The influence of improved coffee varieties on productivity and profitability among smallholder coffee farmers in Tanzania: the case of Mbinga and Mbozi districts.

PhD-Thesis

The current world coffee demand is estimated to exceed production due to an increase in global coffee consumption aligned with number of dynamics on social, economic and environmental aspects to meet sustainable globe markets requirements. These dynamics such as imbalances in income distribution among market players, climate change and urbanizations due to population growth in coffee growing areas and shifting of consumers' taste and preference where producers need to be more innovative to increase productivity and quality can threaten the livelihood of millions of smallholder producers. Thus the strategies to ensure farmers increase coffee productivity and maximize profit are through producing coffee under sustainable manner. Tanzania Coffee Research Institute (TaCRI) initiated a hybridization programme to breed new varieties combine high-yielding and good beverage quality with resistance to coffee leaf rust (CLR) and coffee berry disease (CBD) for Arabica and coffee wilt disease (CWD) for Robusta. The average productivity of improved coffee varieties under good agricultural management practices is 2000 kg/ha higher than 1000 kg/ha from traditional varieties. The adoption of improved coffee varieties will contribute to minimise the use of fungicides to control coffee pest and diseases and contribute to increase productivity of high quality coffee produced under sustainable manner. The specific objectives of this study include the assessment of factors influencing the adoption of improved coffee varieties among smallholder farmers;, the assessment of the coffee yield gap among adopters and non-adopters of improved coffee varieties; and analysis of the profitability of coffee production among adopters and non adopters of improved coffee varieties in Mbinga and Mbozi Districts. This study was conducted in six wards covering ten villages in Mbinga and Mbozi districts in Ruvuma and Mbeya Regions respectively. The adoption in this study is defined as the use of improved coffee varieties developed and disseminated to farmers by the Tanzania Coffee Research Institute (TaCRI). Adopters of improved coffee varieties refer to farmers who planted a minimum of 300 improved coffee varieties and non-adopters mean farmers growing the traditional coffee varieties. The study used primary and secondary data. Primary data was collected from a sample of 122 adapters and 198 non-adopters of improved coffee varieties making a total of 320 farmers using a household survey semi-structured questionnaire. The survey was complemented by Focus Group Discussions (FGDs) at the ward level and observation. Secondary data were captured from different sources such as TaCRI, Tanzania Coffee Board (TCB) reports. Descriptive statistics were used to capture the rate of the adoption of improved coffee varieties. The five-point Likert scale was used to assess smallholder farmers' perception of improved coffee varieties. The logit regression model was used to assess factors influencing the adoption of improved coffee varieties. The descriptive statistics and Soil Analysis for Fertility Evaluation and Recommendation on Nutrient Application to Coffee (SAFERNAC) model were used to analyse the coffee yield gap and the logit regression model was used to determine factors influencing coffee yield. The Gross Margin (GM), the Benefit-Cost Ratio (BCR), the Break-even analysis for yield and price and the sensitivity of gross margin were used to examine the economic profitability of coffee production among adopters and non-adopters of the improved coffee varieties. The findings from descriptive statistics show that the rate of adoption of improved coffee variety is 38 %. Findings from the Likert scale revealed that smallholder coffee farmers' have a positive attitude toward adopting improved coffee varieties as they consider them to have high yields, good beverage quality, and disease resistance. The findings from the logistic regression model showed that contact with extension officers, membership in primary cooperative society and access to improved coffee varieties positively and statistically significance influence farmers' adoption decision of improved coffee varieties(p<0.05). However, factors such as access to market information, access information about the attributes of improved coffee varieties and total land size owned (ha) had a negative and statistically significance influence on the adoption of improved coffee varieties (p<0.05). From these findings generally, it can be concluded that both adopters and non-adopters of improved coffee varieties have a positive perception of improved coffee varieties. However, the lack of enough information about improved