Factors affecting the decision-making of farmers and traders on corn storage in Moc Chau District, Son La Province, Vietnam

This study examined the nature and extent of corn storage by farmers and traders. The profitability of storing corn was determined and the effects of physical and socio-economic factors on the farmer's and trader's decision on storing corn were evaluated. Data covering 2006-2007 crop seasons were gathered through personal interview of 99 corn farmers and 40 corn traders. The partial budget analysis was used to determine the additional profits from storing corn while the logit models were utilized in evaluating the effects of different factors on the farmer's and trader's decision on corn storage. The results showed that 53.5% of the corn farmer decided to store all or partly sell and partly store their produce while 57.5% of the corn traders did the same. The corn farmers adopted the traditional practice of storing corn while traditional and modern practices were employed by the traders. All the farmers and traders did not have to pay for corn storage fees except depreciation because they all own the land wherein they have built storage houses. The monthly volume of corn handled by the farmers and traders varied per season of harvest and majority of the farmers and traders stored their corn for two months. Marketing margins gained by the farmers and traders were higher during the winter season. Storage costs different between the farmer and trader groups and they depended on volume of corn stored. The partial budget analysis was used to determine the profitability of storing corn. The average additional profit was 4,705 thousand VND and 26,284 thousand VND for the farmers traders respectively. On per ton basis, the farmers obtained an average additional profit of 279.5 thousand VND while the traders earned 153 thousand VND. The factors found to be significantly affecting the farmer's decision on corn storage were price of corn after storage, volume of corn harvested, costs of corn storage, total annual household income, number of years with experience in farming, crop season and extension. Also, the factors affecting trader's decision on storing corn included quantity procured, storage levels, price of corn after storage, storage costs, annual income of the trader, gender of the trader, situation of borrowing and type of the trader.