An economic analysis of coconut production in Kwale district ,Kenya

Abstract

This study, conducted in Kikoneni location of Kwale district, was prompted by Kenya's net importation of vegetable oil, whereby it spends almost US$ 80 million or Ksh 4.5 billion annually to purchase 200,000 metric tons of vegetable oil (80% of its domestic demand). Resulting in a significant drain on the scarce foreign exchange reserves, thereby an emphasis by the government to promote local oilcrops production to levels of self-sufficiency (Development plan, 1989-1993). Coconut, one of the local oilcrops offers the greatest potential in contributing to increased vegetable oil production, yet its production has been declining over the years. The objective of the study was to analyze the existing coconut-based farming systems in the study area, identify farm level problems facing coconut farmers, suggest ways of easing the problems to improve production and determine the relative profitability of coconut-based intercrops. Farming systems analyses and gross margin analyses methodologies were used. The study revealed that, coconut producers used none or minimal levels of recommended coconut inputs resulting in low yields of 6-7 tons/ha compared to a potential of 17.5 tons/ha. Credit availability was a constraining factor for the purchase of recommended coconut inputs as reported by 90% of the farmers. Other constraints included, poor price structure for both nuts and copra which was as low as 35cts-ksh 3.00 and ksh 4.~0-Ksh 20.00 per kg respectively. Lack of an organized marketing system and timely market information further compounded the problem as reported by 70% of those interviewed. Insect damage caused by the rhinoceros beetle was observed by 70% of' the respondents and -ixresulted in yield losses, consequently low coconut production. Gross margin analyses revealed low returns for monocropped coconut holdings compared to coconut-based crop mixtures. The former had gross margins per acre of ksh 208, ksh 1,687 and ksh 842 for small, medium and aggregate farm model respectively compared to ksh 12,655, ksh 2,319 and ksh 12,655 for the most profitable coconut-based crop enterprises in the same farm model categories. The study recommended the allocation of funds for extension purposes for farmers' education and field demonstrations in coconut crop husbandry management, to improve the yields. The government should provide market information for coconut products to allow forces of supply and demand set the price. This study gives as a guideline the price of copra to be 10-25% of the break-even price, determined in the study as Ksh 24.60 per Kg. Prioritization of coconut production is recommended by improving farmers' accessibility to credit for coconut farm investment through provision of medium term loans by local financial institutions, improvement of input distribution, development of rural access roads and general infrastructure. Research be undertaken on rhinoceros beetle control, appropriate coconut intercrop mixtures and associated agronomic technologies with adequate and consistent information dissemination to farmers. Other studies should come up with the effect of the importation of coconut products, copra and oil, on the coconut industry and determine modalities of credit provision for coconut investment.