International Journal of Horticulture 2015, Vol.5, No.10, 1
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that on both theoretical and empirical grounds,
risk-sharing strategies provide opportunities for
dealing with the new (and the old) risks with which
agriculture is confronted. They concluded that
theoretically, risk-sharing tools are in principle
advantageous to both individual farmers and society
as a whole. Empirically, farmers already perceive
risk-sharing strategies (especially insurance) as
important strategies to manage risks.
Farmers’ attitudes towards risk can vary greatly and
are a key determinant in selecting risk management
strategies. A farmer with a strong aversion to risk will
be willing to pay more for a given level of risk
reduction than a farmer with a weaker aversion to risk
(USDA 1996). Taking more risks can increase a
farmer’s profit. However, like most people, farmers
are generally risk averse (Harrington & Niehaus 1999).
Farmers are willing to pay premium to reduce
exposure to risk. If farmers can trade away part of the
risks on their farm at an acceptable cost, the expected
utility for the farmer will increase (Arrow 1996). The
risk sources vary in importance from one enterprise to
another and from a group of farmers to another. The
California agricultural producers ranked output price
and input cost highest among their production and
financial risks (Blank & McDonald 1995). The
possibility of lower-than-expected yield is one of the
risks identified in the USDA’s 1996 Agricultural
Resource Management Study (ARMS) as a major
concern to farmers, particularly those planting major
field crops.
The objective of this study is to identify the risk
sources and their relative importance in plantain
farming under tropical condition and make
comparison between two ecological zones – derived
savannah and forest zones in the study area. This
study will help the current and prospective plantain
farmers to identify the existing and possible risk
management strategies associated with plantain
production at the individual farm levels in order to
increase production and farmer’s productivity, which
may lead to increase and steady supply of plantain to
markets and to ensure high and stable income to
plantain farmers.
Materials and Methods
Osun State is the study area. Osun State lies within 7
0
and 8
0
east of the Greenwich meridian. Agriculture is
the major source of income for over 70 percent of the
people in the area. The tropical climate in the area
favor the growth of annual crops such as yam, cassava,
maize, plantain and bananas and tree crops which
include cocoa, kolanuts and palm produce. The State
is divided into three agricultural zones (OSSADEP,
1997). These zones are Iwo, Ife/Ijesa and Osogbo with
headquarters at Iwo. Each zone is further sub-divided
into blocks and blocks into cells.
Multistage sampling technique was used in selecting
respondents for the study. The three agricultural zones
in the state were stratified into two ecological zones
on the basis of climatic factors namely, forest
(Ife/Ijesa zone) and derived savannah (Iwo and
Osogbo zone). Iwo was selected as representative of
derived savannah zone using simple random sampling
technique and the remaining zone which is the forest
(Ife/Ijesa zone) was chosen to obtain geographical
spread of the areas where plantain is being grown in
the State. Five blocks were selected from each
ecological zone, four cells chosen from each block
and five villages from each cell using simple random
sampling technique at each sampling stage. A farmer
was randomly selected from the list of plantain
farmers in each village. In all a total of two hundred
plantain farmers were selected. Data were collected
from them with the aid of a structured questionnaire.
Descriptive statistics was used to describe various risk
sources and risk management strategies while
importance index was used to rank them in order of
importance.
Importance Index: In order to determine the relative
importance of risks to plantain production, importance
index was constructed using the methodology adopted
by (McLean-Meyinsse et al., 1994). For the construction
of the index, plantain farmers were asked to give and
rank the risks to plantain production on an ordinal
scale, (1 being assigned to the most important, 2 to the
next most important and sequentially in descending
order of importance). For analysis, the scale was
reversed for ease of index construction. The mean
score computed for each identified constraint was
multiplied by the percent of the plantain farmers
identifying the constraint as the most important; to
obtain the importance index. The importance index
was constructed using matrices A, B and C as
indicated below:
