 0% Sodium 0mg 0% Potassium 620mg 18% Total Carbohydrate 26g 9% Dietary Fiber 2g 8% Sugars 1g Protein 3g Vitamin and Mineral Vitamin A 0% Vitamin C 45% Calcium 2% Iron 6% Thiamin 8% Riboflavin 2% Niacin 8% Vitamin B6 10% Folate 6% Phosphorous 6% Zinc 2% Magnesium 6% Copper 4%
Source: http://potatoconference.com/Research.cfm
Potatoes are used in textile, paper industry and other processing industries
Glucose and dextrose are also prepared from potatoes for using in media treatment
(Thompsom and Kelly, 1957). Lactic acid, alcohol and some chemicals are now
being produced from which have a great value in chemical sciences.
From the viewpoint of nutritional requirement, Bangladesh has high deficit in
tubers and vegetables. To solve the malnutrition problem, emphasis should be
given on producing more non-cereal crops like potato. Potato has the desirable
characteristics of high yields, nutrition’s and delicious food and palatable in taste.
1.6 Area, Production and Yield of Potato in Bangladesh
In recent years, potato has occupied an important position in area allocation
because of its high yield among major food and vegetable crops of Bangladesh.
Bangladesh has made a remarkable progress in the production of potatoes during
the last two decades 1997-98 to2008-09.Considering the area coverage in the
country, potato is the third crop after paddy and wheat.
Potato area increased from 1, 36,330 hectares in 1997-98 to 4, 64,035 hectares in
2008-09 of potato has been almost triple during the same period. The average
yield per hectare also increased from 11.39 to 14.54 tons during this period. The
production and area increased due to the use of HYV seed and modern production
technology.
In 2007-08 cropping season, the highest potato area was shown and recorded the
highest Production in the history of Bangladesh.
Table 1.5 Area, production and yield of potato in Bangladesh, 1997-98 to 2008-09
Years Area(,000 ha) Production(,000 m ton) Yield (tons/ha)
1997-98 136.33 1553.00 11.39 1998-99 244.39 2752.00 11.30 1999-00 243.13 2933.00 12.06 2000-01 249.99 3216.00 12.86 2001-02 237.60 2994.00 12.60 2002-03 245.34 3386.00 13.79 2003-04 270.8 3908.00 14.41 2004-05 301.08 4161.00 13.82 2005-06 326.35 4856.00 14.87 2006-07 345.19 5167.00 14.96 2007-08 520.447 9236.835 17.75 2008-09 464.035 6746.103 14.54
Source: BBS, 2007 and Field Service Wing of DAE, 2009
A comparative picture of area, production and yield per hectare of potato in
Bangladesh along with the major potato producing Asian countries are shown in
(Table1.6). Bangladesh however, was found to be the seventh leading potato
growing country among all other Asian countries.
Table1.6: Area, production and yield of different Asian Countries, 2003
Country Area(,000 ha) Production (,000MT) Yields (Kg/ha)
Bangladesh 245 3386 1380F Myanmar 30F 338F 11267F India 1337 23161 17321F Indonesia 63 851 13550F China 4002F 66813 14842 Turky 200 5300 26500F Pakistan 119F 1946 16406F Iran 180F 3550F 19722F Japan 96F 3200F 33333F Uzbekistan 51F 760F 14902F Source: FAO, 2003 F indicates Food and Agricultural Organizations estimate.
Bangladesh has therefore, a lot to do to increase the per hectare yield. As per
DAE, potato is grown in all the districts of Bangladesh (Table 1.7). The highest
area concentration of potato is in Bogra (65,300 ha) in 2007-2008 and
contributing to 10.13 % of national total .The lowest area coverage is reported to
be in Rajbari (96 ha) in 2007-2008. The Munshigonj which is generally known as
the potato production belt of Bangladesh is gradually losing its importance in
terms of area coverage in potato, whereas districts like Bogra, Rangpur, Dinajpur,
Joypurhat, Jamalpur, Sherpur , Rajshahi , etc are gaining increasing momentum in
this respect .
Table1.7: Area, production and yield of potato in different districts of Bangladesh,
2007-08
Sl. No. Districts 2007-2008
Area (ha) Production (mt) Yield (mt/ha)
1 Dhaka 2965 53300 20.00 2 Narayanganj 4316 104663 24.25 3 Gazipur 604 10872 18.00 4 Narsingdi 2190 38325 17.50 5 Munshigangj 36045 1081350 30.00 6 Manikganj 4830 86940 18.00 7 Tangail 5343 72665 13.60 8 Mymensingh 5015 52658 10.50 9 Jamalpur 7225 123259 17.06 10 Sherpur 4025 64601 16.05 11 Netrokona 1800 18000 10.00 12 Kishoreganj 5557 68073 12.25 13 Comilla 19755 379296 19.20 14 Chadpur 16792 311156 18.53 15 Brahmanbaria 2955 52008 17.60 16 Sylhet 1900 17670 9.30 17 Mpulavibazar 2045 18957 9.27 18 Hobiganj 2031 19146 9.43 19 Sunamganj 1575 17561 11.15 20 Chittagong 3350 47905 14.30 21 Coxs bazaar 2326 32262 13.87 22 Noakhali 500 7500 15.00 23 Feni 474 7703 16.25 24 Lakshmipur 310 5751 18.55 25 Rangamati 335 4744 14.16 26 Khagrachari 520 7800 15.00 27 Bandarnban 747 11205 15.00 28 Rajshashi 35000 688800 16.68 29 Naaogaon 24440 322364 13.19 30 Natore 1724 20688 12.00 31 Nababganj 2517 31387 12.47 32 Bogra 65300 902446 13.82 33 Joypurhat 38870 645242 16.60 34 Pabna 1350 17550 13.00 35 Sirajgang 2890 35258 12.20 36 Rangpur 52720 1107120 21.00 37 Gaibandha 11840 189440 16.00 38 Kurigram 6376 127520 20.00
39 Lalmanirhat 5463 98334 18.00 40 Nilphamari 24600 369000 15.00 41 Dinajpur 42430 684820 16.14 42 Thakurgaon 24725 444061 17.96 43 Panchagarh 9960 179280 18.00 44 Jessore 4745 87023 18.34 45 Jhenaidaha 1759 26028 14.50 46 Magura 100 1327 13.27 47 Narail 200 3600 18.00 48 Khulna 595 8925 15.00 49 Bagerhat 573 8882 15.50 50 Satkira 4825 65813 13.64 51 Kustia 2806 56120 20.00 52 Chuadanga 2505 45867 18.31 53 Meherpur 1920 45043 23.46 54 Barisal 850 12750 15.00 55 Pirojpur 1143 17145 15.00 56 Jhalokathi 390 6240 16.00 57 Patuakhali 2015 44330 22.00 58 Borguna 1200 21600 18.00 59 Bhola 3185 54145 17.00 60 Faridpur 657 11826 18.00 61 Madaripur 891 16038 18.00 62 Gopalgonj 651 11067 17.00 63 Rajbari 96 1289 13.43 64 Shariatpur 3570 107100 30.00
Total 520447 9236835 17.75 Source: Field Service Wing of DAE, 2009
Considering the similarity in agro-ecological conditions, production practices and
socioeconomic conditions, six potato growing zones of Bangladesh may be
considered and they are Munshigonj, Comilla-Chandpur, Jessore-Kustia,
Rajshahi-Bogra, Rangpur-Dinajpur, and Jamalpur- Sherpur. The area
concentration of potato was the highest in Rajshahi-Bogra zone (93.2 thousand
ha) followed by Rangpur-Dinajpur (91.32 thousand ha), Munshigonj (32.7
thousand ha), Jamalpur-Sherpur (10.3 thousand ha) and Jessore-Kushtia (7.8
thousand ha) during 2008-2009 (Table 1.8).
Table 1.8: Zones wise potato production of Bangladesh, 2007-08
Zones Area (ha) Production (mt) Yield (mt/ha)
Munshigonj 36045 1081350 30.00 Comilla- Chandpur 36547 690452 18.89 Jessore- Kustia 9490 174046 18.34 Rajshahi-Bogra 100300 159246 15.86 Rangpur-Dinajpur 95150 1791940 18.83 Jamalpur- Sherpur 11250 187860 16.70 Total / Average 288782 5516894 19.77
Source: Field Service Wing of DAE 1.7 Role of Crop Diversification Program to Increase Potato Production
In the past, growth of agriculture in Bangladesh has been centered on food grain
production; rice alone comprises over 90% of that growth. Massive increase in
rice production leads to decline in area of tubers, pulses, oilseeds and other minor
crops. Realizing the importance of minor crop particularly tuber, pulses and
oilseeds for improvement of the nutritional status of the people, the government of
Bangladesh had undertaken a Crop Diversification Program (CDP) in the fourth
Five-Year Plan (1997-2002). Under the CDP strategy, emphasis has been given
on increasing production and consumption of nutrition-rich food i.e. potato, pulses
and maize. Potato production increased to 11.55 million tons in 1997-98 and to
2.00 million tons in 1998-99 from 1.5 million tons in 1996-97. The average yields
of potatoes increased from 12 tons/ha to 16.75 tons/ha. In order to increased
productions and yield of potato efforts have been made for closing the gap
between potential yield and actual yield though the introduction of improved
production technologies, development of high yielding varieties of potatoes,
promotion of diversified use of potatoes, improvement of storage and marketing
facilities, expansions of on-farm demonstration and farmers training facilities
(Planning Commission , 2000). But the diversification has not yet taken place
within the crop sector, which is still dominated by the production of cereals. At
present potatoes accounts for only 1.91 percent of the total cultivated land in
Bangladesh.
1.8 Significance of the Study
The potato was introduced in this subcontinent in the sixteenth century. It was
grown then in small plots as a vegetable. Today potato has emerged as a major
crop in Bangladesh as it adds value to agricultural sectors is about $ 44016 million
in 2007-08 (BBS 2007). Though Bangladesh has become a major potato
production in the SAARC countries, the status of this crop has remained as
vegetable in the country i.e. what it was four centuries ago. The time has come
now for all of us to understand and appreciate the role that potato can play in the
present situation of Bangladesh.
One of the major problems faced by developing countries in general and
Bangladesh in particular, is the ever increasing population. As per current trend,
the population in Bangladesh is expected to be around 172.9 million by the year
2020. In order to increase agricultural production further, the only option is to
grow high productivity crops, like potato.
Still country has been relying heavily on the major cereal crops-rice, wheat and
maize to feed the ever increasing population in our country. Such an over
dependence on cereals should be end up, to ensure food security; in the decades to
come. Dr. M.S. Swaminathan says “The present vulnerability of national food
budgets to the vagaries of weather arises from our dependence on too few crops
for our daily bread”. Potato can help widen the food supply base and thereby help
to minimize the risk of serious food shortages in the tropics and sub-tropics.
Potato, one of the most productive crops known to man can play a significant role
in ensuring foods security.
