Resource Use Efficiency of Potato Production among Smallholder Irrigated Farmers in the Eastern Cape Province of South Africa

Abstract

Potato (Solanum tuberosum L.) is Africa’s second most-grown crop and is widely used as the staple food after maize. The demand for potato production is increasing and growth in the area under production is estimated at 1.25% a year. Potato has great potential when it comes to food security and farm returns for many smallholder farmers. However, potato productivity is relatively low due to many factors that contribute to the low yield (including drought, poor production practices, and limited access to high-quality seed) and inefficient use of resources. Potato farmers have no access to formal markets, which may reduce the profitability of their enterprises. Additionally, while many studies have been conducted on the resource aspect of vegetable crops, very little is known about the profit efficiency of potato producers in the country. At the same time, efforts to commercialize potato production have not delivered the expected outcomes. This study aimed to estimate the profitability of potatoes, evaluate farm-level efficiency, and identify the factors that influence the efficiency levels of potato farmers in the Eastern Cape Province who engage in irrigation farming. The study used multi-stage and snowball sampling to select 150 smallholder potato farmers from whom primary data were collected using close-ended questionnaires. The data were analyzed using descriptive, gross margin analysis and translog stochastic profit frontier (SPF) modelling. The study found potato production to be profitable by as much as ZAR 7027.11 per annum. It is shown that farm size under potato, seed, pesticides, and fertilisers contribute positively towards the improvement of efficiency while labour and hired tractors negatively affect efficiency. The average technical efficiency of potato production among irrigated smallholder farmers was 89%, indicating that potato farmers could increase output by 11% without increasing inputs. Potato farm size, years spent in school, access to extension services, family size, and non-farm income are socio-economic and institutional factors influencing the farmers’ technical efficiency. However, the farmer’s age, access to credit, and cold storage had a negative effect on their productivity. The study recommends that government and non-governmental organisations strengthen the existing extension service provided to smallholder farmers and make efforts to provide farmers with long-term training and education to increase their productivity.