Examining the Profitability, Financial Efficiency and Constraints among Cotton Farmers in Ghana | Chapter 3 | Current Perspective to Economics and Management Vol. 1
This study assessed
the profitability, financial efficiency, and constraints among smallholder
cotton farmers, using data from a farm household survey in Northern Ghana.
Measures such as Asset Turnover Ratio, Operating Expense Ratio, Depreciation
Expense Ratio, and Net Farm Income Ratio were computed from the dataset, and
used to examine the financial efficiency levels of smallholder cotton farmers
in the area. Moreover, constraints faced by these farmers were also identified
and examined. The results revealed mixed findings regarding the financial
efficiency levels of these farmers. Comparing financial efficiency ratios to
the benchmark figures, Asset Turnover Ratio (20.28%), Operating Expense Ratio
(74.1%) and Net Farm Income Ratio (19.14%) suggest that smallholder cotton
farmers in Ghana are financially inefficient, but efficient regarding
Depreciation Expense Ratio (3.29%). Constraints such as incidence of pest and
diseases, poor pricing of seed cotton, untimely input supply by cotton
companies, difficulty in acquiring labour, bad weather conditions, and lack of
access to land, cash credit, and tractor services were identified as facing the
cotton farmers in Ghana. Intensified collaborative efforts by the government,
NGOs in the cotton sector, private cotton companies, and other cotton
stakeholders in building farmers’ technical and financial capacities, providing
input subsidies, and in setting fair cotton prices could ameliorate the
constraints, while enabling them to handle the cotton production business
efficiently.
Author(s) Details
Awal Abdul-Rahaman
Department of Agribusiness Management and Finance, Faculty of Agribusiness and Communication Sciences, University for Development Studies, P.O.Box, TL 1882, Tamale, Ghana.
Department of Agribusiness Management and Finance, Faculty of Agribusiness and Communication Sciences, University for Development Studies, P.O.Box, TL 1882, Tamale, Ghana.
Comments
Post a Comment