A developing country like Bangladesh needs not only the quality of food but
sufficient quantity and quality of a balanced nutritious food. It is a proven fact that
if the food available provides balanced nutrition, the food intake is relatively low,
e.g. in developed countries the food availability is not well balanced, the dietary
intake is higher because people tend to eat more to compensate for the poor
nutrition. This results in greater demand for food and higher pressure on the
limited land available to produce required quantity of food. Keeping all those
situations, the government of Bangladesh has been pursuing a crop diversification
strategy to reduce the dependency on rice and to increase the consumption of
potato. Potato is considered as an important vegetable and cash crop and has high
nutritive value. It supplies more carbohydrates in combination with many other
items of food like rice. So, it is essential to increase the potato production which
will obviously ensure the food security of the farm households along with
providing significant cash income also. Accordingly, to increase food production
it is urgently needed to give necessary support to the potato farmers. The results
of this study will be helpful to potato farmers as well as policy makers by
providing a base line results for taking appropriate decision to produce potato.
This study may also help extension workers to learn the various problems of the
potato cultivation. Therefore, concerned experts will be equipped with adequate
knowledge for giving various suggestions to the farmers.
1.9 Objectives of the Study
The objectives of the study are:
1. To document the socio-economic characteristics of potato farmers;
2. To determine the costs, returns and relative profitability of different varieties of
potato under different categories of potato farmers;
3. To determine the marketing profit of potato farmers under the present
marketing system;
4. To assess the responsible factors influencing economic returns of potato
production;
5. To identify major problems faced by the potato farmers.
1.10 Structure of the Study
The study is divided into nine chapters. After this introduction, review of
literature is presented in chapter 2. Chapter 3 deals with the research methods of
the study. A socioeconomic profile of the sample farmers and households is
presented in chapter 4. Chapter 5 deals with profitability of potato production. The
marketing system of potato presented in chapter 6. The factors affecting economic
returns of potato production is presented in chapter 7. Problem and constraints of
potato production is presented in chapter 8. Finally, chapter 9 presents the
summary, conclusion and recommendations of the study.
Chapter II
REVIEW OF LITERATURE
The focus of this chapter is to provide a selected review of the past research works
which are related to the present study. These knowledge and information give a
guideline in designing the future research problem and validating the new
findings.
Ahamed (2009) conducted a study to determine the comparative profitability of
Boro rice and potato production. The major finding of the study was that the
cultivation of the rice and potato was profitable from the view point of farmers.
The total return per hectare for Boro rice and potato were Tk. 83,320.00 and Tk.
2, 62,625.22 respectively. The gross cost of the Boro rice and potato were Tk.
54,202.74 and for potato was Tk. 1, 20,221.71. Again the net return of Boro rice
and potato were Tk. 24,117.26 and Tk. 1,42,403.51 respectively. The Benefit
Cost Ratio (BCR) was 1.41 and 2.18 respectively. The result indicates that potato
production more profitable than the Boro rice production.
Islam (2009) conducted a study on “Potato Production and Credit-A Study in
Lalmonirhat District”. The majors findings of this study revealed that potato
cultivation under the institutional and non-institutional loan was a profitable
business. The overall benefit cost ratio (undiscounted) of potato farming cane out
to be 1.42 indicating that one Tk investment resulted in a net benefit of Tk 0.42.
The findings of the study clearly indicate that the loanee farmers having large
farm holding obtained higher profit followed by medium and small farmers in the
study villages. The findings also show that science use of inputs has increased the
production of potatoes.
Firdashi (2008) conducted a study on “Alternative rice and potato production in
selected area of Rangpur district”. The major finding of the study showed that the
alternate rice and potato production was profitable. However, per hectare net
return of potato production was higher than those of Aman and Boro rice. The
study found that average daily per capital calorie was the highest for the members
of large farm households (2407 K. calorie) followed by marginal (1856 K.
calorie), small (1836 K. calorie) and medium farmers (1637 K. calorie).
Yeasmin (2008) studied the economics of potato production in a selected area of
Thakurgong district. It was estimated that per hectare costs of production were
Tk. 129327 and 113060 respectively based on ful cost and cash and basis, while
gross returns per hectare was Tk 206623 and net returns were Tk 77296 and
93563 respectively considering full cost and cash cost. Evidence showed that
potato cultivation was profitable both on full cash cost basis. The findings suggest
that most of the selected variables had significant impact on production of potato.
Huq et al. (2005) endeavored to analyze marketable surplus of potato in
Bangladesh. Cobb-Douglas type function form was tried in this study. Results of
the study indicated that marketable surplus of total production of confirmed that
total production was the best predictor in determining the level of marketable
surplus. So, emphasis should be given on increasing yield though use of improved
technology (irrigation, fertilizer) and hybrid seed with short maturation period.
Huq et al. (2004) conducted a study on “Estimation of potato Demand Elasticity
in Bangladesh”. The study employed AIDS model with corrected Stone price
Index. The income elasticity of demand for potato was 0.632. The study
compensated and uncompensated own price elasticity indicated that all food items
were price inelastic. The estimated own price elasticity implied that if the potato
price fell by 10 percent, demand for potato would increase by 8.82 percent. The
estimates of cross price elasticity indicated that the substitution effects of price
change were not quite strong. Therefore, government price interventions may not
lead to considerable price repercussions in the economy.
Majid (2004) performed an analysis on the availability and utilization of potato
credit in Bogra district. The findings of the study revealed that potato cultivation
under the institutional loan was a profitable business. It was found that the
average per acre potato production for small, medium and large farmers were 800,
740 and 760 kg respectively. The findings of the study clearly indicated that the
loanee farmers having small farm holding obtained higher profit followed by
medium and large farmers. The credit aspects of the study indicated that RAKUB
has greater contribution as financing agency to potato production than other
institutional sources of credit.
Hossain (2003) assumed the availability, utilization and repayment of potato
production loan in a selected area Mymemsingh district. The study indicates that
potato cultivation under the institutional credit become profitable. It was found
that the average per hectare potato yield for small, medium and large farmers were
30732, 28934 and 28043 kg respectively. The findings of the study cleared that
the small loanee farmers secured the highest profit. The findings also showed that
scientific use of inputs increased the Production of potato. The study also found
that Sonali Bank had the greater contribution agency to potato Production than
other institutional sources.
Rajput et al.(2003) conducted a study on the relative profitability of different
potato cultivars ( Kufri Lavkar, Kufre joyti and Sindhuri). Amonng the cultivars,
the overall returns ( Rs 23333378) and quintal was estimated to be lowest in Kufri
Sindhuri, Kufri joyti recored the highest over all gross returns per hectare (Rs
19966) and Kufri Siindhuri recored the highest overall net returns per hectare. The
overall profitability in terms of benefit cost ratio for Kufri Sindhuri, Kufre joyti
and Kufri, Lavkar were estimated as 1.40, 1.36 and 1.34 respectively.
Akhter et al. (2001) investigated the production practices, input use, costs,
returns and constraints potato production in 5 locations in Bangladesh viz,
Rangpur, Bogra, Jessore, Mymensingh and Comilla. The results showed that
potato production was highly profitable and it could provide cash money to
farmers. In terms of profitability, potato production is more attractive than the
other winter vegetables .Per unit yield and gross returns of potato were found
higher than those of other competitive crops.
Borouya (2001) conducted a study entitled “Area, Yield and Production Growth
of Potato in Bangladesh: A Quantitative Estimation”.The study estimated
quantitative growth and instability of areas, yield and production of potato
utilizing the time series data from 1981-42 to 1997-98. It carried out a
disaggregated analysis to compute the status of the parameters according to high
concentration region (HRC), medium concentration region (MCR) and low
concentration (LCR). The findings showed that area, yield and production indices
of local potato decreased in HCR, LCR, LCR and aggregate (Bangladesh as a
whole) category while it was almost stagnant in MRC category. These indices of
Indian variety potato increased in all the categories except MRC however that of
modern potato showed the increasing trend.
Rahman (1999) carried out a study on “Economic Analysis of Potato production
is Some Selected Areas of Rangpur District”. The study was mainly designed to
analyze the socioeconomic characteristics of potato farmers and to determine the
costs and returns of producing HYV potato according different varieties and
different categories of farmers and identifying the factors affecting yield and
returns. One hundred twenty potato farmers were selected as sample. Findings
showed that, the total costs Tk. 84291.85 per hectare was the highest for the large
farmers growing Cardinal and it was the lowest Tk.56760.85 for the small farmers
growing the same variety. The gross return Tk. 113333224.80 per hectare was the
highest for the large farmers producing BARI TSP 1.On the contrary, the gross
return Tk.95759.16 per hectare was the lowest for the small farmers producing
Diamant. The functional analysis showed the effects of using human labour,
animal power, manure, seed and irrigation were positive for Diamant production.
Arif (1998) conducted an economic study on potato production in selected areas
of commilla District. He found that with or without irrigation made virtually no
difference (hardly Tk. 500.00 per hectare) in the terms of gross costs and returns.
The estimated gross costs per hectare amounted Tk. 64,833.83 with irrigation and
Tk 63,697.08 with no irrigation, return per were Tk. 99,902.04 with irrigation and
Tk 98,097.02 without irrigation condition and Tk. 34,399.94 without irrigation.
Singh et al. (1998) estimated the growth rates for wheat, potato, rice and
sugarcane in different regions of the state of Uttar Pradesh during the period
1969-70 to 1989-90. The study showed that compound growth rates of area,
production and productivity were positive in all regions and the state as a whole.
The study concluded that the growth rates of area, production and productivity of
potato in Uttar Pradesh were 4.872, 10.859 and 5.693 per annum respectively.
Das (1992) conducted a study on the profitability of potato cultivation and found
that the average the yield of potato was 4720 kg per hectare and the average gross
return amounted to Tk. 33040 per hectare. He further calculated the per hectare
net return over full-costs at Tk. 11085.89. The best yield was obtained by sowing
seeds during the last week of October and first week of November.
Above review and discussions indicate that there are large numbers of studies
conducted on profitability of potato production. The present study was conducted
on present status and potentialities of potato production. This study is a moderate
attempt to find out the relative costs and returns of growing potato at farmers field
in selected areas of Jamalpur and Sherpur districts. Under the circumstances, the
present study could be treated as a pioneering attempt and the findings of the
present study are expected to provide useful information for the researchers and
policy makers.
Chapter III
METHODOLOGY OF THE STUDY
The reliability of a research depends on the proper methodology. So, methodology
is very important for any research process and has to be chosen carefully to fulfill
the purpose of the study. Methodology should be such that it would enable the
researcher to collect valid and reliable information and analyze those data to
arrive at correct decision. To achieve the expected outcomes of the research use
both primary and secondary data. A farm management study is usually involves
on field level primary data. The type and nature of data to be collected depends on
the objectives of the study. Although there are some other methods for collecting
data from the field level, the survey method was chosen for this study considering
limitation of time, shortage of money, easy access to the study area and
availability of other facilities. Methods used for data collection was interviewing
respondents, as the farmers of Bangladesh do not keep written record of their farm
operations, the investigator had to rely upon the memory of the respondents.
