Professional Documents
Culture Documents
Submitted to:
Assistant Professor
Department of Agronomy
Rampur, Chitwan
Submitted by:
Nishan Khatri
Rampur, Chitwan
Table of Contents
Abstract............................................................................................................................................7
1. Introduction..................................................................................................................................9
1.1. Background............................................................................................................................9
1.2. Statement of problem.............................................................................................................9
1.3 Objectives.............................................................................................................................10
1.4 Scope and limitations of study..............................................................................................10
2. Literature Review.......................................................................................................................11
2.1. General introduction........................................................................................................11
2.2. Status of maize production in Nepal and Banke district......................................................11
2.3 Value Chain Activities in Maize Farm Business..................................................................12
2.4 Uses of Maize and Maize Products......................................................................................13
2.5 Maize Demand and Supply Situation...................................................................................13
2.6 Maize Grain Price Situation..................................................................................................15
3. Methodology..............................................................................................................................15
3.1. Lee site.................................................................................................................................15
3.2 Instruments and Design........................................................................................................17
3.3 Data & Data Types...............................................................................................................17
3.4 Data Analysis & Techniques................................................................................................17
3.4.1 Cost of production..........................................................................................................17
3.4.2 Benefit Cost Ratio..........................................................................................................18
3.4.3 Cost per unit product......................................................................................................18
4. Result and Discussions...............................................................................................................19
4.1 Learning from farm business and Sub-sector.......................................................................19
4.2 Learning from the organization and concerned stakeholders...............................................19
4.3 PESTIEL Analysis................................................................................................................20
4.3.1Political factor................................................................................................................20
4.3.2Environmental factor......................................................................................................21
4.3.3Social factor...................................................................................................................21
4.3.4Technological factor.......................................................................................................21
4.3.5Institutional factor..........................................................................................................22
4.3.6Economic factor.............................................................................................................22
4.3.7Legal factor....................................................................................................................22
4.4 SWOT analysis.....................................................................................................................22
4.4.1From View Point Of Producer.......................................................................................22
4.4.2From View Point Of Collectors/ Local traders..............................................................23
4.4.3From View point of Feed industries...............................................................................24
4.5 Business plan including cost of production, B:C ratio, production cost per unit and
sensitivity analysis
5. Key lesson Learned and learning……………………………………………………………...28
6. Conclusion..................................................................................................................................28
7. Recommendation........................................................................................................................29
7.1 To the farmers and proponents.............................................................................................29
7.2 To the other business actor...................................................................................................29
7.3 To the government and other stakeholders...........................................................................30
7.4 To the next internee..............................................................................................................30
References......................................................................................................................................31
Annexes.........................................................................................................................................32
LIST OF TABLES
LIST OF FIGURES
Figure 1. Area and Production trend of maize crop in Nepal for four years (2069/70 -2072/23)
........................................................................................................................................................12
Figure 2. Figure showing study site..............................................................................................16
LIST OF ANNEXES
Annex 1. Area, production and productivity of maize in Nepal and Banke district (2011/12-
2016/17).........................................................................................................................................32
Annex 2. Calculation of Benefit Cost Ratio.................................................................................33
Annex 3. Sensitivity Analysis by increasing total cost by 10% in maize seed production...........33
Annex 4. Sensitivity Analysis by decreasing revenue by 10% in maize seed production............34
Acronyms and Abbreviation
Maize (zea mays) is the primary stable and widely grown cereal in the world. In Nepal, maize is
second most important crop after rice with production of 2,231,517 metric ton and productivity
of 2.5 ton/ha (Ministry of Agriculture,2017). It is staple food crop of hilly region where 86% of
the total produce is used for human consumption where as in terai only 20% is used for human
consumption and rest is used to make feed for livestock and poultry (Ransom, Paudyal, and
Adhikari, 2003). With rapid increase of poultry industry, the demand of maize has been
increasing rapidly and the supply is unable to fulfill the demand of maize. Hence, there seems an
utmost action to be carried immediately to increase the production of maize.
