2Department of engineering, Bahirdar Polytechnique institute, Bahir Dar, Ethiopia
The study area is located in two woredas depending upon the crop type. Mecha and South Achefer woreda for maize production and Dera woreda for rice production. Both were selected purposively and it is a potential area for these two crops. Moreover, irrigation production is common in this area during dry seasons.
- RUMPTSTAND two wheel tractor is a multi-purpose plowing machine and it works like farmers’ ploughing practice with a hand hoe which could make it successful in African markets (Figure 1a). The small size of the tractor and the possibility of making many of its parts locally makes it easily accessible by private investors, small holder farmers or cooperatives in Ethiopia.
- Oxen plowing: This is a locally available technology which is made of metal ploughing end called Marasha (Figure 1b). An ox ploughing in Ethiopia is common practice and was started 3000 years ago in the highland parts of Ethiopia.
From three woreda twenty two participant farmers were selected by considering wealth-class, gender, crop type and soil type. These farmers were selected in collaboration with village level development agents based on their willingness to use technology and to cooperate in the trial. Among the twenty one participant farmers, sixteen were male and five were females. From these farmers, seven participated in the rice study (Dera woreda) and 15 farmers participated in the maize study at South Achefer and Mecha woredas. For the trial Nitisol and Vertisol soil types were used for the experiment, i.e. the rice was planted in Vertisols and maize on Nitisols. For the study, both qualitative and qualitative data were collected using structured questionnaire and experiment recorded sheets.
The annual tractor use required for economic viability was evaluated using break-even point analysis. According to Paman., et al. (2010), the break-even area was calculated by dividing the fixed costs per annum by differences between the service charge and the variable costs.
CR (X)-AVC(X) =AFC (2)
X (CR-AVC) =AFC (3)
X= breakeven hectare; i.e., the required hectares needed to cover the total annual cost of tractor use
CR= custom or contract rate in Birr/ha
AFC= average fixed cost per year is the sum of depreciation (D) and interest on capital
AVC= average variable cost in Birr per hectare
b) Opportunity cost (Interest on investment): The formula for calculating opportunity cost (average annual investment) is given by
- Capital investment is the market price of RUMPTSTAD 2-wheel tractor and oxen plough considered for this analysis.
- Scrap/salvage value of the tractor: Salvage value is the remaining value of an asset after its economic life. It was calculated based on others researchers’ work and standardized estimates. Since RUMPTSTAD 2WT is introduced to Ethiopia in recent times and no remaining value cost data is established before. But by considering trends in other machineries salvage value the remaining value is assumed to be 20% of the initial purchase price in the depreciation period of the tractor.
- Service life for tractor: Service life is the period over which the equipment can operate at an acceptable operating cost and productivity. According to Celerina and Maranan, (1983), standard, the economic life of 2-wheel tractor is estimated to be 8 years.
- Fuel and oil consumption: The cost of fuel was 20 ETB/Lt and the average fuel consumption was about 2 liters per hour. It is recommended that oil and grease = 0.10 × fuel cost, but for this analysis, 15% of oil and filters were used.
- Repair and maintenance costs. The cost of tractor repair and maintenance depends on the frequency of tractor breakdowns. Data from the trial indicates that the most frequent breakdowns were due to problem of belts and handle this might be from frequent stopping and starting under plowing. The two wheel tractor is only used for plowing purpose in this case no other ploughing activities like seeding and line marking. For this analysis, 5% of purchasing price used.
- Tax: many researchers used and calculated as 0.30% of purchase price and insurance 0.20% of the purchase price. For this trial analysis we did not consider tax and insurance (as it is at instant time).
- Partial budgeting: The first step in doing an economic analysis of on-farm experiments is to calculate the costs that vary for each treatment. Costs that vary are the costs (per hectare) of purchasing inputs, labor, and machinery that vary between experimental treatments. Farmers will want to evaluate all the changes that are involved in adopting a new practice. It is, therefore, important to take into consideration all inputs that are affected in any way by changing from one treatment to another (CIMMYT, 1988). However, in our trial on a field scale, all inputs assumed constant (like seed, fertilizer and other activities) except the treatments (use of tractor and use of oxen ploughing).
- Opportunity cost: Not all costs in a partial budget are opportunity costs. Opportunity costs necessarily represent the exchange of cash. The opportunity cost can be defined as the value of any resource in its best alternative use. In the case of labor, for instance, farmers may do the work themselves, rather than hire others to do it.
- Total cost that varies. Once the variable inputs have been identified, their field prices determined, and the field costs calculated, the total costs that vary for each treatment can be total costs that vary calculated. The total costs that vary are the sum of the costs that vary for a particular treatment.
