Browsing by Author "Mbua, Ally Ismail"

Now showing 1 - 1 of 1

Supply response analysis of the sugarcane outgrowers in Tanzania
(Sokoine University of Agriculture, 2020) Mbua, Ally Ismail
There are many arguments that increasing food self-sufficiency in sub-Saharan Africa (SSA) could reduce the high food price escalations which are often related to the increasing demand and importation of food commodities. In Tanzania, sugar is one of the agricultural commodities being imported to meet the country’s high sugar demand for domestic and industrial use. Currently, the overall annual sugar demand in Tanzania is about 600 000 metric tons against the country’s annual sugar production of about 350 000 metric tons. The study attempts to examine the supply response of the sugarcane outgrowers to price and non-price factors using the Error Correction Model (VECM) l to analyse time series data covering the period 1996 to 2018. The findings indicate that the short-run own price elasticity for sugarcane was 0.954 while the long-run elasticity was 4.525343, cross price elasticity was -0.654929 in the short-run while the long-run elasticity was -3.8184. For non-price factors area harvested, amount of cane produced were significant in the short-run with estimated elasticities of -0.41956 and 0.5063 respectively. In the long run all non-price factors were significant with estimated elasticities of 0.1915, 3.4759 and 0.0137 for sugarcane production, rainfall and trend factors, respectively. These results imply that, sugarcane producers are more responsive to price factors than non-price factors. The fact that all the variables were significant in the long-run implies that farmers need time to adjust their production in response to changes in the mentioned factors. The very small estimate for the trend factor implies that there has been a very small adoption of productivity enhancing technologies during the 1996- 2018 period. To achieve her self-sufficient endeavour, the Tanzania Government should invest in rural infrastructure and appropriate technological improvements as long-term strategies to improve sugarcane supply, encourage policies geared towards making sugarcane a more attractive enterprise and design strategies to improve the use of yieldenhancing inputs like fertilizers.