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Analysis of factors affecting the production of cashew in Wenchi municipality,

Ghana

Article  in  Journal of Agricultural Sciences – Sri Lanka · April 2013

DOI: 10.4038/jas.v8i1.5377

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ANALYSIS OF FACTORS AFFECTING THE PRODUCTION OF CASHEW IN

WENCHI MUNICIPALITY, GHANA

C. A. Wongnaa1

ABSTRACT

The study considered the determinants of cashew production with special reference to cashew
production in Wenchi Municipality of Brong-Ahafo Region of Ghana. Data collection was
through well structured questionnaire administered on 140 respondents selected through
random sampling technique. The methods of analysis used were descriptive statistics and
production function analysis using the Ordinary Least Square (OLS) criterion to estimate the
parameters of the production function. Results showed that majority of the farmers were ageing
and 55.7% of them have a maximum of five years of cashew farming experience. Also there was
high level of illiteracy as about 61.4% of total respondents have no formal education. Farming
was majorly on subsistence level as the mean farm size was 3.33 acres. Results further showed
that farm size, fertilizer, pesticides, pruning, education and contact with extension officers are
positively related to cashew output while labour and years of experience are inversely related.

Key words: Cobb-Douglas Production function, Ordinary Least Square, Cashew farming

INTRODUCTION

Agriculture is the predominant sector in cashew are from Brazil (Mitchell and Mori,
Ghana’s economy. In 2008, agricultural 1987). Cashew (Anacardium occidentale linn)
activities contributed to 33.6% of Gross is one of the important tree-nut crops, ranking
Domestic Product (GDP), employed about third in international trade after hard nuts and
60% of the labour force, and accounted for almonds (MOFA, 2007).
54% of foreign exchange earnings. The sector
itself is composed of five subsectors, namely The first ever recorded exports of cashew nuts
from Ghana was in 1991, amounting to 15
crops other than cocoa, livestock, fisheries and
forestry. However, non-traditional crops, such metric tonnes. In 1997, export volumes rose to
as pineapple, mango and cashew nuts, are 3,571 metric tonnes. According to the Ghana
increasingly of importance to the Ghanaian Export Promotion Council, 2002, the country
economy (MOFA, 2007). exported 3,893 metric tonnes of cashew valued
at $1,450,306. This export figure increased by
Cashew is one of the non-traditional export 79.15% in 2003 to 6,338 metric tonnes, which
crops being given the necessary boost by was valued at $1,598,636. Annual export
the government of Ghana. Cashew has a of raw nuts reached 47,000 metric tonnes in
long history as a useful plant and only in the 2006, contributing approximately US$ 23
present century it has become an important million in foreign exchange earnings. This
tropical tree crop. The earliest reports of figure is considered very small when compared

Institute of Entrepreneurship and Enterprise Development, Kumasi Polytechnic, Kumasi,

1
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Ghana.
The Journal of Agricultural Sciences, 2013, vol.8, no1

with world excess demand of 430,000 metric sold, farming experience and sources of
tonnes of raw nuts, valued at US$270 Million, finance. Also the study made use of secondary
and growing at a rate of 5-8% per annum. It data obtained from the internet, academic
is therefore obvious that demand continuous journals, libraries and the Ministry of Food
to exceed supply; meanwhile there are many and Agriculture (MOFA).
cashew farmers in Ghana and their productivity
is on the lower side (MOFA, 2007). This study Conceptual framework
was designed to analyse the determinants of The economic model commonly used to
cashew production in Wenchi Municipality of determine the relationship between the
Brong-Ahafo Region of Ghana. various factors and the output in agriculture
is production function model. The production
function of any farmer is determined by
MATERIALS AND METHODS resource availability of the farmer. In
agriculture, the production inputs consist of
Study area and Data Collection land, labour and capital as the basic factors
The study was carried out in the Wenchi of production. The expected relationship
Municipality in the Brong-Ahafo Region of between output and land is that as more land is
Ghana as it is the major cashew production brought under production, output is increased
zone in Ghana. The study area lies between (Malassis, 1975). The simplified form of
latitudes 7°27N and 8°30N and longitudes production function is given by:
1°30N and 2°36W. The Wenchi Municipality Q=f(L_d,K,L) (1)
occupies an area of 7,619.7 square kilometres
and a population density of 5-20 persons per
square kilometre. The study used both primary
and secondary data. Primary data was mainly Where Q is the production output, which is
cross-sectional. It was collected from 140 a function of land (Ld), the capital (K) and
cashew farmers randomly selected from lists the labour force (L) used for the production
of cashew farmers in the following farming of the same output. A production function
communities: Akrobi, Awisa, Nkonsia and may be defined as a mathematical equation
Abotareye, the 2009-2010 production season. showing the maximum amount of output that
The communities were purposively selected can be realized from a given set of inputs.
based on the level of cashew production. In The mathematical form of the Cobb-Douglas
each community 35 cashew farmers were production function is given by:
randomly selected. Variables included in Q=ALα Kβ (2)
the questionnaire were: initial capital outlay
or establishment cost, area of land under Where Q is the output, A is the technology
cashew cultivation, labour input in land used in the production of output, L is labour
preparation, planting, weeding, fertilizer, input, K is capital input and and are elasticity.
pesticide application and harvesting, the Alternatively, a production function can show
quantities of pesticides and fertilizer used in the minimum amount of inputs that can be
cashew cultivation. Others include farmer’s utilized to achieve a given level of output
age, farmers’ educational level, gender, (Malassis, 1975). To find out the impact of
whether or not farmers pruned their cashew these factors on farm level production of
trees, whether or not farmers used improved cashew on small-scale farmers in Wenchi
seeds, household size, farmers contact with Municipality, the functional relationship is
extension workers, economic part of cashew specified.