Besides human power and animal power are still the main sources of farm power. Men
engagement in other profession has led to increased women drudgery and child labor in
agriculture. Furthermore, traditional practices being labor intensive adversely affects timeliness
of each operations, thereby reducing the yield. Thus, to overcome the gap between attainable and
potential yield, the only option is to increase the production within the constant limited land area
through the use of modern agriculture techniques and equipment. The traditional cultivation
practices, low technology adoption and poor mechanization have overall effect on production on
maize.
1.3 Objectives
The broad objective of this study was to identify the current status of maize production
technology with its opportunities and constraints to make further strategies and programs.
The objectives of the study are as follows:
a. To know the socio-economic condition of maize farmers.
b. To analyze the method adopted by farmers for maize cultivation.
c. To conduct business analysis of the maize crop as farm business.
d. To know various factors that has effect on the maize production, marketing
and utilization on the study site.
1.4 Scope and limitations of study
This survey explored the existing cost of production, its opportunities, economic feasibility, and
constraints of maize production in Banke district. Since Nepal has wide range of diverse agro-
ecology and environmental conditions, the result of the study may have limitations to make
generalizations and make them applicable to the country as a whole. However, it may be useful
for areas with similar context with the study areas. The size of the sample taken may not be
adequate. Likewise, farmer do not have knowledge about keeping record on various cost on
items, labor, inputs, etc., the exact data on those particulars are not obtained. The relevancy of
the information lies on the
assumption that the respondents have given true information. Time and budget constraints were
also major limitation of the study.
2. Literature Review
2.1. General introduction
Maize is the second most important crop after rice in terms of area (900,288ha) and production
(2,300,121mt) with yield 2,555 kg/ha in Nepal (MoAD, 2016/17). Maize (zea mays L.) is one of
the most important cereal grains grown worldwide in a wider range of environment because of its
greater adaptability (Kogbe and Adediran, 2063). Maize crop is widely grown crop with a high
rate of photosynthetic activity because of its C4 pathway, leading to higher grain yield and
biomass potential. It is pre-dominantly cross- pollinated species, a feature that has contributed to
its broad morphological variability and geographical adaptability.
Maize has become a staple food in many parts of the world. However, little of this maize is
consumed directly by humans; most is used for ethanol, animal feed and other maize products,
such as corn starch and corn syrup. Maize is one of the earning grain crops and it perhaps the
most versatile. By 2050 demand for maize will double in the developing world, and maize is
predicted to become the crop with greater production globally, and in the developing world by
2025 (Rosegrant et al.2008)
2071/72
2070/71
2069/70
Column1productionarea
.
Figure 1.. Area and Production trend of maize crop in Nepal since four years (2069/70 -2072/23)
However, analyzing the trend of production of maize, productivity of maize in Banke
district is less than that of national productivity.
Table 1. Area, Production and Productivity of maize of Banke District
Table 2. Monthly foreign trade statistics based on first eight-month data of fiscal year
2073/74
(Source: MoF, 2017)
3. Methodology
3.1. Lee site
The study was conducted in Duduwa rural municipality and Nepalgunj ward no.16 of Banke
district. Banke is terai district that lies in Mid-western region. The site is located 10-15 km south
east from Nepalgunj town and connected with Surkhet-Nepalgunj highway and some other sub
roads. The study area was selected purposively based on area of coverage of maize production,
number of maize growing farmers, production of maize and access to road facility. Based on
these, Duduwa area was selected to fulfill the aforementioned objectives. The map of Nepal
showing study district and study site is presented in figure 2.
Figure 2. Figure showing study site
3.2 Instruments and Design
At first, sampling frame was prepared by using various sources of information such as key
informants of the study areas, and village development committee (VDC). The progressive
farmer engaged in maize cultivation were selected as sampling unit. 60 commercial maize
growers, three of the agro vets and the feed industry of the selected VDCs had been sampled for
the study through simple random sampling
Total cost = ∑ of cost incurred in all the variable items + ∑ Summation of cost
incurred in all the fixed items
∑𝑛
𝑡=1 (1 𝐵+𝑡 𝑖) 𝑡
𝐵𝐶 𝑅𝑎𝑡𝑖𝑜 = 𝑛 𝐶𝑡
∑𝑡=1
(1 + 𝑖) 𝑡
Where,
Bt = incremental benefit in tth period due to farm enterprise
Ct=incremental cost in tth period due to farm enterprise
n= number of years
i = interest rate
Keeping farm enterprise by farmer will be financially feasible if the present worth of
incremental benefits is greater than the present worth of the incremental cost due to
farm enterprise or in other words B-C ratio exceeds one.