Secondary data of difference sources including national and international
organizations such as BBS, FAO, KATALIST and DAE were used.
Methodology deserves a very careful consideration in any scientific research. The
methodology of the present study involved the following steps:
3.1 Selection of the Study Area
Selection of the study area is an important step of methodology. To achieve the
objectives of the present study, Bakshiganj upazila of Jamalpur district and
Sherpur sadar upazila of Sherpur district were selected. Then two villages namely
Noymia under of Bakshiganj upazila and Kusumhati under Sherpur sadar upazila
which are the most neighboring villages were selected purposively. The
researcher selected these villages because of
(i) Availability of farmers growing potato and easy communication and good
transportation facilities,
(ii) The researcher was familiar with socioeconomic characteristics of the
farmers in the selected villages. The expected cooperation from the
respondents would be high so that reliable data would be obtained, and
(iii) No previous study of this type was carried out in this area.
3.2 Selection of the Samples and Sampling Technique
It is impossible to make a farm survey covering all the farmers producing potato
in the study area due to limitation of time, money and personnel. For this reason,
sampling technique was followed to select representative farmers to minimize
time and cost of the study. In total, 60 sample farmers were selected randomly.
First, two different villages namely Noymia under of Bakshiganj Upazila of
Jamalpur district and Kusumhati under Sherpur sadar Upazila of Sherpur district
were selected purposively, then prepared a list of potato farmers, from the list of
potato farmers, 60 potato farmers were selected randomly for data collection.
Then, the sample farmers were divided into three categories according to land
holding. Based on the classification of DAE and the area of potato cultivation, the
potato farmers of each area were classified into three categories depending on size
of land holding larger farmer, medium farmer and small farmer and their size of
holding mention follows:
Small farmer: the farmer having total land of 0.02-1.00 hectare and above and
produced potato at leased 0.20 hectare of land.
Medium farmer: the farmer having total land of 1.01-3.03 hectare and above and
produced potato at leased .04 hectare of land.
Large farmer: the farmer having total land of 3.04 hectare and above and
produced potato at leased 0.81 hectare of land.
Farm size = Own cultivable land + Lease in + Mortgaged in – Lease out –
Mortgaged out
The primary data were collected through personal interviewing of the selected
farmers of these three categories. Then 38 small farmers, 16 medium farmers and
6 large farmers were selected randomly. Thus, the total sample size was 60 potato
farmers. The sampling design and distribution of sample farmers are shown in
Table 3.1.
Table 3.1: Sampling design and distribution of sample farmers
Categories of potato farmers
No of farmers Total
Jamalpur Sherpur
Small farmers 19 19 38 Medium farmers 8 8 16 Large farmers 3 3 6 All farmers 30 30 60
3.3 Data Collection Instruments
Keeping in view the expected outcomes of the assessment survey, appropriate
data collection instruments were prepared. Interview schedule was prepared to
collect primary data from the potato farmers. The schedule was pre-tested and
modified accordingly before final use. The interview schedule was prepared in
such a way that all aspects associated with the objectives could be included. A
draft schedule was pre-tested. In the pre-test survey, attention was paid to identify
any new information, which was not included in the draft schedule. Then some
parts of draft schedule were improved, rearranged and modified in the light of the
experience gained from the field. Lastly, the final interview schedule was
prepared to collect information. The framing of the questions in interview
schedule was done in such a way, that they could be easily understood by the
informants and their responses could be quicker. Besides, leading questions were
avoided; questions pertaining to the private and personal life of the respondents
were also not included in the schedule. The questions were properly structured, so
that even the most reluctant informants could have no hesitation in passing the
necessary information. The questionnaire included the following items of
information needed for the analysis.
a) Identification of sample farmer;
b) Farm size and tenure status of sample farmer;
c) Use of material inputs for cultivation of potato;
d) Yield, output, cost and returns of producing of potato;
e) Problems faced by the potato growing farmers and suggested solution.
3.4 Collection of Data
The study was based on a set of field level primary data which were collected
from the selected farmers through direct interview with the help of pre-designed
and pre-tested interview schedule designed for this study. The data were collected
during the period from July to August, 2009. A brief introduction regarding the
nature and objectives of the study was given to each respondent before interview.
The respondents were given assurance that all information would be kept
confidential, be used exclusively for research purpose and the study will not affect
their interest in any adverse way, rather it might produce some benefits to general
mass in course of time. Before interviewing, the selected respondents were
contacted so that they could be interviewed according to their convenient time.
Then the questions were asked systematically in a very simple manner with
necessary explanation and the information provided by the respondents was
recorded directly on the schedule. After completion of each interview the
interview schedule was cheeked to be sure that information to each of the items
had been properly recorded. Any items overlooked or found contradictory were
corrected in the second visit. The secondary data were collected from the
Bangladesh Bureau of Statistics (BBS, 2008), Population Census reports, the daily
newspapers, DAE, published and unpublished articles, etc.
3.5 Processing and Analysis of Data
After collecting requisite data, they were processed and analyzed with a view to
achieve the objectives of the study. The primary data collected from the potato
farmers were processed (edited and coded) and computerized using MS Excel and
SPSS 11.5 (Statistical Package for Social Survey). All the collected qualitative
and quantitative data were analyzed in accordance with the objectives of the study
so as to answer the issues involved in the study.
3.6 Analytical technique
Both tabular and statistical techniques were used to analyze the collected data.
3.6.1 Tabular techniques
Tabular technique that is commonly followed to find out the crude association or
differences between variables and outputs. Tabular technique is a well known and
widely used technique to show the result of farm management study because it is
simple, convenient and very easy to understand. The data and information so
collected were recorded to tabular form which included classification of tables
into meaningful results by some statistical measures like the sum, average,
percentage etc. to show the relationship between/among the selected variables.
Tabular analysis was done to address the first three objectives of the study. On the
other hand, statistical analysis was employed to determine the factors influencing
production of potato.
Gross return was calculated by multiplying the total volume of output by the
average price in the harvesting period. It consisted of sum of the volume of main
product and by product. The following equation was used to estimate the gross
return (GR):
GRi = ∑=
n
imimiPQ
1
Where,
GR1 =Gross return from ith product (Tk/ha);
Qmi = Quantity of the ith main product (kg/ha);
Pmi = Average price of the ith main product (Tk/kg);
i = 1, 2, 3… n
Gross margin has given an estimate of the difference between total return and
variable costs.
That is,
GM= TR-VC
Where,
GM = Gross margin;
TR= Total return;
VC = Variable cost.
The argument for using the gross margin analysis is that the farmers of
Bangladesh are more interested to know their return over variable costs.
Moreover, gross margin is widely used in short run analysis as well as farms
planning. This analysis is early understandable for its simplicity.
Net return analysis considered fixed cost; land use cost, interest on operating
capital, etc. Net return was calculated by deducting all costs (variable and fixed)
from gross return. To determine the net return of potato production the following
equation was used in the present study:
∑=
−−=n
ixi TFCPPyY
1)(π
Where,
π = Net return (Tk/ha);
Py = per unit price of the product (Tk/kg);
Y = Quantity of the product per hectare (kg);
Pxi = per unit price of ith inputs (Tk);
Xi = Quantity of the ith inputs per hectare (kg);
TFC = Total fixed cost (Tk);
i = 1, 2, 3… n (number of inputs).In this study cost and return analysis were done
on both variable and total cost basis. To achieve the objective of the study a
simple tabular analysis was accomplished. The following profit equation was
developed to assess the profitability of potato cultivation.
π = Gross return – (Variable cost + Fixed cost)
Here,
π = Profit per hectare
Gross return = Total production × per unit price
3.6.2 Summarization and tabulation of data
The first job was to scrutinize the data of each and every questionnaire to find out
any inconsistency or omission in the data set and to avoid irrelevant information.
Processed scrutinized data were transferred to a master sheet and compiled with a
view to facilitating tabulation. It may be noted here that many information were
collected initially in local units, and after checking, those were converted into
standard units.
3.7 Statistical Techniques
The production of potato is likely to be influenced by different key inputs. The
Cobb-Douglas production has been chosen to estimate the contribution of input
used in potato production of farmers. In this analysis, output (gross return) was
considered as “dependent variable” (Islam el.al.2007). consistency of the double
log model the applicability of the model more reliable. A multicolinerity test was
performed to predict the correlation among the importanes independent variables
in the mode.
Specification and measurement of variables
To explore the input-output relationship of potato production stochastic frontier
production function (a modified Cobb-Douglas form of production function) form
was expressed as (Gujarati, 2003):
The specified stochastic frontier production function used in present study is explained
as followings:
lnyi = lnβo + ∑ =
6
1jβj l n Xij + ∑ =
2
1mβm Dim +єi , i= 1, 2. 3............N
Here, i=ith Potato grower
J= jth Input (j=1, 2, 3, 4, 5, 6)
βo= Coefficient of different variables
βm= Coefficient of different dummy variables (m= 1,2)
yi= Return from potato of ith farmer (Taka)
Xi1= Seed cost (Taka)
Xi2= Human Labour cost (Taka)
Xi3= Power tiller cost (Taka)
Xi4= Fertilizer cost (Taka)
Xi5= Insecticide cost (Taka)
Xi6= Irrigation cost (Taka)
Dm1 = Dummy for small potato farmers if land holding 0.02-1.00 hectare then l,
otherwise 0
Dm2 = Dummy for medium potato farmers if land holding 1.01-3.03 hectare then
1, otherwise 0
ei= Error term
N = 60
In = Natural logarithm
Returns to scale
Since the concept of the functional coefficient requires a proportional change in
all variable inputs, it is useful in considering returns to scale.
R2 and adjusted R2
R2 can be computed by the following formula,
R2 =1- and)y-i(y
ie2
2
∑∑
The adjusted coefficient of determination can be estimated which is as follows:
Adjusted R2 =1- 1)i/(Ny
K)i/(Ne2
2
−
−
∑∑
Where,
∑ ei2 = Residual sum of squares
∑ yi2 = Total sum of squares
K = The number of parameters in the model including intercept term.
N = Number of the total observations 3.8 Procedure for Computation of Costs and Return
Variable costs
i. Hired human labour
ii. Power tiller
iii. Seed
iv. Fertilizer
v. Insecticides
vi. Irrigation
vii. Land use cost
Fixed costs
I. Family labour
II. Interest on operating capital
Both cash costs and full cost were considered in enterprise costing techniques.
Full costs included cost of all inputs whether purchased or not.
3.8.1 Variable costs
i. Cost of human labour
Human labour was found to be the major input in producing potato. Human labour
was classified as family labour for which cash payment was not made and hired
labour for which the farmers had to pay cash. To determine the cost of unpaid
family labour, the opportunity cost of labour was normally considered. However,
a number of researchers used the prevailing wage rate of hired labour for
estimating family labour cost which included the value of necessary privileges in
addition to the cash payment. Information of each payment for hired labour was
collected on the basis of actual cost. In this study 8 hours period was considered to
be one labour man day. The wage rate varied from Tk. 50 to Tk. 150 depending
on the season and availability of day labours. However, the average wage rate was
considered to be Tk. 135.
ii. Cost of power tiller
Power tiller was used by the farmers for land preparation to producing potato.