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 The Journal of Agricultural Sciences, 2013, vol.8, no1

The econometric model is specified as follows

Specifications of the Empirical Model lnOUTPUT = lnβ0+ lnβ1FAMS + lnβ2 LAB +

lnβ3CAP + lnβ4 FERT + lnβ5 PEST + lnβ6 EDU
OUTPUT=f (FAMS, LAB, CAP, FERT, PEST,
+ lnβ7 EXP + lnβ8D1 + lnβ9D2 + lnβ10D3 + u
EDU, EXP, EXTC, D1, D2, D3, u)
(3)
(4)

Where, Estimation techniques

OUTPUT = Cashew nut output (in Using Ordinary Least Squares (OLS) technique,
kilogrammes of cashew nut) the coefficients of the above variables were
estimated. For the study to estimate with
FAMS = Farm size (in acres) OLS, the Cobb-Douglas production function
had to be a transformed model, to satisfy the
LAB = Labour quantity (in man-days) Classical Linear Regression Model (CLRM),
CAP = Physical capital (in Ghana cedis (Gh¢) so as to come up with the usual assumption of
spent on equipments) Best Linear Unbiased Estimator (BLUE).

FERT = Fertilizer used (in litres)

PEST = Pesticides used (in litres) RESULTS AND DISCUSSIONS

EDU = Educational level of farmer (in years Descriptive Analysis

of schooling) Evidence from the descriptive analysis of
EXP = Experience of farmer (in number of socioeconomic characteristics of respondents
years in cashew farming) in the study area in Table 01 shows that 61.4%
of the sampled cashew farmers were males
D1 = Dummy for variety (1 for improved type and 38.6% were females. The results show that
and 0 for local type) more men are involved in cashew production
in the Wenchi Municipality than women.
D2 = Dummy for pruning (1 for pruning and 0 This is consistent with the results of CASCA
for no pruning) and (2002) which revealed that most cashew trees
or farms are owned by men (60%) while the
D3 = Farmers’ contact with extension officers,
other 40% are divided amongst women (10%),
measured as a dummy (1 for extension contact
the family as a whole (15%) and grandparents
and 0 for no extension contact)
(15%). It also shows that both men and women
u = stochastic error term. can take cashew production as a business and
a source of employment.

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C. A. Wongnaa

Table 01: Socioeconomic Characteristics of Cashew Farmers

Characteristic Frequency Percentage (%)
Gender
Male 86 61.4
Female 54 38.6
Total 140 100.0
Age
≤20 0 0.0
21 – 40 36 25.7
41 – 60 68 48.6
61 – 80 36 25.7
Total 140 100.0
Education
Illiterate 86 61.4
Primary 24 17.1
Middle School/JSS 15 10.7
SSS/Vocational/Technical 10 7.1
Post Secondary/Tertiary 5 3.7
Total 140 100.0
Pruning
Do pruning 74 52.9
Do not do pruning 66 47.1
Total 140 100.0
Cashew Varieties
Improved 44 31.4
Local 96 68.6
Total 140 100.0
Household Size
1 – 5 81 57.9
6 – 10 40 28.6
>10 19 13.5
Total 140 100.0
Farming Experience (Years)
≤5 78 55.7
6 – 10 34 24.3
11 – 15 20 14.3
>15 8 5.7
Total 140 100.0