Cost per unit product = total cost of production / total volume of product in
quintal
4. Result and Discussions
4.1 Learning from farm business and Sub-sector
Maize being the common commodity for all the commercial farmers in the area, hybrid
maize cultivation under mechanization is one of the most profitable enterprise which
provides with better returns to the farmers within short duration. This business enterprise
requires scientific and technical way of management and cultivation practices for the better
yield. In order to increase the production and to reduce cost of production, different
management practices should be performed initially from time of sowing to the harvesting of
the product. Though farmers have the problem regarding insect/pest or fertilizers supply
prevailing in this year, but the major problem they are facing since years is with selection of
appropriate seeds, easy irrigation facilities and high labor cost. Likewise, Supply of the
adequate level of organic fertilizers and right dose of chemical fertilizers in right time is the
major challenge seen as they are not aware of nutrient requirement difference for hybrid,
improved and local maize varieties. Maintenance of the quality of maize (i.e. appropriate
moisture level of the grains after harvest) is another important factor for better marketing of
the maize as higher moisture level deteriorate the feed quality. Occurrence of heavy rainfall is
the major problem faced during summer maize. Soil erosion by wind and no or less use of
organic manure is major reason for soil fertility degradation and sustainability of agriculture
is in danger.
Unlike vegetables, maize do not have definite market, so, contract farming with feed industry
could encourage maize farmers to increase area and production under maize.
Opportunities Threats
suitable climate and soil Changing Rainfall Pattern
increasing demand of maize Insect and Disease incidence
(nationally and internationally) Increasing Transportation cost
increasing access to road and High Labor Cost
transportation Continuous load shedding
establishment of Zone of maize
in Banke
Establishment of post-harvest
Centre
Establishment of Large feed
industries
Strength Weakness
Access to the roads and low amount of collection
transportation Door to Door collection is
GroupWise Collection From difficult to carry out.
Cooperatives/ farmers group Inability of grading for quality
Ability to pay Cash for maize Lack of access to PAN no.
Nice coordination between local Lack of own storage house.
traders and urban traders
Opportunities Threats
All year-round maize production Constant Price Since long time
Increasing number of maize Quality maintenance for
farmers competition with Indian maize
Feed industry Establishment in Increasing Transportation Cost
zone area Strike/pandemic
4.5 Business plan including cost of production, B:C ratio, production cost per unit and
sensitivity analysis
Seed is basic and the most critical input for sustainable agriculture. A seed enterprise
involves producing and selling quality seed to farmers. The use of hybrids is common in
maize in Nepal. It is due to the commercialization, and easy availability of hybrid seeds in
agro-vets (though costlier). Unavailability and poor quality source seeds of national open
pollinated varieties (OPVs) is also forcing farmers to use hybrid seeds.
Here is the business plan for production of improved seeds of maize. The business plan is
prepared by using the data collected from the survey. It includes the cost of the production
which was the summation of variable cost like cost of seeds, fertilizers, pesticides, land
preparation, management cost, maintenance and repair cost etc. while the fixed cost includes
land rent, interest for the loan and depreciation cost. The seed production can be done in 3
seasons for a year. The cost of production is found to be Rs. 54970.40 with net profit of Rs.
24329.80 per season (4 months periods) and production cost per is Rs 39.25. Similarly, the
benefit cost ratio is found to be 1.35 (refers to Annex 2.). A sensitivity analysis is done by
increasing the variable cost by 10 % and decreasing gross revenue by 10% in which B/C ratio
was found still greater than means the maize seed enterprise is feasible in such adverse
condition also (refers to Annex 3. & Annex 4. ).