There was a competitive rate for power tiller use in the study area. The payment
involved charge for the use of power tiller and the driver. It was very difficult to
separate the cost for the power tiller and the driver. A power tiller owner supplied
fuel as well as driver for land preparation. The farmers paid the charge for power
tiller use at a fixed rate 134.33 Tk. per acre in the study area.
iii. Cost of seed
The sample farmers mostly used home supplied seeds but in some cases
purchased seeds were used by the farmers in producing potato. The costs of home
supplied seeds were determined at the present market rate in the study area and
costs of purchased seeds were calculated on the basis of prices paid by the
farmers.
iv. Cost of fertilizer
Fertilizers and manures namely Urea, TSP, MP, Gypsum and cow dung were used
by the farmers. Fertilizer cost varied according to actual price paid by the
individual farmers and the amount of fertilizers they used. Cost of these fertilizers
was estimated according to the cash price paid by the farmers.
v. Cost of insecticides
Most of the farmers used insecticides in producing potato. Some farmers in the
study areas used various insecticides. The costs of various pesticides were
computed on the basis of price which farmers actually paid for it.
2productionofPeriodinterestofRatecapitalOperating ××
vi. Cost of irrigation
All the farmers in the study area used irrigation water for producing potato. In the
study area, there was only one system of payment for irrigation. This was cash
payment per unit of land. The cost of irrigation was computed form the hiring
charges per unit of land and net fuel cost paid by the owner of irrigation
equipments.
vii. Land use cost
The cost of land use was different for different plots depending upon the location,
topography and fertility of soil. The cost of land use may be estimated by using
any of the following concepts.
a) Interest on value of land
b) Valuation of land at its rental price
For this study, cost of the land use was accounted for by taking the rental value of
land.
3.8.2 Fixed cost
i. Interest on operating capital
Interest on operating capital was calculated by taking into account the cost
incurred for all the field operations.
The formula was used as follows:
Interest on operating capital =
The interest was charged at the rate of 10 per cent per annum. Five months were
considered for potato production. The period considered for an enterprise ranged
from the time of land preparation to the harvesting of the crop.
3.8.3 Procedure for estimating of return
Per hectare gross return was calculated by multiplying the total amount of
products by their respective average market price. Gross return per hectare
consisted of the values of products. The net return was estimated as net return
above cash cost and net return above full cost. Excluding the cash expenses from
the gross return, the return above cash cost was derived. The net return above full
cost was calculated by deduction all cash and non-cash expenses from gross
return.
Chapter IV
SOCIOECONOMIC CHARACTERISTICS OF THE POTATO
FARMERS
The aims of chapter is to highlight the major socioeconomic aspects such as
family size and composition, classification of family members, level of education,
occupational status, land holding, etc of selected sample farmers.
4.1 Age Distribution of the Potato Farmers
Age of the respondents is an important factor in involvement in any income
generating activity. The farmers were classified into four age groups i.e.
distribution of sample farmers, 18 to 24 years, 25 to 45 years, 46 to 60 years and
above 60 years.
Considering all sample farmers, age of 18 to 24 years were 5, 25 to 45 years
were50, 46 to 60 years were 42 and above 60 years were 3 percent respectively
(Table 4.1).
4.1 Distribution of selected potato farmers according to age groups
% distribution of farmers reported
Age groups Small
farmers n=38 Medium
farmers n=16 Large farmers
n=6
All categories
n=60 % % % %
18-24years 5 6 - 5 25-45years 55 50 33 50 46-60years 37 42 17 42 Above 60years 3 2 - 3 All groups 100 100 100 100
Source: Field survey 2009 It appears from Table 4.1 that, most of the farmers belonged to 25 to 45 years age
group and they were active and young. Few farmers were found aged above 60
years who represent 3 percent for small farmers and that of 2 percent for medium
farmers. No large farmer was found above the age group of above 60 year.
4.2 Level of Education of the Potato Farmers
Education was considered as the key factor for transforming technology.
Education was defined as the ability of an individual aged above 6 years to read
and write or formal education received up-to certain standard.
Considering all farmers about 27 percent farmers were illiterate and that of 3
Percent farmers completed graduation degree. About 7 to 13 percent farmers had
education of SSC and HSC level. The percentages of illiterate farmers were 36, 7
and 17 percent for the small, medium and large farmers respectively. However,
primary level both for small and medium farmers was 18 percent. Since here, the
secondary class completed of 33 percent total of all farmers (Table 4.2).
Table 4 .2: Level of education of potato farmers
% distribution of farmers reported
Education
Small farmers n=38
Medium farmers n=16
Large farmers n=6
All farmers n=60
% % % %
Illiterate 36 7 17 27 Primary 18 18 - 17 Secondary 29 50 17 33 S.S.C 11 13 33 13 H.S.C 6 6 17 7 Graduate and above
- 6 16 3
All groups 100 100 100 100 Source: Field survey 2009 4.3 Occupational Status of the Potato Farmers
The sample farmers engaged various types of occupations. The occupation of the
farmers and farmers family’s members were classified such as agriculture,
business, service and other (i.e. small trading, tailoring, day laboring, van pulling
and rickshaw pulling, etc)
Table 4.4 Occupation status of the sample potato farmers and family members of the potato farmers
% distribution of farmers reported
Occupation groups
Small farmers n=38
Medium farmers n=16
Large farmers n=6
All farmers n=60
% % % % Agriculture 66 63 50 65 Business 13 12 33 15 Service 5 6 17 5 Others 16 19 - 15 Total 100 100 100 100
Source: Field survey 2009 Agriculture was found to be the inherent and single major occupation of almost al
the farmers in the study areas. A bulk of the total labour force was engaged in
agriculture. Only a small portion of the farmers families were found to have dealt
with business, services and other occupations (Rickshaw/ Van pulling, Day
labouring, Tailoring, Petty business, etc) in addition to agriculture. Tables 4.3
shows that the occupational classification of the farmers according to size of land
holding. It shows that 65 percent of the farmers had agriculture as the single main
occupation. Whereas, 15 percent, 5 percent and 15 percent were engaged of the
business, service and others occupations respectively.
4.4 Size and Composition of Family of Potato Farmers
A family in the present study was defined as a group of persons living together,
taking meals from a single kitchen and living under the control of one head. If any
person of a family is employed outside home but take meals from the same
kitchen while at home and shares the income and expenditure of the family,
he/she has been considered to be a member of that family .Considering all family
members of potato (Table 4.4), age group below 15 years it was 41, 26 and 34
percent for small, medium and large farmers respectively. Total family members
of small, medium and large farmers were 257, 104 and 38 among them age group
15 to less than 60 years constituted the largest portion of members of potato
farmers irrespective of farm size and it was 59, 85 and 66 percent for small,
medium and large farmers respectively. In this age group, the most of the family
members are related with various economical activities in the society (Table 4.4).
Table 4.4: Family members and age distribution of households members of potato farmers
% distribution of farmers reported Categories of farmers
Family members (No)
>15 years
15-60 years (Working members)
(% % Small farmers 257 41 59 Medium farmers 104 26 85 Large farmers 38 34 66 All farmers 399 28 72
Source: Field Survey, 2009 4.5 Educational Level of the Family Members of the Potato Farmers
Table 4.5 reveals that only 22 percent members are illiterate. Family member
having primary, Secondary, S.S.C, H.S.C and above education were found to be
24, 22, 17 and 9 percent respectively. Among the illiterate family members, small
and medium farmer holders were the higher whereas larger farmers constituted
the highest among those who have to H.S.C and above level of the education
during the investigation.
Table 4.5: Educational level of the potato farmers family members
% distribution of farmers reported
Level of education
Small farmer Medium farmer Large farmer All farmers % % % %
Illiterate 25 22 13 22 Primary 24 22 24 24 Secondary 20 24 32 22 S.S.C 16 17 16 17 H.S.C 9 10 10 9 Graduate and above
6 5 5 6
All groups 100 100 100 100
Source: Field survey, 2009
4.6 Average Size of the Land Holding of the Potato Farmers
Land is the most important asset for farmer household. Land was used for
producing diversified crops and productive enterprises. Sample farmers were
categorized into three groups according to total land owned by them. According to
Yang (1995) “Farm size is measured by the entire land area operated by the
operator.”
Table 4.6: Average size of the land holding of the potato farmers
Land category
Small farmers (ha)
Medium farmers (ha)
Larger farmers (ha)
All categories(ha)
Own land 0.436 1.211 2.62 1.422 Rent in /Lease in
0.230 0.804 1.039 0.691
Homestead 0.074 0.195 0.157 0.142 Pond 0.026 0.024 0.026 0.025 Other( garden, pasture etc)
- 0.04 0.30 0.11
Farm size 0.766 2.275 4.142 2.394 Source: Field survey 2009 It computed by adding the area of land owned, rented in and mortgaged in farm
from others and subtracting the area rented out and mortgaged out to others. It
may be noted that, sample farmers did not lease out or rented out in the study area.
Thus the farm size was measured by using the following formula:
Farm size= Own cultivable land + Lease in + Mortgaged in – Lease out –
Mortgaged out
Table 4.6 reveals that the average farm size for small farmers stood at 0.766
hectares; while it was 2.275 hectares for medium farmers and 4.142 hectares for
large farmers, respectively. It also indicates that the average farm size in the study
area was 2.394 hectares.
Chapter V
PROFITABILITY OF POTATO PRODUCTION
The main purpose of this chapter is to assess the per hectare cost, return and
profitability of potato production in the study area. Cost of inputs used for
producing a crop play an important role in farmers decision making. Cost of
potato production very from variety to variety. In the study area all potato farmer
practices production of Diament variety potato for availability of seed and
climatic condition. Farmers used both purchased and home supplied inputs for
producing potato. Both inputs and outputs were valued at the farm gate price
during the survey period. It was easier for a farmer to determine the cost of the
purchased inputs like seed, fertilizer, insecticide etc. But it was not so easy to
determine the cost of home supplied inputs like family labour, animal labour, etc,
for which no payment was actually made. For solving this problem of such home
supplied inputs the principle of opportunity cost was employed in this study.
5.1 Production Cost
5.1.1 Cost of human labour
The wage rate was varied from Tk. 50 to Tk 130 per man day depending on the
season and availability of day laborers. Considering the causes of variation, it was
estimated average cost estimated to be Tk. 125 per day and for women labour it
was about Tk. 84. Labours required for different farm operations were like land
preparation, sowing, mulching, weeding, irrigation, insecticide application,
application of fertilizer, harvesting, carrying, etc.
In the case of potato production, total human labour requirement were 216, 187
and 226 man-days per hectare and among them women labour were 86, 57 and 97
man-days of small, medium and large farmers of potato production respectively.
