Comparing the economic efficiencies of rice and maize production in Amuru and Nwoya districts, Northern Uganda

Abstract

Maize and rice are important sources of both food and income in Uganda. As such, the government of Uganda has promoted these crops through research and extension programs. However, there are glaring yield gaps between farmers’ fields and research stations. In order to close the yield gaps, emphasis is being put on enhancing productivity through efficient use of resources for production as area expansion is unattainable. A random sample of 156 rice and maize farmers from which data were collected in Amuru and Nwoya districts was used in the study. Analysis was conducted using STATA software to determine the drivers of economic efficiency. Stochastic frontier and one stage procedure for estimating inefficiency models were employed. Results revealed that the mean economic efficiencies were 66.56% and 67.91%, for maize and rice, respectively. Further, it was established that seed cost, labor cost, and land rental cost (p<0.01) positively influenced production cost of rice and maize. Similarly, inefficiency model results disclosed that economic efficiency was significantly influenced by education level (p<0.01), age (p<0.01), distance to main road (p<0.01) and distance to market (p<0.01). In light of our results, we attest that farmers have opportunities to increase output by 16% and reduce cost by 21% and 20% for maize and rice respectively. We recommend that policies to enhance basic education for farmers under informal arrangements such as farmer training centers be instituted, incentivize youth to engage in agriculture, ease access to main roads and markets should be implemented so as to promote economic efficiency of producers.