Analysis of optimal crop enterprise combination by small scale crop farmers in Kipkelion west, Kericho County, Kenya

Abstract

Optimal crop enterprise combination enables small scale farmers to earn the highest possible income under resource limiting conditions. Crop enterprise combination by small scale farmers in the study area has been sub-optimal and consequently, have been earning low annual gross margins, which is attributed to the knowledge gap in the nature of trade-offs made while making enterprise combination decisions. This paper examined the determinants of optimal crop enterprise combination by small scale farmers. The study was guided by the theory of the firm and descriptive and cross sectional research designs were adopted. The study drew a sample of 154 smallholder farmers through a stratified random sampling techniques. The primary data was collected using a structured interview schedule and analyzed using descriptive and Linear programming (LP). LP results revealed that the optimal crop combination was obtained when 0.82 and 0.87 hectares of maize and coffee are combined to give a gross margin of Kenya Shillings (KSh.) 241,810. The results further revealed that the total land and capital available for crop production was fully utilized under optimal crop enterprise combination while only 50% of available labour was utilized. Based on the results, this study recommend cultivation of 0.82 and 0.87 hectares of maize and coffee respectively to maximize farm incomes. Secondly there is need for policy makers both at national and county governments to formulate or review agricultural land use policies since land size under crops significantly affect optimal crop combination plan in the study area. Thirdly, there is need for small scale crop farmers to embrace intensive crop production technologies as land was found to be a limiting factor in crop production. Fourthly, the results on capital use imply that capital was a limiting factor of production in the study area. This study recommend that the financial institutions should provide agricultural credit that is tailored to maize and coffee production. Lastly, there is need to put in place measures by small scale farmers that would increase productivity and decrease TVC so as to increase GM. Such measures include use of high yielding crop varieties that are also resistant to pests and diseases.