The per hectare costs of hired labour were Tk.13,165.00, Tk.13,327.00 and
Tk.22,453.00 which representing 8.03, 7.9 and 12.67 percent of the total cost for
small, medium and large categories farmers respectively. Other hand, the per
hectare costs of permanent (family labour) labour were Tk.10,395.00, Tk.7597.00
and Tk.2,250.00 which representing 6.33, 4.50 and 1.27 percent of total cost for
small, medium and large categories farmers respectively (Tables 5.1, 5.2, 5.3).
This indicates that the large categories farmers are use hired labour more than
small and medium categories farmers and most of the small categories farmers are
labouring their own land cultivation.
5.1.2 Cost of seed
The cost of seed is one of the basic cost items for potato production. In the study
area, the seed cost per hectare was found to be highest for medium farmers
amounted Tk. 41,838.00 followed by small farmers Tk. 35,117.50 and large
farmers Tk. 36612.37 which were representing 21.38, 24.81 and 23.50 percent of
the total cost for small, medium and large farmers respectively (Tables
5.1,5.2,5.3).
5.1.3 Cost of power tiller power
Power tiller was used in lieu of animal power. It is a time saving modern tillage
technology. Per hectare average power tiller cost was Tk. 3330.37 which shared
2.03, 1.97 and 1.88 percent of total cost for small, medium and large potato
farmers respectively. So, power tiller cost per hectare was the highest for small
farmers followed by the large farmers and medium farmers (Tables 5.1, 5.2, 5.3).
5.1.4 Cost of fertilizer
In the study area, farmers used four types of fertilizer namely urea, triple super
phosphate (TSP), mediate of potash (MP) and gypsum for potato cultivation.
Fertilizer cost was determined by the actual market prices paid by the farmers.
The average per kg price of those fertilizers was Tk. 12.00, 56.05 and 6.00 for
small, medium and large potato farmers respectively. Thus the respective total
average cost of fertilizer per hectare stood at Tk. 38,190.25, Tk. 38, 722.05 and
Tk. 42, 995.30 representing 23.29, 22.91 and 24.26 percent of the total cost
(Tables 5.1, 5.2, 5.3) in the study area fertilizer cost per hectare was the highest
for large farmers followed by small and medium farmers.
5.1.5 Cost of manure
In the study area, the potato farmers only used cow dung as manure. Cow dung
cost per hectare was the highest in large farmers Tk.1920.00 followed by small
farmers Tk. 1560.00 and medium potato farmers Tk. 1580.00. The average cost of
cow dung for small, medium and large potato farmer constituting 0.95, 0.94 and
1.08 percent of total cost respectively (Tables 5.1, 5.2, 5.3).
5.1.6 Cost of insecticides
All sample potato farmers used insecticides in their potato fields. They used
different kinds of insecticides namely Sundronil, Indrotil, Comigrin, Tiodit, etc.
The price of the insecticides largely varied from brand to brand. The total average
cost of insecticide per hectare was Tk. 13500.00 for all categories of potato
farmers which representing 8.23, 8.00 and 7.62 percent of total cost for small,
medium and large farmer respectively. So, the highest insecticide cost was borne
by small farmers followed by large and medium farmers (Tables 5.1, 5.2, 5.3).
5.1.7 Cost of irrigation
Potato farmers in all the villages used irrigation water in the potato fields during
cultivation period. It may be noted here that maximum of the selected farmers had
to buy water from the owners of shallow tube-wells (STWs) and a few of them
had their own STWs. The average per hectare cost of irrigation for all categories
was Tk 17,500.00 of and it was almost the same for small and medium farmers.
The cost of irrigation constituted 10.67, 10.38 and 9.88 percent of total cost for
small, medium and large farmers (Tables 5.1, 5.2, 5.3). The cost of irrigation was
the lowest for large farmers followed by small and medium farmers.
5.1.8 Land use cost
Some of the potato farmers leased in land for study year and they had to pay a
certain amount of money per hectare of land. Other farmers produced potatoes on
their own land. Land use cost was estimated for the cropping period covering 5
months in the study area. The average per hectare land use cost for all categories
was Tk. 27,664.00 which representing 16.87, 16.41 and 15.61 percent of total cost
for small, medium and large farmers respectively. So, the highest land use cost
was borne by small farmers followed by large and medium farmers in the study
area.
5.1.9 Interest on operating capital (IOC)
IOC included both labour and materials used in the production of potato and were
calculated for a period of four months at the rate of 13.00 percent per annum. It
was assumed that if the farmers borrowed money from bank and other financial
and non-financial institutions, they had to pay interest at specified rate. This rate
was taken to calculate IOC. IOC per hectare was estimated at Tk. 3010.54,
Tk.3059.23 and Tk.3430.29 for small, medium and large potato farmers and
which comprising 1.84, 1.81 and 1.98 percent of the total cost for small, medium
and large farmers respectively (Tables 5.1,5.2,5.3).
5.2 Total Cost (TC)
The total cost was worked out for each category of potato farmers and is presented
in table (5.2, 5. 3, 5.4). The average per hectare total cost of potato production was
estimated at Tk.163932.64 for small farmers, Tk.168971.78 for medium farmers
and Tk.177194.76 for large farmers. So, large farmers incurred the highest cost
followed by the small and medium potato farmers.
5.3 Gross Returns (GR)
Gross return from potato production was defined as the sum of the returns from
maim product as potato. The average per hectare yields of potato were 18988.52
kg, 19302.99 kg and 19520.58 kg and sale prices of per kg potato were Tk. 15.17,
Tk. 15.60 and Tk.16.00 for small, medium and large farmers in the study area.
Returns from main product (potato) were Tk.2, 88,055.85, Tk.3, 01,126.64 and
Tk.3, 12,329.28 for small, medium and large farmers respectively.
5.4 Gross Margin (GM)
Gross margin is defined as the difference between gross return and variable costs.
Farmers generally want to maximize return over variable cost of production. Per
hectare gross margins from potato production were estimated at Tk.1,37,528.73
Tk.1,43,165.24 and Tk.1,40,814.81 for small, medium and large potato farmers
respectively in the study area (Tables 5.1, 5.2, 5.3).
5.5 Net Returns (NR)
Net returns were obtained by deducting total cost. Per hectare net returns of potato
were Tk.1, 24,123.19, Tk.1, 32,509.01 and Tk.1, 35,134.52 for small, medium and
large farmers respectively in the study area (Tables 5.1, 5.2, 5.3).
5.6 Benefit Cost Ratio (BCR)
In the study area, BCR was the highest for medium farmers compared of small
and large farmers because of better management system which were 1.75, 1.79
and 1.76 for small, medium and large farmers respectively (Tables 5.1, 5.2, 5.3).
5.7 Profits
Profit (Tk/kg) of potato production means the different between per kg selling
price of main product (potato) and per kg production cost. In the study area,
profits were Tk/kg 6.54, Tk/kg.6.87 and Tk/kg 6.92 for small, medium and large
potato farmers respectively. So, large farmers incurred the highest profit (Tk/kg)
followed by small and medium farmers (Tables 5.1, 5.2, 5.3).
5.8 Comparative Economic Returns of Producing Potato by Different
Categories of Farmers
The per hectare gross return and net return were found to be highest for large
farmers which were Tk. 312329.28 and Tk. 135134.52, followed by small farmers
which were Tk. 288055.85 and Tk. 124123.19, medium farmers found to be Tk.
301126.64 and Tk. 132509.01 respectively, due to high production and high per
kg market price of potato. Total variable cost and total cost were highest for large
farmers which were Tk. 171514.47 and Tk. 177194.76 because more use of hire
labour and high cost of seed and fertilizer followed by small and medium farmers.
Profit Tk/kg of potato was higher large categories farmers than those of small and
medium farmers. The undiscounted benefit cost ratio (BCR) highest for medium
farmers. Potato production was highly profitable business for medium farmers
followed by small and large farmers.
Table5.1: Per hectare cost and returns of potato production for small potato farmers
Items Unit Quantity
Price per unit (Tk)
Total value (Tk)
% of the total cost
Gross Cost Hired labor Male Man-days 72 125.00 9000.00 5.49 Female Man-days 49 85.00 4165.00 2.54 Power tiller - - - 3330.37 2.03 Seed Home supplied
kg 285.12 22.00 6272.64 3.82
Seed Purchased kg 1311.13 22.00 28844.86 17.56 Urea kg 320 12.00 3840.00 2.34 TSP kg 295 56.45 16652.75 10.15 MP kg 315 54.00 17010.00 10.37 Gypsum kg 125 5.5 687.50 0.42 Manure Cow dung kg 3120 0.50 1560.00 0.95 Insecticides - - - 13500.00 8.23 Irrigation - - - 17500.00 10.67 Lease value - - - 27664.00 16.87 Others (ash, replacing bad seedling etc )
- - - 500.00 0.30
A. Total Variable Cost 150527.12
91.77
Fixed Cost Family labour Male Man-days 58 125.00 7250.00 4.42 Female Man-days 37 85.00 3145.00 1.91 IOP - - - 3010.54 1.84 B. Total Fixed Cost 13680.21 8.17 C. Total Cost (A+B)
13405.54 100
Gross Return Main product kg 18988.52 15.17 288055.85 - D. Gross Return 288055.85 - E. Gross Margin(D-A)
137528.73 -
F.Net Return (D-C)
124123.19 -
G .Cost Tk/kg 8.63 - H. Profit Tk/kg 6.54 - I.BCR 1.75 -
Table 5.2: Per hectare cost and returns of potato production Medium potato farmers Items Unit Quantity Price per
unit (Tk) Total value (Tk)
% of the total cost
Gross Cost Hired labor Male Man-days 83 125.00 10375.00 6.15 Female Man-days 36 82.00 2952.00 1.75 Power tiller - - - 3330.37 1.97 Seed Home supplied
kg 756 22.80 17236.80 10.22
Seed Purchased kg 1079 22.80 24601.20 14.59 Urea kg 328 12.10 3968.80 2.35 TSP kg 305 55.85 17034.25 10.10 MP kg 320 53.00 16960.00 10.06 Gypsum kg 138 5.5 759.00 0.45 Manure Cow dung kg 3160 0.50 1580.00 0.94 Insecticides - - - 13500.00 8.00 Irrigation - - - 17500.00 10.38 Lease value - - - 27664.00 16.41 Others (ash, replacing bad seedling etc )
- - - 500.00 0.30
A. Total Variable Cost 157961.40
93.62
Fixed Cost Family labour Male Man-days 47 125.00 5875.00 3.48 Female Man-days 21 82.00 1722.00 1.02 IOP - - - 3059.23 1.81 B. Total Fixed Cost 10656.23
6.31
C. Total Cost (A+B)
168617.63 100
Gross Return - Main product kg 19302.99 15.60 301126.64 - D .Gross Return 301126.64 - E. Gross Margin(D-A)
143165.24 -
F.Net Return(D-C)
132509.01 -
G. Cost Tk/kg 8.73 - H. Profit Tk/kg 6.87 - I.BCR 1.79 -
Table 5.3: Per hectare cost and returns of potato production larger potato farmers Items Unit Quantity Price per unit
(Tk) Total value (Tk)
% of the total cost
Gross Cost Hired labor Male Man-days 111 128.00 14208.00 8.02 Female Man-days 97 85.00 8245.00 4.65 Power tiller - - - 3330.37 1.88 Seed Home supplied
kg 810 22.60 18306.00 10.33
Seed Purchased kg 1033 22.60 23345.80 13.17 Urea kg 343 12.00 4116.00 2.32 TSP kg 338 55.85 18877.30 10.65 MP kg 352 54.00 19008.00 10.73 Gypsum kg 142 7.0 994.00 0.56 Manure Cow dung kg 3840 .50 1920.00 1.08 Insecticides - - - 13500.00 7.62 Irrigation - - - 17500.00 9.88 Lease value - - - 27664.00 15.61 Others (ash, replacing bad seedling etc)
- - - 500.00 0.28
A. Total Variable Cost 171514.47 96.75 Fixed Cost Family labor Male Man-days 18 125.00 2250.00 1.27 Female Man-days - 85..00 - - IOP - - - 3430.29 1.98 B. Total Fixed Cost 5680.29 3.20 C. Total Cost (A+B)
177194.76 100
Gross Return Main product kg 19520.58 16.00 312329.28 - D. Gross Return 312329.28 - E. Gross Margin (D-A)
140814.81 -
F.Net Return(D-C)
135134.52 -
G. Cost Tk/kg 9.08 - H. Profit Tk/kg 6.92 - I. BCR 1.76 -
Table 5.4: Average per hectare gross returns, total cost, gross margins, net returns,
profits and BCR for small, medium and large potato farmers
Particulars Small farmers Medium farmers Large farmers All
categories farmers
Gross Returns (Tk)
288055.85 301126.64 312329.28 300503.92
Total Cost (Tk) 163932.64 168971.78 177194.76 169915.02
Total Variable
Cost (Tk)
150527.10 157961.40 171514.47 112600.99
Gross Margin
(Tk)
167528.73 143165.24 140814.81 140502.28
Net Returns(Tk) 124123.19 132509.01 135134.52 134256.77
Profit (Tk/kg) 6.54 6.87 6.92 6.78
BCR 1.75 1.79 1.76 1.77
Source: Field Survey, 2009
0
50000
100000
150000
200000
250000
300000
350000
Taka
GrossReturns
Total Cost TotalVariable
Cost
GrossMargin
Net Returns Profit BCR
Particulers
Figure: Average per hectare gross returns, total costs, total variables costs, gross margins, net returns and profit (Tk/kg) and BCR
Small farmersMedium farmersLarge farmers
Chapter VI
MARKETING SYSTEM OF POTATO
This chapter deals with existing marketing system of potato production in the
study area. Marketing of any product is essential to transfer it to the
consumers from widely scattered producing points. Marketing system of a
product means a process or system, which involves different marketing
components such as marketing channels, market intermediaries and their
marketing functions.
