Economic analysis of production and marketing of kaipad paddy in kannur district

Abstract

The present study entitled “Economic analysis of production and marketing of Kaipad paddy in Kannur district” was conducted with the objectives of working out the costs and returns of Kaipad paddy cultivation, estimating the magnitude and the factors contributing to the yield gap, identifying the marketing channels and the price spread in different channels, finding out the constraints in production and marketing of Kaipad paddy and documenting the cultural practices of Kaipad paddy cultivation. The study was based on both primary and secondary data. The study was conducted in Kaipad tracts of Kannur district and primary data were collected by means of formal interviews from farmers, traders and market-intermediaries. The farmers in the study area were categorised into five groups on the basis of farming practices followed as farmers growing traditional variety, farmers growing traditional Kaipad and shrimp in sequence, farmers growing HYV (Ezhome-l/Ezhome-2), farmers growing HYV (Ezhome-1 / Ezhome-2) and shrimp in sequence and paddy farmers from non-saline areas adjacent to Kaipad. From each of the five categories, l5 farmers were selected from each of the Panchayat. A sample of 30 farmers was randomly selected from each group, thus making a total sample size of 150 farmers. Cost-return structure was worked out both for Kaipad and conventional paddy production using percentage analysis and cost concepts. The cost of cultivation (Cost C2- Rs.67128) was highest in the case of farmers growing HYV without shrimp in sequence. The cost of production of HYV was higher than the costs incurred for growing traditional varieties and the average income from the HYV was more than the income from traditional varieties. The highest average gross income of Rs.61741/ha was obtained by farmers growing HYV and shrimp in sequence while it was lowest for the farmer respondents growing traditional variety without shrimp in sequence. Family labour income was estimated to be negative in the category of farmers growing traditional variety. The net income and Benefit Cost Ratio indicated that the farming is a loss making business in Kaipad region, especially when the value of the family labour, the land value and the managerial cost were accounted in the cost. Yield gap was estimated and factors contributing to the yield gap were analysed using regression analysis. Among the farmers growing Ezhome-1without shrimp in sequence, the total yield gap was 747 Kg, which was 21 per cent of the potential yield whereas for farmers growing Ezhome-2 without shrimp in sequence, the total yield gap added to 847 Kg and it accounted for about 26 per cent of the potential yield. When Ezhome-1 and Ezhome-2 were grown with shrimp in sequence, the total yield gap was 601 and 497 respectively. The share of yield gap II in the total yield gap was found to be 38 per cent and 43 per cent respectively for Ezhome-1 and Ezhome-2 with shrimp in sequence, while it was 78 and 91 per cent for Ezhome 1 and Ezhome 2 without shrimp in sequence. In farms growing traditional varieties age was influencing yield gap positively while labour use in man days was found to be negatively influencing the yield gap. In the case of farms growing HYV, seed rate and education were significantly reducing yield gap. For the fitted log-linear yield function for all farms, age was found to be positively influencing yield gap while the seed rate and education were negatively influencing yield gap. The four marketing channels identified were, (i) farmer – rice miller – retailers -consumer (ii) farmer - local agent - rice miller- retailer - consumer (iii) farmer - local agent - Padasekhara-samithis - consumer (iv) farmer - consumer. The price spread was estimated as Rs.16.3 in channel I, Rs.17.51 in channel II, Rs.2.97 in channel III and Rs.3.85 in channel IV respectively. The marketing efficiency was found to be highest in channel III. Various constraints in production and marketing of paddy were identified and ranked using Garret’s ranking technique. Among the various constraints faced by farmers, high wage cost and scarcity of hired labour were the major ones. Low price realized for the produce was the foremost constraint faced in marketing of paddy. Since labour cost accounted for the major share in cost of cultivation and labour scarcity was the major constraint, efforts have to be made for mechanisation in Kaipad cultivation. The production must be increased by bridging the yield gap and thereby increasing the marketable surplus. Taking advantage of the GI status of Kaipad paddy, efforts are to be made for marketing it as a premium priced branded organic produce.