Abstract
Sunflower is among the key cash crops in Tanzania, which contribute significantly to the country’s economy. As it is the case for other crop subsectors, sunflower is also grown in abundance by smallholder farmers. Nevertheless, they had been living in poverty throughout their careers in agriculture which on the other hand benefited the counterparties in the trading deals. The unfair price offered to sunflower farmers was discovered in this study to be a misfortune in their investments. The conventional average farm-gate price of TZS. 622.449/Kg was found to be out of the price ranges that were backed by traditional cost accounting system, leaving farmers making losses of minimum TZS. 99.889/Kg. This study was conducted in Singida Region, Tanzania where a sample of 206 household farmers was used to obtain primary data on activity costs while the secondary data concerning the conventional price were obtained from the Districts’ sales reports and farmers’ records. Inferential statistics with one-sample test model was used alongside the IBM SPSS 26.0 statistical package in the quantitative data analysis. It was recommended, further studies to be conducted to explore more about the production cost that is backed by the activity-based costing (ABC) system, as it is more effective in assigning overheads to cost object than the traditional costing.
Highlights
Sunflower is among the agricultural subsectors in Tanzania, which were prioritized by Capital Markets and Securities Authority (CMSA) in a move of operationalizing the commodity exchange market in the country [14]
Tanzania was ranked among the top ten countries with the Godfrey Molela et al.: Sunflower Price Differentials Attributed to the Disparity of Traditional Cost Accounting and Conventional Methods in Tanzania highest production of the crop in the world, contributing to about 2.4% to the world basket [29]
Out of 206 households, 139 (67%) households responded to research questions by filling the structured questionnaires, while 67 (33%) households provided their answers to questions through the structured interviews conducted on individual basis
Summary
Sunflower is among the agricultural subsectors in Tanzania, which were prioritized by Capital Markets and Securities Authority (CMSA) in a move of operationalizing the commodity exchange market in the country [14]. This was one of the strategies promulgated by the government through its ten pillars of kilimo kwanza “agriculture first”, to enhance its performance through the coordination with the financial and industrial sectors, to work in a reciprocating manner [18]. Unreliable market, limited access to finance and the deficiency in technical knowhow were the eminent causes for the reported low production [21] These were the same reasons that faced the generic poor performance of the small-scale farming in Tanzania [19]. This study focused on the market aspect to contribute to the research gap associated with the farm-gate pricing which forms the elementary part of the market structure
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