Marketing system may be thought of as the connecting link, the bridge
between producers and consumers. The marketing system sometimes
referred to as "the marketing machinery" or " the distribution system". A
marketing system includes all activities involved in the flow of goods from
the point of initial production to the consumer. It also plays two important
roles. The role of physical distribution, which is concerned with the
physical handing and transfer of products as they move from producers to
consumers, the role of adding value to farm commodities and facilitating
the exchange process between buyers and sellers ( Kohls and Uhl, 2005).
An efficient marketing system is essential for fair profit both for the potato
farmers and traders. Potato marketing system is composed of marketing
channels, market intermediaries and marketing functions. The components
of the potato marketing systems are analyzed in the succeeding pages.
6.1 Marketing Channels
Marketing channels are the alternative routes of product flows from
producers to consumers (Kohls and Uhl, 2005). It refers to the sequential
arrangement of various marketing intermediaries involved in the movement
of product from producers to ultimate consumers. Marketing channel plays
an important role in achieving the marketing objective of any organization.
In the study area, potato moved from the producer-sellers to consumers
through the channel i.e through some market intermediaries such as
Beparis, aratdars, Paikers, retailers and cold storage owners. It was
observed that potato needed to move a long distance from the point of
production to the consumers.
Figure 6.1: General channels of potato
Farmers
Beparis
Cold storage owners
Paikers
Aratders
Retailers
Consumers
Marketing channels through which the potato moved from potato farmers to
consumers which may be shown by drawing flow charts. Under this channel
potato is being marketed and distributed without storing in cold storage
(Figure 6.1):
Channel I: Potato Farmers --> Consumer
Channel II: Potato Farmers -> Retailer -> Consumer
Channel III: Potato Farmers -> Paiker -> Retailer -> Consumer
Channel IV: Potato Farmers -> Cold storage owner -> Paiker ->Retailer
-> Consumer
Channel V: Potato Farmers - Bepari ->Aratder - >Paiker ->Retailer
Consumer
Channel VI: Potato Farmers -> Bepari-> Paiker -> Retailer
->Consumer
Channel VII: Potato Farmers -> Bepari -> Retailer -> Consumer
Channel VIII: Potato Farmers -> Bepari -> Cold storage owner -> Paiker
-> Retailer -> Consumer
Channel IX: Farmer -> Bepari -> Cold storage owner -> Retailer
-> Consumer
Marketing channels of potato in the study area, the major marketing
intermediaries were the Bepari, cold storage owners, Aratder, Paikers and
retailers who performed marketing functions and took a portion of
marketing margin.
6.2 Characteristics of Market Participants
From figure 7.1 it is clear that along with the farmers, a number of'
intermediaries participated in the marketing of potato from the point of'
producers to the ultimate consumers. The intermediaries involved in potato
marketing in the study areas were Beparis, Aratdars, and Cold storage
owners. A brief description of market participants is given below.
6.2.1 Potato farmers
The potato farmers were the initial link in the potato marketing channel.
Producer-sellers were those farmers who performed the role of a seller in
selling of potato after harvesting. The producer-sellers and various
intermediaries formed the linkage in the channels. In the study areas the
producers sold their product to the intermediaries such as Beparis,
Aratdars, Paikers, retailers, Cold storage owners and consumers either in
market or at the farmyard.
6.2.2 Beparis
Beparis were relatively big and non-licensed traders in the study areas.
They handled relatively a large volume of potato than other traders. They
were independently organized. In the study areas, the Bepari purchased
potato from the farmers and sold it to cold storage owners, Aratdars,
Paikers and retailers.
6.2.3 Aratdars
Aratdars were basically the commission agents who normally had flixed
establishments in the market. They did the functions of negotiating
transaction between buyers and sellers in exchange of commission.the
potato farmer or trader generally give the potato to the aratdars for sale
either to retailers or big consumers. Aratars were big merchants and
licensed traders having fixed business premises and godowns. They had
some hired labourers or parts or full time salaried person for performing
various functions. Generally aratdars were self-financed as they did not
require large for operating the business. In general, Aratdars operation in a
large geographic area between the points of production and the points of
consumption.
6.2.4 Cold storage owners
Cold storage owners possessed cold storage plants for potato storage and
rendered storage facilities to the potato traders and farmers on receipts of
storage charges. They also bought potato from farmers and Beparis, stored
the same in their plants and sold to Paikers and to the retailers through
Aratdars on payment of commission.
6.2.5 Paikers
Paikers were independently organized and most of them were involved in
potato trading throughout the year. They were licensed traders having fixed
business premises in the wholesale markets. They bought potato from
farmers, Beparis, Aratdars and cold storage owners and sold it to the
retailers. They acted as the sales agents and stockholders for other potato
traders. They had storage facilities; sometimes they also acted as Aratdars.
6.2.6 Retailers
Retailers were the last link in the channel of potato marketing. They were
the specialized sellers who directly connected with the consumers. Retailers
were small of all types of traders. They did not have any permanent
establishment but had fixed place to sit on the market centre. They
purchased potato from Beparis, Paikers and cold storage owners and also
from. Farmers and finally sold their potato in small quantity to the ultimate
consumers.
6.3 Marketing Cost and Marketing Margin of Intermediaries
Marketing cost and marketing margin is useful for all those people (dealers,
retailers and farmers) who are involved in performing marketing functions.
It has a great significance because, by referring to the marketing cost and
margin one can whether or not the services of the intermediaries are
provided at reasonable rates (Sidhu, 1990).
In this chapter an attempt has been made to analyze marketing costs and
margins by using DAE wings survey data, 2009 on potato marketing system
in Jamalpur-Sherpur region.
Marketing cost represents the cost of performing various marketing
functions which are required to transfer a commodity from the place of
production to the ultimate consumers. The marketing cost includes costs of
all business activities necessary to ascertain the needs and wants of market,
plan product availability, effect transfer in the ownership of products,
provide for the physical distribution and facilitate the entire marketing
process.
Marketing margin at particular stages of product may be defined as the
difference between purchase and sale price of a commodity. According to
(Kohls and Uhls, 1980) marketing margin is defined as the difference
between what is paid by the consumers and what is received by the
producers. Marketing margin refers to the difference in value for equivalent
physical quantities of a given commodity between different stages of
marketing. Marketing margin of each intermediary was estimated by
deducting the purchase price of potato from its sale price while the net profit
was estimated by deducting marketing cost from the marketing margin.
.Although the marketing costs and margin of potato differed highly at
different levels, an average situation for farmer and each intermediary has
been discussed below.
6.3.1 Marketing costs of farmers
Major items of marketing cost of farmers of all groups were loading and
unloading, grading, market toll, transportation, storage, packaging, wastage
and personal personal expenses data on the marketing costs of potato
(Table6.1).
Farmer who sold potato at farm gate, they incurred very small amount of
marketing cost. Total marketing cost of farmers at Jamalpur-Sherpur region
was Tk/kg 0.20.The highest cost was due to storage and the second highest
cost was transportation of potato which was percent, percent respectively
(Table6.1).
Table 6.1: Marketing cost of farmer in Jamalpur-Sherpur region
Cost items Cost(Tk/quintal) %
Transportation 6.36 20.00
Storage 8.12 40.60
Wastage 3.10 15.50
Grading 0.05 0.25
Market toll 0.25 1.25
Loading and unloading
0.08 0.40
Packing 0.90 4.50
Personal expenses 1.14 5.7
Total 20.00 100
Cost of Tk/kg 0.20 -
Source: The Potato Sector of Bangladesh: Its Opportunities and Growth Hindrances, KATALYST and BAU, 2009. Note: Marketing information collected and related costs were estimated from field survey and FGD data, and guided discussion of field service Wing, DEA, 2009. 6.3.2 Marketing cost of intermediaries
Marketing cost of potato at intermediaries level included the expenses made
by different intermediaries for movement of the product through the
marketing channel. Different items of cost such as loading and unloading,
grading, packaging, market toll, commission, transportation, storage,
wastage, personal expenses and other costs (i.e., entertainment and tips,
weighing charge, electricity charge, stationary item like papers, pad, mobile
charges etc.) were included in the intermediaries involved in potato
marketing.
