Determinants of Commercialization of Smallholder Tomato and Pineapple Farms in Ghana

Samuel Asuming-Brempong

doi:10.9734/ajea/2013/2868

Abstract

Smallholder commercialisation may be broadly defined as the situation where farmers of small individual and family farms have greater engagement with markets, either for inputs, outputs, or both.A key premise of commercialization as a development strategy is that markets provide increased incomes to households who are able to maximize the returns to land and labor through market opportunities, using earned income for household consumption in ways that are more efficient than subsistence production. T his study assesses the characteristics of smallholder farmers in Ghana using tomato and pineapple production as a case study; analyses the relationship between commercialization and smallholder land holdings; assesses the determinants of commercialization of smallholder agriculture,as well as the benefits or otherwise of smallholder farmers from commercialization; and discusses how commercialization affects household food security among smallholder farmers. Descriptive statistics, correlations and regression analysis are used to describe the characteristics of smallholder farmers and determine the key factors

Highlights

A large literature exists on commercialisation — broadly defined as having greater engagement with markets, either for inputs, outputs, or both — of small, family farms
A key premise of commercialization as a development strategy is that markets provide increased incomes to households who are able to maximize the returns to land and labor through market opportunities, using earned income for household consumption in ways that are more efficient than subsistence production (Timmer, 1997; Pingali, 1997)
(a) Under what conditions may small farms be commercialised? (b) To what extent does commercialisation benefit smallholding households, and does it improve or worsen food security for the household? (c) What is the relationship between commercialisation and the size of land holdings of smallholder farmers, and does commercialization raise risks in the markets for these farmers? The objective of this paper is to address the foregoing questions, among others

Summary

Introduction

A large literature exists on commercialisation — broadly defined as having greater engagement with markets, either for inputs, outputs, or both — of small, family farms. A key premise of commercialization as a development strategy is that markets provide increased incomes to households who are able to maximize the returns to land and labor through market opportunities, using earned income for household consumption in ways that are more efficient than subsistence production (Timmer, 1997; Pingali, 1997). In Kenya for instance, 75 percent of national food needs and raw materials are provided by smallholder farmers, yet only 30 percent of them have access to credit facilities and other services to help them increase productivity. Evidence from elsewhere in sub-Saharan Africa indicates the key role of cash crops in driving processes of agricultural intensification and productivity growth through the development of credit facilities and input/output markets (von Braun and Kennedy, 1994; Dorward et al, 1998; and Shepard, 1999). Evidence from elsewhere in sub-Saharan Africa indicates the key role of cash crops in driving processes of agricultural intensification and productivity growth through the development of credit facilities and input/output markets (von Braun and Kennedy, 1994; Dorward et al, 1998; and Shepard, 1999). Govereh et al (1999) show the importance of institutional arrangements in such market development and the consequences of cash crop development for non-cash crop productivity gains

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