A total of twenty one farmers participated and the majority of them are male headed farmers and few of them are female headed, selected based on the criteria of the experiment. As shown in Table 1, the majority were male and the rest female households. The educational status of the sample farmers poor, among them 33 percent were found to be illiterate followed by of grade 4 completed household’s head.
|Sex of households||Male||16||76|
|Model farmer or not||Yes||12||57|
|Access to market||Yes||19||90|
|Adult and religious education||2||10|
|Grade 1-5 completed||8||38|
|Grade 7-10 completed||3||14|
|Grade 12 completed (10+2)||1||5|
|Total family members (no)||19||1.00||4.00||2.32|
|Total land size owned by the household in Timad (1/4ha)||21||0.13||2.50||1.06|
|Distance from the main market in (hours)||19||0.50||2.00||1.26|
|Total tropical livestock unit (TLU)||18||2.07||10.63||5.55|
Field capacity of RUMPTSTAD 2WT
Field capacity is one of the performance measures of tillage implements (Bukhari., et al. 1988). In the experiment the field capacity of RUMPTSTAD 2WT was assessed. The field capacity of a farm machine is the rate at which it performs its function. Measurements or estimates of field capacities of a tractor are used to schedule field operations and to estimate operating costs. The most common measure of field capacity for tillage implement is expressed in the area ploughed per unit time of operation.
|Wereda||Area Ploughed||Time Taken (hr)||Fuel Consumed (lt)||Fuel Cost||Fuel cost /ha||Fuel consumption (lt/hr)||Fuel consumption (lt/ha)||Ploughing capacity (ha/hr)|
Note: trial crops; Dera Woreda for rice, Mecha & South Achefer woreda for Maize crops
The optimal land preparation condition for both RAMPTSTUD and control (Rice) practice was determined by the host farmers. Hence, the ploughing frequency was variable between fields. For the rice treatment, the ploughing frequency of rice ranges between 2 and 5. The mean was 3.77. In the production of maize, the minimum frequency was 2 and the maximum 6 and it has a mean of 5.51. In the case of ploughing by RUMPSTAD 2WT, all the fields were ploughed under dry condition. The maximum and minimum frequency of ploughing were 2 and 1, respectively. The average frequency of ploughing was 1.6.
Even though family labour is commonly used for farm operation in rural household area, the opportunity cost of labour needs to be considered. The average labour rate and time requirement for each farm activity presented in Table 4.
|No||Farm operations||Labour rate (ETB/ Man-day)||Man-day/ha|
|1||Ploughing (oxen)||70||150||4 man days||4|
|Ploughman||70||100||13 man days||4|
|Fertilizer applicator||50||50||4 man days||4|
|Seeder man||50||50||4 maydays||4|
|4||Harvesting||60||80||24 man days||8|
|5||Threshing*||60||100||12 man days||10|
Fixed costs (costs of owning a pair of oxen and ploughing equipment)
The annual costs of owning a pair of oxen and ploughing equipments are estimated. According to the result obtained in the study area, it costs about 14743.15 ETB to own and maintain a pair of oxen per year (Table 5) and based on the survey, the working life of oxen is estimated to be about 7 years.
|Oxen (they maintain their value)||0|
|Initial cost of plough||13700|
|Working years or life||7|
|Average annual investment = 11410.575||1939.79|
|Interest rate = 17%|
|3||III. Feed & management||9303.76|
|4||IV. Shade construction for oxen||2594.16|
|No||Plough tool (shear & Wegel)||Annual Costs|
|1||initial cost of plough=255.75||51.59|
|Working years or life=14|
|Annual depreciation= 233.75-0/14|
|Average annual investment = 255.75/2* 0.17= 21.73|
|Interest rate = 17%|
|Yoke, beam, handle, miran, digir, and others|
|Initial cost =260.55||66.26|
|Average annual investment = 22.14675|
|Interest rate = 17%|
The average annual cost of owning a pair of oxen found to be 14953.5 ETB (Table4 and 5). This cost is fixed irrespective of the size of land ploughed. Hence, as the size of land ploughed increases the rate of ploughing cost (ETB/ha) decreases. Therefore, in order to estimate the maximum ploughing potential of a pair of oxen in the study area, the average working days per year has to be known. In doing so, the average yearly working days of drought oxen was collected in the study area and it was found to be 60 days per year. Similar results were reported by Gryseels and Anderson (1983) who explained that, oxen only worked for about 60 days a year and the rest of the time they do not use for productive agricultural purposes. Hence, considering the average yearly working days (60 days for drought oxen), it requires 16 days to plough a hectare of land 4 times (average ploughing frequency). This implies that a pair of oxen can only sustain 3.5 ha/year ((60days/year)/(16days/ha)).
