TRADEOFFS AND ECONOMIC IMPACTS OF REPLACING TOBACCO WITH ALTERNATIVE CROPS IN SMALLHOLDER CROPPING SYSTEMS IN HOIMA DISTRICT - UGANDA
Description
Data used was collected from 384 households randomly sampled from four Sub Counties of Hoima District in 2017. The dataset is comprised of the sociodemographic data in addition to production data such as prices, yield and costs for selected crops (Tobacco, Maize, Cassava, Rice, and Beans). Using the Minimum Data-Tradeoff Analysis (MD-TOA) model, the data is used to assess trade-offs and impacts of replacing tobacco with alternative candidate crops. Taking the experimentation approach, redistribution of land area under Tobacco to a priority crop in the alternative cropping system (2) with other activities kept constant is simulated at a time to estimate the rate of adoption based on economic feasibility of the two systems - baseline and alternative system. The population of farms are sub divided into two strata, that is Small and Large farms for stratum 1 and stratum 2, respectively. Accordingly, the distribution of expected returns among farms for each system in each stratum are assumed to be normally distributed in the TOA-MD model. Normality facilitates implementation of the model, where the proportion of farms for which adoption is economically feasible is simulated in each stratum. Results showed highest potential adoption rates for Cassava implying that the crop presented as the best economically feasible alternative to Tobacco followed by Maize, Rice and Beans within smallholder cropping systems. The switch to Cassava is substantially, more efficient on large farms; and its predicted to have highest returns with the highest proportion of switching farms above the poverty line for both small and large farms. Overall, economic returns earned from the tobacco cropping system are lower compared to any of the four alternative systems. This implies that farmers are better off cultivating alternative crops especially with better access to stable markets that offer attractive prices; and scaled-up farm operations to larger proportions of land while taking advantage of production scale economies.