coffee varieties and access to improved coffee seedlings hinders the adoption of these varieties and creates room for farmers to plant coffee seedlings with unknown sources of plant materials. Therefore, this study recommends that the coffee industry should strengthen extension services to disseminate appropriate information to farmers. The government should provide support and encourage different players in coffee seedling multiplications and distributions to farmers to meet the demand. Meanwhile, TaCRI should develop a seed certification system to avoid and minimize the risk of farmers collecting seeds and seedlings from unknown coffee varieties that are not recommended. These recommendations will contribute to an increase in the rate of adoption of improved coffee varieties hence increasing productivity and profitability. The findings revealed that the average fertilizer application for both adopters and non- adopter was below the recommended rate. Fungicide application to control Coffee Berry Diseases (CBD) and Coffee Leaf Rust (CLR) was below the recommended rates. The findings showed that the average yield attained by adopters is 1250 kg/ha and non- adopters is 512 kg/ha. The descriptive analysis showed that the yield gap for adopters is 750 kg/ha equivalent to 38 % of the research yield and the yield gap for non-adopters was 488 kg/ha equivalent to 49 % of the research yield. The findings imply that adopters of improved coffee varieties gained 62 % of the yield potential while non-adopters gained 51 % of the yield potential. Likewise, the farmers’ actual yield was below the estimated yield with Soil Analysis for Fertility Evaluation and Recommendation on Nutrient Application to Coffee (SAFERNAC) model. The main factors positively influencing coffee yield at a 5 % level of significance include coffee variety planted, plant population, access to extension services, fertilizer applications, pruning and amount of fertilizer applied (g/tree). Therefore, farmers are encouraged to adopt improved coffee varieties to increase coffee yield through the improvement on implementation of recommended good agricultural practices which include proper fertilizer application, planting recommended coffee varieties, having enough plant population per unit area and proper weeding, pruning of coffee trees, soil moisture conservation, control of coffee pests and diseases. The descriptive statistics, Gross Margin (GM), Benefit-Cost Ratio (BCR), the Break-even analysis for yield and price and the sensitivity analysis of gross margin were used to compare profitability among adopters and non-adopters of improved coffee varieties for high-yielding, diseases resistance and with good beverage quality in the study area. The findings showed that the average variable costs of coffee production was 2 398 355 TZS/ha for adopters higher compared to 1 487 581 TZS/ha for non-adopters and also was statistically significance (p=0.000). The average variable cost per kilogram of parchment coffee produced was 2549 TZS for adopters and 3384 TZS for non-adopters. The GM for adopters was 5 451 666 TZS/ha higher compared to 1 727 389 TZS/ha of non-adopters with statistically significant difference (p=0.000). Likewise, the BCR for adopters was 2.16 higher compared to 1.18 for non-adopters with statistically significant difference (p=0.000). Meanwhile, the break-even price for adopters was relatively low compared to non- adopters and the break-even yield of adopters was relatively higher compared to non- adopters. The findings provide evidence that coffee farming using improved varieties was profitable for adopters compared to non-adopters because of high, GM, the BCR, the Break-even analysis for yield and price and the sensitivity of gross margin. Based on the findings of this study, the null hypothesis was rejected in favour of the alternative hypothesis that the government efforts of promoting and disseminating improved coffee varieties has positive impact on productivity and profitability among farmers. The socio-economic characteristics, institutional factors and farm characteristics showed a significantly influence the rate of adoption of improved coffee varieties. It is, therefore, recommended that government should continue supporting research and development of infrastructures to increase coffee seedlings multiplication and distributions. TaCRI in collaboration with TCB, LGAs, NGOs and private sector should speed-up the rate of coffee seedlings multiplication and dissemination to farmers. Also the government in collaboration with NGOs and private sector continue strengthen extension services in coffee growing zones. Finally farmers should be encouraged to adopt the improved coffee varieties and implement good agricultural practices to increase coffee productivity and profitability.

Tanzania Coffee Research Institute (TaCRI)