PROFITABILITY AND RESOURCE USE EFFICIENCY OF CAPSICUM PRODUCTION IN CHITWAN DISTRICT, NEPAL

Abstract

Unavailability coupled with inefficient and inappropriate use of resources is culminating into diminishing profitability and efficiency of vegetable production. This study aimed to analyze cost of production and resource use efficiency of capsicum enterprise in Chitwan district of Nepal uses Cobb-Douglas production function analysis to investigate the effects of different inputs on the returns from capsicum enterprise. Besides, descriptive statistics and t-test were also used. Primary data was collected from 66 randomly selected capsicum producers in Rapti Municipality and Bharatpur Metropolitan City using pre-tested semi-structured questionnaires. The total cost of production of capsicum in Chitwan district is NRs. 1,067,075.65 per ha; labour accounting the most of it at 22.14%. Capsicum production is found to be a profitable enterprise (BCR≈2). The return from capsicum production is likely to increase through improvements in use of fertilizer and plant protection inputs. Similarly, plant protection, seed and fertilizers are underutilized while labour, land preparation and harvest inputs are overutilized. In light of these findings, it is suggested that resources need to be allocated optimally in suggested proportions to get maximum returns. Also, labour costs can be minimized by introduction of mechanization for intercultural operations.