Table 3. Average cost of production & margin per hectare for seed production in Banke
Crop: Maize Year: 2019/20
6. Conclusion
It is undoubtedly that maize cultivation has become an integral component of the Nepalese
economy as it contributes to the national GDP and have been a major source of income to
rural farmers, employment opportunity and help in poverty reduction. The agro-ecological
diversity and climatic suitability both have been boon for the people of the Banke for the
commercial cultivation of the maize. The climate supports the production of maize all year
round so the commercial farmers have been able to get a good price. Maize is rising industrial
crop with assurance of market in the area. So, most of the people are attracted towards maize
farm business as it costs lower than rice production. With establishment of custom hiring
center and post-harvest center through zone implementation unit, PMAMP, farmers are
encouraged to increase area under maize cultivation.
7. Recommendation
7.1 To the farmers and proponents
The farmers should be able to utilize the comparative advantage of the agro-climate and
produce maize all year round as it will provide the better income throughout the year.
Although they are earning a good income through traditional farming practice but the main
mistake I o was observed was in the use of doses of fertilizer in right quantity as per
recommendation. Likewise, the maize grains from domestic level cannot compete with Indian
products in quality, quantity and price. In such situation, uses of recommended hybrid
varieties, farming through mechanization, conservation farming technology adoption, uses of
adequate quantity of both organic and inorganic fertilizers at right dose and right time along
with appropriate plant population maintenance can help to increase yield per hectare and
decrease production cost. Similarly, for the use of machineries major constraints is land
fragmentation and plotting, so, farmers should be encouraged to perform land pooling
through provision of more subsidies on seed, fertilizers and farm equipment and
machineries.
References
Cowieson. (2005). factors that affect the nutritional value of maize for broilers. animal feed
science and technology, 293-305.
Agricultural Development.
Advances.
Ransom, J., Paudyal,K.,& Adhikari,K. (2003). Adoption of Improved Maize Varities in the Hills of
Nepal.Journal of International Association of Agricultural Economics,299-305.
Rosegrant , M.R., Ringler,C., Sulser, T.B., Ewing, M., Batka,M., . (2008). Agriculture and Food
Security Under Global Change; Prospects for 2025/2050. Washington DC: IFPRI.
Sapkota, D., & Pokharel, S. (2010). Community based Maize seed Production in the Hills and
Mountains of Nepal. Agronomy Journal of Nepal,107-112.
Timsina, K. (2016). Maize production in mid hills of Nepal:from food to feed security. journal of
maize research and development.
Annexes
Annex 1. Area, production and productivity of maize in Nepal and Banke district (2011/12-
2016/17)
Year Nepal
Banke
Area Production Productivity Area Production Productivity
(ha) (Mt) (kg/ha) (ha) (t) (kg/ha)
2011/12 871,387 2,179,414 2.50 8,547 20,065 2.35
2012/13 849,635 1,999,010 2.35 10,697 29,760 2.78
2013/14 928761 2,283,222 2.45 8,500 15,300 1.80
2014/15 882365 2,145,291 2.43 8,900 19,238 2.15
2015/16 891583 2,231,517 2.50 8,500 18,863 2.21
2016/17 900,288 2,300,121 2.55 8,500 17,300 2.03
2017/18 954,158 2,555,847 2.67 9,034 19,569 2.16
2018/19 956,447 2,713,635 2.83 9,183 20,386 2.22
Year 1 2 3
Year 1 2 3
Total Cost 54970.40 54970.40 54970.40
cost increased by 10% 60467.44 60467.44 60467.44
Total Revenue 74260 74260 74260
13792.56 13792.56
incremental benefit 13792.56
Revenue @ 10% discount
rate 66834 60893.2 55695
Cost @ 10% discount rate 54420.696 49583.3008 45350.58
B/C RATIO 1.22809 1.22809 1.22809
Annex 4. Sensitivity Analysis by decreasing revenue by 10% in maize seed production
Year 1 2 3
Total Cost 54970.40 54970.40 54970.40
Total Revenue 74260 74260 74260
revenue decreased by 10% 66834 66834 66834
11863.6 11863.6
incremental benefit 11863.6
Revenue @ 10% discount
rate 60150.6 54803.88 50125.5
Cost @ 10% discount rate 49473.36 45075.728 41227.8
B/C RATIO 1.215 1.215 1.215