Assessment of the utilization, management and operating costs of agricultural tractors in the chemelil sugar belt in Kenya.
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Date
1992
Authors
Journal Title
Journal ISSN
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Publisher
Sokoine University of Agriculture
Abstract
The research undertook to study the utilization, management and operating costs of agricultural tractors used in the Chemelil sugar belt in Western Kenya. Historical cost data spread over a span of 16 years were obtained for 141 tractors operated by three different owners in the belt. The data was used to assess the level of utilization and operating costs and to test mathematical models for predicting tractor resale values, repair and maintenance costs, annual operating costs as well as establishing the factors that influence them. It was found that tillage tractors in the belt had an average annual use of 1040 hours and transport tractors 1230 hours and that both category of tractors had restricted utilization due to limits imposed by maximum hectarage for tillage tractors and queuing discipline at the sugar factory and in the fields for cane transport tractors. Mathematical models were formulated and tested for relation between ratio of tractor resale value to its current purchase price and depreciation age, relation between cumulative repair and maintenance costs expressed as a percent of initial purchase price and tractor age, cumulative depreciation against tractor age and the ratio of tractor resale value to its annual operating cost against tractor age. Multiple regression facility in the MSTATC version 1.41 computer software package was used to test the models. Important empirical relations were derived from the results of the tests. Qualitative factors were shown to influence the investigated quantities quantitatively and that the control of the qualitative factors could reduce operating costs. A relation for predicting annual operating costs of a tractor basing on its replacement value was found. The relation could also be used to predict the tractor’s optimal replacement point given the future purchase prices of similar or substitutive models. The trend of actual depreciation was found to defy the basic assumptions of accounting depreciation models. It was demonstrated that due to high inflation rates it is not possible to assign terminal salvage values to tractors in good running order, their age notwithstanding.
Description
Dissertation
Keywords
Agricultural tractor, Operating costs, Utilization, Chemelil sugar, Kenya