Analysis of Comparative advantage of Irrigated Wheat vs Onion production in East Shewa Zone, Oromia

Abstract

To alleviate poverty the government of Ethiopia has initiated wheat self-sufficiency strategies through increasing wheat productivity in the rain-fed agro-ecologies and expansion of production to the irrigable lowland areas using cluster approaches. This study was conducted in Dugda Woreda, East Shewa zone of Oromia region with objective of identifying comparative advantage of onion and irrigated wheat production. Both primary and secondary sources were used for data collection. The primary data was collected through interviewing from 100 sample households using semi-structured questionnaires. Qualitative data was collected through focus group discussions, and key informants interviews using checklists. STATA version 15 Software was used for data analyzing. As the descriptive result of the study indicate that, on average, sample household owned livestock of 6.35 TLU, farmers general farm and wheat farming experience of were about 23.15 and 13.25 years respectively, having the onion farming experience of 5.94 years. This implies that the producers can increase the efficiency as their experience increase since they were work age groups. As the study result confirm that farmers in the study area hold a mean of 1.44 ha of cultivated land in the survey year from which they allocate 1.04 and 0.40 ha for irrigated wheat and onion, respectively with the productivity of 280 qt for onion and 40qt for irrigated wheat. The average total variable cost for onion and irrigated wheat production were 728,180 ETB and 130,280 ETB/ha, respectively. The net profit gained from onion and irrigated wheat production per hectare was 951,820 ETB and 89,720 ETB, respectively which is very high for onion production but very low for irrigated wheat production. The Benefit-Cost Ratio for onion production was 2.307 whereas its 1.688 for irrigated wheat production suggesting the benefit gained from one (1) birr expenditure is 2.307 birr for onion production. Therefore, comparatively producing onion is better than producing wheat by irrigation. Therefore, a compensations is needed from government for smallholder farmers if irrigated wheat have to be produced for export of wheat. In the mean-time Government should produce irrigated wheat based on farmers willingness and as crop rotation in the study area and Irrigated wheat should be applied for famers that unable to produce onions and where production cycle twice a year as crop rotation. In general for more conformation detail research is needed for policy option in this study topic. In the mean-time a new variety of wheat which cannot be attacked by Quelea bird (Girrisa) should be developed by any concerned body.