A COST BENEFIT ANALYSIS OF MAIZE PRODUCTION AND MARKETING IN UGANDA

Glenn Jenkins () and Leonard Leung ()
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Leonard Leung: Department of Economics, Queen's University, Kingston, Canada

No 2012-04, Development Discussion Papers from JDI Executive Programs

Abstract: Maize is important in Uganda because of its dual function both as an income-generating cash crop and as a staple crop that improves food security. Three interventions on the maize sector are selected for a substantive cost-benefit analysis investigation, namely: 1. "Increasing the utilization of commercial inputs"- the focus of the intervention is to overcome the low maize yield situation in Uganda. The purpose of this study is to determine if financial and economic conditions allow the maize farmers to acquire and properly apply the commercial inputs. 2. "Maize storage"- Absence of adequate storage facilities forces majority of farmers to store maize at home resulting on 22 percent post-harvest loss of the commodity. This study explores the merits of sponsoring the expansion of the network of community warehouses for maize storage. The levelized cost of the investments required per kg of maize stored over the life of the facility is computed to approximate the charge required to amortize the initial investment costs of the facility over the project's lifetime. 3. "The expansion of the P4P initiative" – The objective of P4P intervention is to improve the market linkages of farmers so that they can obtain higher prices for their production. The analysis shows that the increasing maize production intervention is promising for the agriculture sector and for the country. The "Maize Storage" intervention yields benefits to the farmers and other participants in the maize value chain. The analysis of P4P intervention shows that in the long-run this intervention is likely to damage the private sector trading and marketing institutions of the country.

Keywords: cost-benefit analysis; investment appraisal; stakeholder analysis; maize value chain; marketing; Uganda (search for similar items in EconPapers)
JEL-codes: D13 D31 D61 D62 E23 H42 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2013-01
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