In order to understand the charge for ploughing their field or transporting their crops or undertaking any other task, it is necessary to understand the total cost to own and operate the equipment on an hourly basis (Heney, 2009). The first thing to do is to work out the annual costs of simply owning the machinery; i.e. the fixed costs. These include depreciation, housing, insurance, road tax and the interest you are paying on any loan (Table 7).
|Tractor drive (assumes the farmer to drive)||0|
|Purchase price||= 187000|
|Salvage value = 20% of Purchase price||= 37400|
|Economic life||= 8years|
|Tractor Depreciation = (187,000 – 37400)/8yrs||=18700|
|2.||Interest estimated as 17% of average investment in
machinery (187,000 +37400 / 2) x 17%
|3||Tractor shed(housing) depreciation = (10,000/10 yrs)**1||1000|
|Total Fixed cost (ETB/ year)||43860.4|
|No||Items||Hourly cost (ETB/hr)|
|1||liters of fuel cost (table-3, 1.29 lt/hr and $ birr 16.1/1t)||20.8|
|2||Oil and filters (estimated at 15% of fuel cost)***||3.1|
|3||Repairs and spares (estimated as 5% of purchase price)
=187,000 *0.05%= 9350 per year
*** Nebraska tractor test (Pflucger, 1994)
A comparative analysis between oxen ownership and tractor hiring was done which indicated that tractor hiring is still cheap as compared to holding or purchasing a pair of oxen for ploughing activity. The BEP in this analysis is four hectares of land (figure 3). Until this point, it is not worth to invest or purchase oxen for ploughing. Total hiring of tractor cost per year is cheaper than purchasing of oxen, though oxen ownership has its social and status of the society in the study area.
The cost benefit analysis technique is a powerful tool if all the costs and all the benefits can be identified. The difficulty with it is that some of the costs and benefits are not easily quantified. Hence, partial analysis is a common tool to use in different farm plan decisions as it considers partial or part of the whole plan of the farm.
The authors thank financial support of Wageningen, The Netherlands and Tibebe General Trading (TGT), Addis Ababa, Ethiopia for providing the funds for the research work. The authors would also like to thank the developmental agents and district leaders, farmers in the community and field assistants for their provision and assistance for the constructive feedback for working with us throughout the survey time.
This research was financially supported by The Netherlands and Tibebe General Trading (TGT) Addis Ababa, Ethiopia.
- Anderson F and Abiye Astatke. “Pond excavation using ox-drawn scoops in rural Ethiopia: The experience of two Peasant Associations in Debre Berhan area”. Highlands Programme Working Document, ILCA, Addis Ababa, Ethiopia (1985):
- Astewel Takele and Yihenew G Selassie. “Socio-economic analysis of conditions for adoption of tractor hiring services among smallholder farmers, Northwestern Ethiopia”. Cogent Food & Agriculture 4.1 (2018): 1453978.
- Aune JB., et al.“The ox ploughing system in Ethiopia: can it be sustained?” Outlook on Agriculture 30.4 (2001): 275-280.
- Burton W Pflucger. “Farm machinary cost, owen, lease or custom hirie. Extention from financial management specialist, incooperation with Lorry Modsen, Alan May, Curtis Hayt, and Ralph Motz extention area from managemnt agents”. SDSU Economics department (1994):
- Bukhari S., et al. “Mirani Performance of Selected Tillage Implements, Agricultural Mechanization in Asia, Africa and Latin America”. 19.4 (1988): 9-14.
- Celerina L and Maranan. “The consequences of small rice farm mechanization project comparative evaluation of tractor and Carabao use in rice land preparation”. Nueva Ecija, Philippines 91 (1982):
- CIMMYT. “From agronomic data to farmer recommendations, economic analysis”. (1988):
- FAO and UNIDO. “Agricultural Mechanization in Africa time for action: planning investment for enhanced agricultural productivity”. (2008):
- Faleye T., et al. “Improving small-farm productivity through appropriate machinery in Nigeria (Review)”. International Research Journal of Agricultural Science and Soil Science 2.9 (2012):386-389.
- Gryseels G., et al. “The use of single oxen for crop cultivation in Ethiopia”. Cooperative Agricultural Program Annual Report (1984):
- Gryseels G and Anderson FM. “Research on farm and livestock productivity in the central Ethiopian highlands: Initial results, 1977 – 1980”. Research Report 4 (1983):
- Jennifer Heney. “Explaining the finances of machinery ownership”. Rural Infrastructure and Agro-Industries Division Food and Agriculture Organization of the United Nations Rome Italy (2009):
- “International Livestock center for Africa (ILCA)”. Annual Report (1984):
- Larry K Bond and Richard Beard. “The cost of owning and operating farm machinery”. (1997):
- Melaku T. “Oxenization versus Tractorization: Options and Constraints for Ethiopian Framing System”. International Journal of Sustainable Agriculture 3.1 (2011): 11-20.
- Muhammad Yusuf Maamun. “Financial analysis of tractor purchase decision in south Sulawesi”. Department of agriculture economics (1991):
- Paman U., et al. “The Economic Potential of Tractor Hire Business in Riau Province, Indonesia; A Caa retse of Small Tractor Use for Small Rice Farms”. Agricultural Engineering International: the CIGR Ejournal XII (2010):
- Pathak., et al. “Management and utilization for work”. Paper presented to the Expert Consultation of Appropriate Use of Animal Energy in Africa and Asia (1984):