Source: Field Survey data, 2010

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 The Journal of Agricultural Sciences, 2013, vol.8, no1

Table 01: continued

Characteristic Frequency Percentage (%)
Sources of Finance
Personal Savings 91 65.0
Friends 10 7.1
Relatives 9 6.4
Cooperatives 12 8.6
Bank Loans 18 12.9
Total 140 100.0
Contact with Extension Officers
Contact 42 30.0
No Contact 98 70.0
Economic part of cashew sold
Apple 0 0.0
Nut 140 100.0
Total 140 100.0
Source: Field Survey data, 2010
The results of the study show that most education while very few of them (3.7%)
cashew farmers in Wenchi Municipality got to the Post Secondary and Tertiary level.
are ageing since a greater percentage of The higher percentage of illiterate farmers
the cashew farmers interviewed (74.3%) could have negative impact on the adoption
were above forty (40) years and none of the of new production technologies. Generally
respondents was below twenty (20) years. education is thought to create a favourable
Very few cashew farmers in the municipality mental attitude for the acceptance of new
(25.7%) were between the ages of twenty-one practices especially of information-intensive
(21) and forty (40) years. Farmers in this age and management-intensive practices (Waller
group constitute the very energetic youth and et al., 1998; Caswell et al., 2001). Education
are likely to work effectively to increase their is thought to reduce the amount of complexity
yields. The few number of youth involved in perceived in a technology thereby increasing
cashew production (25.7%) could indicate that a technology’s adoption. According to Ehler
the future of the cashew industry, especially in and Bottrell (2000), one of the hindrances to
the Wenchi Municipality is bleak. The youth widespread adoption of especially Integrated
are the future growers of the cashew crop and Pest Management (IPM) as an alternative
if cashew nut supply is to be sustained, there method to chemical control is that it requires
is the need for youth to be encouraged to go greater ecological understanding of the
into cashew production. From the study, it was production system.
realised that a higher percentage of cashew
farmers in Wenchi Municipality (61.4%) are The results of the study revealed that a greater
illiterate. Such farmers did not receive formal percentage of cashew farmers in the Wenchi
education. About 17.1% of cashew farmers in Municipality (52.9%) pruned their cashew
the Wenchi Municipality ended in the primary trees while 47.1% did not do pruning. The
school while 10.7% of them were educated results show that most cashew farmers in
up to the Middle or Junior Secondary School Wenchi Municipality probably have identified
level. Some cashew farmers in the municipality pruning as a very important cultural practice in
(7.1%) had Senior Secondary School cashew production. There is however the need

12
C. A. Wongnaa

for increased awareness of the importance of variations in cashew output are explained by
pruning in cashew production since 47.1% of the factor inputs. Also from the F-statistic it
the respondents did not do pruning at all. can be concluded that the overall regression is
significant at 1% significance level. The values
The results showed that only 31.4% of cashew of the coefficients indicate the elasticity of the
farmers in the Wenchi Municipality used various inputs to the output. Considering farm
improved varieties of cashew while the rest size, the elasticity value indicates that if land
(68.6%) used local varieties. under cultivation is increased by 1%, the yield
The results of the study showed that cashew of cashew would increase by 92.4%. If quantity
nut is the main product of the cashew crop of of fertilizer, pesticides, pruning, education and
economic importance in Wenchi Municipality. contact with extension officers increase by
Also, a greater proportion of cashew farmers 1%, yield of cashew would increase by 8.7%,
in the Municipality (65%) financed their 4.3%. 43%, 12.6% and 12.5% respectively,
production through personal savings. The because they are positively related to cashew
distribution of the household size indicated output. This is in line with the results of
that most cashew farmers in the Municipality Goni et al., (2007) who conducted a study
(57.9%) had a household size that ranged from into the analysis of resource-use efficiency
1 to 5 while the average farm size was found to in rice production in the lake Chad area of
be 3.33 acres. The study also revealed that 70% Borno state, Nigeria and found out that a unit
of cashew farmers in Wenchi Municipality increase in the level of seed, farm size, and
have no access to extension service. Most fertilizer will lead to 12.6, 127.2, and 20.5
studies analyzing access to extension service percent changes in rice output respectively.
in the context of agricultural technology show Abang et al., (2001) also reported that
its strong positive influence on adoption. In education was positively related to the value
fact Yaron et al., (1992) show that its influence of marginal product though not statistically
can counter balance the negative effect of lack important. This might be due to the fact that
of years of formal education in the overall educated farmers were able to adhere to and
decision to adopt some technologies. Finally, adopt new farming technologies. Others such
most cashew farmers sampled had less as Aderinola (1988), Aderinola and Kolawole
than five (5) years of experience in cashew (1996), Eremie and Akinwumi (1986) and
production. This could have a negative impact Ojo (2000), investigated the productivity of
on output. sugar cane production, mechanized food crop
farming, rice production and maize farming
Cashew production function analysis respectively and they found out that farmers’
socio-economic characteristics including
From the regression results in Table 02, farm education and experience were significant
size, labour, fertilizer, pesticide, pruning, determinants of agricultural production and
education and contact with extension officers profitability. Imoudu (1992) also showed
were observed to affect cashew output that farm size is a significant determinant
significantly and hence are the determinants of maize output and profitability in Ondo-
of cashew production in the study area. Farm State. The results of the study are also in
size, labour and pesticides were significant consonance with those of Ohajianya (2006)
at 1% whereas fertilizer and education were in Imo State, Nigeria, and Onyenweaku et
significant at 5%. Pruning and contact with al., (1996). Labour and years of experience
extension officers were also significant at however had negative coefficients indicating
10%. The R2 value for the regression is that an increase in labour and years of
0.840912 and this means that 84.1% of the experience will lead to a decrease in yield and

