Cost Benefit Analysis
Cost Benefit Analysis is essential for farm budgeting and planning enabling farmers to effectively compare and determine the profitability of various commodities; thereby creating an opportunity to identify and venture into farming as an enterprise based on current data. Cost Benefit Analysis (CBA) is a tool for determining agricultural enterprises profitability by assessing the gross revenues from an enterprise less the variable costs incurred. This information has enabled Commercial Villages understand how to determine their crops and products mix depending on profitability, input costs, land availability and labour intensity as some of the major cost drivers
Kenya
Cost Benefit Analysis: Kenya
According to a Cost Benefit Analysis conducted by Farm Concern International in Coastal Kenya, tomato is the most profitable crop with gross margin estimated at Kshs 149,250, Kshs 82,550 for cassava, Kshs 70,250 for pineapples, Kshs 24,770 for maize, Kshs 13,080 and Kshs 16,170 for green grams and cowpeas respectively while gross margin for chilli was Kshs 111,900 per acre per season. Maize farming among small holder farmers in Kenya is labour intensive and the main cost drivers include weeding, harvesting and fertilizer estimated at 17%, 13%, and 16% respectively while post-harvest loses are estimated at 5%. Maize has the lowest gross margin per acre compared to onions and cassava. Although onion is the most profitable crop, it requires high initial investment which might be a challenge for most resource constrained farmers. In one year, maize and onions can attain at least two production cycles compared to cassava which can only be harvested once in a year...Read More
Tanzania
Cost Benefit Analysis: Tanzania
A multi-value chain Cost Benefit Analysis conducted by Farm Concern International, FCI in Tanzania revealed that maize production among small holder farmers is labour intensive and the yield level is estimated to be about 1800Kgs/Acre. Labour costs are estimated to be 83% of the total production costs. The main cost drivers include weeding, fertilizer as well as shelling and harvesting as indicated in the figure below. The gross margin per acre is estimated at USD 240.5. Although bulb onion has the largest gross margin per acre, more investment is required in comparison to beans and maize.....Read More
Rwanda
Cost Benefit Analysis: Rwanda
A Multi-Value Chain Cost Benefit Analysis conducted by Farm Concern International in Rwanda under the Value Chains, Enterprises Development, Market Access and Commercialization (VEMAC) Programme funded by World Vision Rwanda revealed that cassava production is labour intensive with labour costs accounting for 54% of the total cost of production. Investment of labour saving technology would therefore influence profitability positively. From an Are of land, a farmer can earn an estimated net income of USD 58.8 (USD 5876 per hectare) at yield level of 400Kgs/Are representing a cost benefit ratio of 5.13. Comparing cassava, Irish potatoes, passion and maize, cassava is the most profitable crop while maize and Irish potatoes are the least profitable...Read More
Malawi
Cost Benefit Analysis: Malawi
According to a multi-value chain Cost Benefit Analysis conducted by Farm Concern International under the Transforming Household Resilience in Vulnerable Environments (THRIVE) project funded by World Vision Malawi, groundnut production among small scale farmers is highly labour intensive with labour costs accounting for 85% of the total cost of production. The main cost drivers include weeding land preparation and harvesting with yield level estimated at 800kgs/acre while the average farm gate price is estimated at USD 0.5 per Kg. As such, investment in ground nuts production has a cost benefit ratio of 4.11. Comparing soya, maize and green gram production, maize farming require the highest investment estimated at USD 390 per acre although groundnut has the highest gross margin per acre; USD 292...Read More
FCI VISION :Commercialized smallholder communities with increased incomes for improved, stabilized & sustainable livelihoods in Africa and beyond.