An economic analysts of state owned large scale mechanised wheat farms. a case study of setchet wheat farm in Arusha, Tanzania.

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Sokoine University of Agriculture


This large study scale Arusha, describes wheat Tanzania. and analyses production The the Setchet at economics of Farm in Wheat of study are to objectives (a) determine benefits and costs of wheat production at Setchet Farm and examine the farm’s cost effectiveness, (b) examine efficiency and profitability of the farm and (c) investigate the constraining factor(s) limiting the farm to achieve its potential yields. The study requires extensive use of secondary data. However primary data were collected to supplement recorded data. Analysis applied involved use of descriptive analyses, such as the benefit-cost ratio (supplemented by net present value and internal rate of return), efficiency ratios and cost comparative analysis. Survey results reveal that, the farm is operating below its potential compared to wheat research trials done at Hanang Wheat complex. Efficiency ratio analysis shows that although the farm has been able to meet its production costs, meagre farm margins in some years have made the farm not able to meet its investment and depreciation costs. Economic analysis demonstrates that the current average farm performance is economical, while financial tests reveal that the farm is commercially unviable at 1.8 tons/ha. The economic analysis gives a benefit-cost ratio of 1.15. financial analysis at the same management level, But gives a benefit-cost ratio of 0.96. the On other cost hand, comparative test reveals that conventional, tillage method is cheaper than reduced tillage method currently applied at the farm. From the study it is recommended that, the farm should do advance preparati on of f arm machinery before field operations, while seed multiplication has to be carried on separate blocks. On the other hand, the farm should apply conventional tillage method during land preparation. Finally the study recommends further restructuring of NAFCO so as to allow autonomy and flexibility of the farm management.


MSc. Dissertation in Agricultural Economics


wheat production, Large scale economics, Wheat Farm