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Determinants of Sugarcane Profitability: The Case of Smallholder Cane Growers in Swaziland

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Author(s): M.B. Masuku

Journal: Asian Journal of Agricultural Sciences
ISSN 2041-3882

Volume: 3;
Issue: 3;
Start page: 210;
Date: 2011;
Original page

Keywords: Cane growers | profitability | smallholder farmers | sugarcane | sugar industry

ABSTRACT
The sugar industry is the backbone of Swaziland's economy, with annual revenue exceeding E1440 million (US$ 160 million). As part of the agricultural as well as the manufacturing sector, industry, it a accounts for 18% of the country’s GDP. Therefore, the economy of Swaziland is to a great extent based on the sugar industry. This study presents empirical findings on the determinants of the profitability of sugarcane growers in the Swaziland sugar supply chain. The study is based on data collected in 2001 from 124 smallholder cane growers who supply sugarcane to the three sugar mills in Swaziland (Simunye, Ubombo (Bigbend) and Mhlume). The study used purposive sampling, which is most desirable when certain important segments of the target population are intentionally represented in the sample. The results of the study revealed that the performance of these farmers is affected by farming experience, change in sucrose quota, yield per ha, sucrose content and the distance from the farm to the mill. The implications of this study suggests, that smallholder farmers need to be trained and motivated in order to be commercially oriented. The Swaziland Government should play a role in providing smallholder cane growers with some training in business management skills and in addressing issues of concern to farmers as they develop in order to improve their yields. This should be done through the government extension agents, provided specifically to assist smallholder sugarcane farmers, and the various government departments involved in providing training in business and management skills. There is also a need to limit the production of sugarcane to areas, which are closer to the mills in order to reduce transaction costs.
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