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 The Journal of Agricultural Sciences, 2013, vol.8, no1

this corroborates Stephen et al., (2004), who ageing and quite inexperienced in cashew
studied on resource-use efficiency in cowpea production. Also, the level of illiteracy was
production in North East Zone of Adamawa very high among the respondents as about
State, Nigeria and reported an inverse 61.4% of total respondents had no formal
relationship between labour and output. The education while 17.1%, 10.7%, 7.1 and 3.7%
negative sign of years of experience is contrary had primary, Middle School/JSS, secondary/
to a priori expectation. This is probably due Vocational and tertiary education respectively.
to the fact that farmers with long years of Respondents are majorly small-scale farmers
experience are used to obsolete methods of with a mean farm size of 3.33 acres. Results
farming, traditional tools and species which further showed that variables such as farm
do not encourage high output. size, fertilizer, pesticides, pruning, education
and contact with extension officers are
CONCLUSION positively related to cashew output while
Findings from the study indicate that cashew labour and years of experience are inversely
farming in the municipality is a male dominant related. Farmers should be encouraged to
activity with the men making up 61.4% of the use fertilizers and pesticides so as to increase
respondents sampled. Most of the cashew productivity. Among other things, farmers
farmers in the study area (70%) have no contact should have more access to extension services
on a regular basis with extension agents. Also, in order to improve their knowledge of farm
a greater proportion of cashew farmers in the management. Also, the government should
Municipality (65%) financed their production introduce the farmers to formal education
through personal savings. That is most farmers through adult literacy education, evening
do not receive financial assistance in the form classes and establishment of demonstration
of credit from formal sources. The results farms.
also showed that majority of the farmers were
Table 02: Estimates of the Production function analysis

Dependent Variable: lnOUTPUT

Variable Coefficient Std. Error t-Statistic Prob.
C 5.106303 0.739814 6.902142 0.0000
lnFAMS 0.923613 0.188644*** 4.896063 0.0000
lnLAB -0.022457 0.185277*** 0.121206 0.0007
lnCAP 0.043158 0.189123 2.456227 0.0289
lnFERT 0.087111 0.024699** 3.526886 0.0226
lnPEST 0.042582 0.018065*** 2.357151 0.0099
lnEDU 0.125941 0.047278** 2.663864 0.0187
lnEXP -0.425361 0.012548 2.335458 0.1591
lnD1 0.222333 0.092272 2.409537 0.5174
lnD2 0.429783 0.163515* 2.628402 0.0796
lnD
3 0.125354 0.135458* 5.124535 0.0821
R-squared 0.840912 Mean dependent var 6.442207
F-statistic 98.92029
Prob (F-statistic) 0.000000
Note: (***) Indicates significance at the 1% level. (**) indicates significance at the 5% level.
(*) indicates significance at the 10% level
Source: Field Survey data, 2010
14
C. A. Wongnaa

ACKNOWLEDGEMENT about the cashew crop. They are also grateful

to the respondent farmers ,without whose co-
The authors are especially indebted to the operation the study could not have taken place.
staff of the Ministry of Food and Agriculture
(Wenchi) for the information they provided

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