The marketing cost of the traders (bapari, paiker) and retailers were Tk./kg
1.90 and 0.20 respectively. All time, traders spent a good amount of money
for providing marketing services.
Table6.2: Marketing channel, marketing margin and marketing cost of
market participants in marketing of potato (without storing in cold storage),
Jamalpur-Sherpur
Intermediaries and market participants
Particulars of marketing. Marketing unit: Tk/kg Production cost
Purchase price
Sales price
Marketing margin
Marketing cost
Marketing profit
1 2 3 4 5=4-(2=3) 6 7=(5-6) Farmers 11.40 - 13.50 2.10 0.20 1.90(21) Traders - 13.50 21.90 8.40 1.90 6.50(72) Retailers - 21.90 22.70 0.80 0.20 0.60(7) All participants
- - - 11.30 2.30 9.00(100)
Source: The Potato Sector of Bangladesh: Its Opportunities and Growth Hindrances, KATALYST and BAU, 2009. Note: 1-4, Marketing information collected and related costs were estimated from
field survey and FGD data, and guided discussion of field service Wing, DEA,
2009. (Figures within parenthesis indicate the percentage of total profit).
6.3.3 Marketing margin and profitability of intermediaries
The marketing margin depends on market condition in time of buying and selling.
At each level of market, most of the intermediaries act as buyers and as well as
sellers. Marketing margin is the price for adding activities and functions
performed by intermediaries (Kohs and Uhl, 2005). Marketing margin at a
particular stage of transaction is the difference between sales price and purchase
price while marketing profit is the difference between the marketing margin and
marketing cost for potato marketed. Total marketing margin is the difference
between the price paid by consumer and the price received by the producer. The
marketing margins of potato for different intermediaries of Jamalpur-Sherpur
region were Tk/kg 8.40 and Tk/kg 0.80 for traders and retailers and the
corresponding values for marketing profits for farmers, traders and retailers were
Tk/kg1.90, Tk/kg 6.50 and Tk/kg 0.60 respectively (Table 6.2).
0
5
10
15
20
25
% o
f M
ark
ert
ing
pro
fit
Production cost Purchase price Sales price Marketingmargin
Marketing cost Marketing profit
Jamalpur-Sherpur
Figure6.2: Percentage of marketing profit of different market participants in Jamalpur-Sherpur regions
FarmersTradersRetailersAll participants
In the marketing system, all the intermediaries provide services and marketing
facilities and incur cost for them, but still marketing margin and profit for
different intermediaries of market were higher. The figure 6.2 shows that the
marketing margin and the marketing profit for trader were Tk. 8.40 and Tk. 6.50
per kg potato, respectively. The marketing margin for the retailers was Tk. 0.80
and that of marketing profit was Tk. 0.20. Marketing margin and marketing profit
for farmers were Tk. 2.30 and Tk. 1.90 respectively which shared marketing profit
only 21%. However, marketing margin and marketing profit for all participants
were Tk. 11.30 and Tk. 9.00 respectively.
6.4 Market Exchange and Buyers of Potato
In Jamapur-Sherpur zones, 70.00% of the farmers sold their potato in the local
assembly market followed by farm gate 26.67% and cold store 3.33% (Table 6.3).
Table 6.3: Distribution of potato farmers of Jamalpur-Sherpur Zones according to
their place of selling their potatoes
Place of sale Jamalpur-Sherpur
n=30 % Farm gate 8 26.67 Arots - - Local assembly market 21 70.00 Cold store 1 3.33
Source: The Potato Sector of Bangladesh: Its Opportunities and Growth Hindrances, KATALYST and BAU, 2009. Note: Figure in parentheses indicate to sample size (n)
In the study areas, 100% of selected respondents sold their potato to the traders.
The traders play an important role in marketing of potato from the farmers
followed by the cold store owners and others (Table 6.4).
Table 6.4: Distribution of potato farmers of Jamalpur-Sherpur zones according to
whom they mostly sold their potatoes
Buyers of potato Jamalpur-Sherpur n=30 %
Traders 30 100 Cold storage owner - - Others - -
Source: The Potato Sector of Bangladesh: Its Opportunities and Growth Hindrances, KATALYST and BAU, 2009. Note: Figure in parentheses indicate to sample size (n)
Chapter VII
FACTORS AFFECTING ECONOMIC RETURNS OF POTATO
PRODUCTION
This chapter is attempting to identify and measure the effects of the factors of
production on economic return of potato production in the framework of
production function analysis. For this purpose, Cobb-Douglas production function
(in value term) has been chosen to determine the effects of selected inputs on
potato production. Production of potato was assumed to be affected by seven cost
items and other factors.
Considering the importance of the inputs affecting potato production, a number
of inputs such as human labour, power tiller, seeds, fertilizer, irrigation and
insecticides were considered as explanatory variables. The individual effects of
these inputs on the dependent variable can be explained to a certain degree by
multiple regression analysis.
7.1 Explanation of the Variables Included in the Model
At first, let the null hypothesis H0= βjk the coefficient of interaction and variables
terms in translog production function are zero i.e. there is no relation of potato
production with the categories of farmers.
After testing the hypothesis, stochastic frontier production function is an adequate
representation of the data. The estimated values of the co-efficient and related
statistics of the stochastic of potato production are shown in Table 7.1. The
interpretations of the values and the major findings are presented below:
lny1= 3.505+0.096X1i+0.025X2i-0.047X3i+1.010 X4i-0.104 X5i-0.081 X6i-0143D
1i+0.015 D 2i
7.2 Interpretation of the Results
Seed and fertilizer
The regression coefficient of seed and fertilizer (Urea, TSP, MP, and Gypsum)
cost were 0.096 and 1.01 which were positive and significant at 1 percent level.
This implies that 1 percent increase in seed cost and fertilizer, keeping other
factors constant, would increase the gross return by 0.096 and 1.01 percent
respectively.
Power tiller and irrigation
The regression coefficient of power tiller cost and irrigation cost were -.047 and -
.081 which were negative and statistically significant at 1 percent level. This
implies that keeping other factors constant, 1 percent increase in additional power
tiller cost and irrigation cost would decrease the gross return of potato by 0.047
percent and 0.081 percent respectively (Table 7.1).
Insecticides
The regression coefficient of insecticides cost was -.104 which was negative and
statistically significant at 5 percent level. This implies that keeping other factors
constant, 1 percent increase in additional insecticides cost would decrease the
gross return of potato (Table 7.1).
Human labour
The regression coefficient of human labour cost was .025 which was positive and
statistically insignificant.
Dummy for small and medium categories farmers
The regression co-efficient of dummy for small potato farmers was -1.43, which
was significant at 1 percent level which indicates that the null hypothesis is
accepted that gross return has no relation with farmer categories of gross return
from potato production. The estimated coefficient of medium potato farmers was
.015 which was positive and statistically insignificant .It suggests that there were
no relation between gross return with categories farmers.
Adjusted R2
The co-efficient of multiple determinations, Adjusted R2 was 0.88 for potato
production, which indicated that about 88 percent of the variation in potato yields
was explained by the independent variables included in the model. The estimated
values of the co-coefficients and related statistics of the Cobb-Douglas production
of potato are shown in the Table 7.1.
Table 7.1 Estimated values of the coefficients and related statistics of the stochastic frontier production function of potato
Exploratory variables
Potato Values of coefficients t-value Significant (p
values) Intercepts 3.505 - .000 Seeds (X1) 0.096* 3.367 .001 Human labour (X2) .025 .740 .463 Power tiller (X3) -.047* -2.889 .006 Fertilizer(X4) 1.010* 30.543 .000 Insecticides (X5) -.104** -2.002 .051 Irrigation (X6) -.081* -4.073 .000 Dummy for small potato farmers (D1i )
-.143** -2.408 0.020
Dummy for medium potato farmers (D2i)
.015 .309 .759
Adjusted R2 0.86 - - F-value 680.942 - - Return to scale 0.771 - -
Sample size 60 - -
Source: Field survey, 2009
* Significant at 1 percent level
** Significant at 5 percent level
*** Significant at 10 percent level
F-value
The F value of the equation was highly significant at 1 percent probability level
implying that all the variation in potato yield depends mainly upon the
explanatory variables included in the model.
Return to scale
The sum of all the production function co-efficient of the equation for potato
production was 0.771. This indicated that the production function exhibited
decreasing return to scale for potato production. That means there is no need to
increase allocating more resources for higher potato production. One unit change
in investment will lead to 0.771 unit change in return.
.
Chapter VIII
PROBLEMS AND CONSTRAINTS OF POTATO
PRODUCTION
The purpose of this chapter is to identify and analyze the major problems
associated with potato production and marketing in the study area. The most
burning problems of growing potato that the farmers were usually facing are
summarized and briefly discussed in this chapter.
Table 8.1: Problems and constraints in potato production
Problems and constraints and constraints in growing potato
Categories of farmers Small farmers Medium
farmers Large
farmers No % No % No %
High Land use cost ( Lease value)
20 53 8 50 1 17
Quality seed, fertilizer and insecticides are highly expensive
25 66 9 56 3 19
Higher charge of cold storage 15 39 4 11 2 33 High labour wage rate 13 34.21 7 44 2 33 Uncertainty in input supply and risk in product sale
4 11 2 5 1 17
Lack of adequate transportation facilities
7 18 3 19 - -
Source: Field Survey, 2009 Note: The sum of percentage may not equal to 100 because some farmers mentioned more one problems. 8.1 Land Use Cost is High
The seasonal land use cost (lease value) is very high in the study areas .About 53
percent small farmers, 50 percent medium farmers and 17 percent large farmers
faced high land use cost respectively (Table 8.1).
8.2 Quality Seed, Fertilizer and Insecticides are Highly Expensive
Non-availability of improved modern quality seed and its high price were found to
be major limiting factor in producing potato in the study areas. 66 percent small,
56 percent medium and 19 percent large potato farmers reported this problem
(Table 8.1). Most of the farmers purchased HYV seed potatoes but they reported
that in most cases the seeds were of very inferior quality. Besides, the prices of
the seeds very high during the planting season.
Fertilizer and insecticide are vital inputs in the production of potato. Insecticides
of standard brands and quality are often not available in time and at reasonable
price. The supplies of the chemical during the potato growing season are generally
not regular and adequate, and the prices also often remain much higher than the
standard company rates. The TSP, Urea, MP and Gypsum fertilizers available in
the markets are often of extremely poor quality, and are reported to be adulterated.
There has been an extensive complain of the potato farmers against the quality of
fertilizers packaged by the local small industries. 66 percent small farmers, 56
percent medium and 19 percent farmers reported that although there was timely
supply of fertilizer yet the price was high (Table 8.1). This is a usual phenomenon
in Bangladesh and it is happening very frequently with the privatization of the
input supply for agricultural production.
8.3 Higher Charge of Cold Storage
Lack of proper adequate storage facilities was a serious problem. About 39
percent of small farmers, 11 percent of medium farmers and 33 percent of large
farmers complained about this problem (Table 8.1). Potato is a perishable product
and due to lack of adequate storage facilities, many farmers were compelled to
sell quite a considerable portion of their product at a lower price just after the
harvest time. The quality of the seed potato was even worse in the sense that most
of the farmers could not store it properly because of insufficient storage facility.
8.4 High Labour Wage Rate
Since potato is the very labour intensive crop, supply human labour should
balance the demand so that wage rate could remain within the acceptable limit.
Potato season is usually the busiest season in terms of crop production; labour
wage remains in the high side which compel farmers to limit lob our intensive
crop production. About 34 percent small, 44 percent medium and 33 percent
large potato farmers faced acute shortage of human labour in the production of
potato resulting in high wage rate and sub-optimal potato hectare (Table 8.1).
8.5 Uncertainty in Input Supply and Risk in Product Sale
Facilities for marketing of potatoes during the peak harvesting time are limited.
Often there is no completion among the buyers (Table 8.1).
8.6 Lack of Adequate Transportation Facilities
To have` fair price for commodity, transportation is one of the important
indicators which lacking in the study areas. About 18 percent of small potato
farmers and 19 percent medium potato farmers reported that due to lack of
transportation facilities they could not take their products to distant markets towns
and cities and so could not have the advantage of getting higher prices prevailing
in town and city markets (Table 8.1).
Chapter IX
SUMMARY, CONCLUCION AND RECOMMENDATION
This chapter highlights of the major finding and conclusions of the research. The
findings of the survey, observation of the potato farmers on various issues related
to the potato production as well as the livelihood of the households are presented
in this chapter. For the sake of a meaningful study, it contains the salient features
dealing with introduction, methodology, socioeconomic characteristics, costs and
returns of potato production, marketing system of potato and production and
marketing problems faced by the potato farmers and all other issues related to
potato production.
9.1 Summary
Agriculture, being the mainstay of Bangladesh Economy, contributes about is
20.87 percent (MoF, 2008) to GDP and provides employment to 68.5 percent
(BBS, 2005) of its national labour force. Thus its importance in the economy can
not be exaggerated. However, due to paucity of capital and modern technology,
agricultural productivity in this country is one of the lowest in the world, even
though the country is blessed with most fertile soils. Agriculture, sectors generates
about 30 percent of the total foreign exchange earnings, and moreover supplies a
huge amount of raw materials to the industry sector of this country. Corp as sub-
sectors is the most important in terms of GDP contribution; export earning,
employment opportunities and nation’s food security. However, nutritional needs
of the people demand that serious attention should be paid to the non rice food
crops as well as to attain food self sufficiency within a reasonable time frame. In
this context, potato is one of most important cash crops and it is one of the leading
crops of the world after rice and wheat.
Potato is a complementary vegetable to rice and when rice becomes scarce,
potatoes are eaten as temporary or partial substitution. In this context, potato may
be considered as one important vegetable crop which is most important from
nutritional point of view. The production of potato needs to be increased in order
to ensure the required sufficient quantities of vitamins, mineral, and protein in the
human diet of low income earning people. Since it combine in one crop, the
desirable characteristics of higher acceptability due to low cost and also higher
nutrition status and palatability, the people of Bangladesh can reduce pressure on
rice by taking potato as a rice substitute by changing their food habit. Moreover,
potato grows within a short time period and potato is generally labour intensive
crop and offers a considerable promise for generating increased rural employment
opportunities. But in fact, today potato has attained the status of only a very minor
crop in Bangladesh. One of the importance problems of potato production is its
non-acceptance as a popular food item.
Potato is also the main crop and is widely cultivated in Jamalpur-Sherpur regions
of Bangladesh along with rice production. The potato is used as supplementary
crop with rice and relatively it has high calorie content. The potato has a wider use
as different forms as vegetables not only in Bangladesh but also in other countries
of the world. Realizing these situations, the Government of Bangladesh has been
pursuing a crop diversification strategy to reduce the dependency on rice and to
increase the consumption of potato. Potato is considered as an important vegetable
and cash crop and has high nutritive value.
The present study attempts at looking the analyzing the profitability and the
effects of inputs on potato production at different categories of potato farmers in
context of rural Bangladesh. The focus of the present research was to satisfy the
following objectives.
1. To document the socio-economic characteristics of potato farmers;
2. To determine the cost, returns and relative profitability of potato different
categories of potato farmers;
3. To determine the marketing profit of potato farmers under the present
marketing system;
4. To assess the factors influencing economic returns of potato production;
5. To identify major problems faced by the potato farmers.
Keeping those objectives in view, a farm survey was conducted in two villages in
Bakshiganj Upazila of Jamalpur district and Sherpur sadar Upazila of Sherpur
district were selected.Then two villages namely Noymia under of Bakshiganj
Upazila and Kusumhati under Sherpur sadar Upazila which are the most
neighboring villages. In total, 60 samples were taken of which 38 were small
farmer, 16 were medium and 6 were large farmers. Data were collected by direct
interview. The collected data were then sorted and scrutinized to meet the
objectives of the study. Finally costs, returns, and functional analysis were done
by using different statistical techniques to fulfill the objectives of the study.
In this study, an attempt has been made to identify the socioeconomic
characteristics of the sample farmers. Considering the age of the potato farmers, it
appeared that majority of the farmers belonged to the age group of 25-45 years of
age. Out of 73 percent of the potato farmers were educated where the majority
29%, 50% and 17% had secondary level of education for small, medium and large
farmers potato farmers. Only 7% had higher secondary level of education.
Primary level of education had 17%. Average family size was 7 of potato farmers.
Working members of the family were 59%, 85% and 66% for small, medium and
large potato farmers respectively. Educational level of the potato farmers family
members were primary 24%, secondary 22%, S.S.C 17%, H.S.C % and above
H.S.C only 6% on an average. According to land holding, categories of farmers
farm size were 0.766, 2.275 and 4.142 hectares for small, medium and large
farmers respectively. The benefit cost ratios (BCR) above the total cost were 1.75,
1.79 and 1.76 for small, medium and 1.77 for all categories potato farmers
respectively.
The farmers used different inputs for producing potato production. Some of these
inputs were purchased and some of them were home supplied.
The yield of potato were 18,988.52 kg/ha, 19,302.99 kg/ha and 19,520.585 kg/ha
for small, medium and large farmers respectively as well as the corresponding
gross returns were Tk.2,88,055.85/ha, Tk.3,01,126.64/ha and Tk.312329.28/ha.
Cost of production of potato were found to be Tk. 1,63,932.64/ha, Tk.1,68,617.63
/ha and Tk.1,77,194.76/ha. Net return of potato per hectare amounted to
Tk.1,24,123.19/ha, Tk.1,32,509.01/ha and Tk.1,35,134.52/ha for small, medium
and large potato farmers respectively.
Farmers in the study area used purchased as well as home supplied inputs. In
calculating family supplied inputs, the principle of opportunity cost was followed.
Tabular technique of analysis was used to measure the profitability of potato.
Potato was found to be profitable in terms of total cost. About eighty percent
potato farmers reported that their income increased due to potato production. In
terms of overall socioeconomic improvement 60 percent of the potato farmers
opined that potato production greatly helped to improve their socioeconomic
condition.
The present study identified, marketing margin and marketing profit under
existing marketing system such as marketing channels, market intermediaries,
various function of them. In potato marketing, the marketing costs and margins
were relatively high. The net share of the farmers was found to vary widely. The
farmers share in the marketing profit was 21%.
The results of empirical analysis reveal that factors affecting potato production
has significantly positive impact of two variables among six explanatory variable
namely seed and fertilizer. Medium farm size has significantly impact on potato
production.
With regard to the major problems faced by the farmers, the findings revealed that
low output price, quality seeds, marketing facilities, high price of fertilizers, and
other important inputs, infestation of insects and disease, inadequate facilities of
cold storage, etc. were the major obstacle which stand in the way of potato
production in the study area. As measures to overcome these problems it was
suggested that supply of fertilizers and good quality of seeds at reduced prices as
well as availability of pesticides were more important measures, which could
encourage farmers to expand potato production. The farmers in the study area also
mentioned some relative advantages growing potato which included relatively
higher profit produced with low irrigation cost, early harvest and go for other
crops, less disease infestation, use of less fertile land etc.
9.2 Conclusion Potato is important and leading staple and cash crop of Bangladesh. Farmers
earned higher profit from potato production. If modern inputs and production
technology can be made available to farmers in time, yield and production of
potato may be increased which can help the farmers increase income and improve
livelihood conditions. Potato can help in improving the nutritional status of the
rural people. Therefore it may be, concluded that where there is lack of irrigation
facilities, farmers can profitably produce potato instead of its others competitive
crops. Further, in the areas where land remains fallow in the winter season,
production of potato can be undertaken to increase income and employment
opportunities of the farmers. The domestic consumption of potato as human food
is likely to increase in future. The present and future potential market and demand
for potato should be determined through a comprehensive study in order to take
up a well-planned potato production programme at national level. This study,
therefore, confirms that the potential for increasing production through improved
performance with available resources and traditional technology is limited. Given
the weak institutional support services such as extension, education and the
finding of considerable inefficiency in improved potato. Potato production is as
expected and thus an efficient use of improved techniques of production coupled
with better management of land through increased institutional and infrastructural
support will help enhance potato production.
9.3 Recommendations
Based on the findings of the study, some recommendations may be advanced
which are presented below:
i. For increasing the production of potato, regular and adequate supply of seed,
fertilizers and insecticides should be ensured to the farmers on time at fair price.
ii. Policy makers and extension workers should take all possible steps to
encourage farmers to introduce potato production where is feasible.
iii. Reasonable market prices of potato should be ensured by increasing available
storage facilities and establishing various types of food processing industries.
iv. The evil practice of middlemen in the marketing of potato should be
minimized thought arrangement of direct sale of potato by the seed producers and
involving their genuine dealers.
v. Positive steps should be taken for improving transport and marketing facilities
in the study area
vi. Government should provide all possible help to supply required inputs and
others necessary support to the farmer to produce more potato rather than cereal
crops.
9.4 Limitations of the Study and Scope for Further Research
One of the major limitations of the present study is that for data collection, the
researcher had to rely upon the memory of the potato farmers since majorities of
the farmers did not keep any written records; they had to furnish information
mainly from their memory.
The study was conducted on a small size of samples and with one geographic area
due to time and fund constraints. If the study was conducted on a large sample
covering broad area, the result might be more reliable and accurate. In the present
study some specific variables considered, but the further research might be
conducted on some other important variables influencing potato production.
Since the present study was not a comprehensive study, it is very difficult to
arrive at any specific generalization. Thus the present study might be helpful for
the researcher, policy makers and to other concerned authorities for conducting
further comprehensive research or to arrive at any plan for the development of the
potato farmers.
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