Profitability Gap Analysis of Sweetpotato Production in Ghana: Evidence from Sweetpotato Farmers and Traders

Abstract

Aims: To assess the profitability gap between farmers and traders in sweetpotato production. Study Design: Purposive Sampling of Sweetpotato producers and traders. Place and Duration of Study: Four major sweetpotato growing regions (Volta, Upper East, Central and Eastern) in Ghana for the 2012/2013 planting season. Methodology: One district was purposively selected from each region (Akatsi, Bawku, Twifo, Kwahu East) based on output levels. 3 communities were randomly selected from a pool of sweetpotato growing districts in each of the districts. 10 farmers were purposively selected from each of the 3 communities hence for every region 30 farmers were selected. For the traders, 5 traders were selected from each community hence 15 traders were selected from every region. In sum, 120 farmers and 60 traders were sampled across the study areas. Gross Margin Analysis was employed in the determination of profitability and formed the bases for the profitability gap discussion. Results: With a total production cost per hectare of  2,452 Ghana cedis ($580.36), labour accounted for about 39% of the operational cost for farmer’s and farmer’s net returns on investment stood at 1,647 Ghana cedis ($389.82). The trader’s total cost was 4,429 Ghana cedis ($1,048.29) and with a net return of 4,841 Ghana cedis ($1145.80). Farmers had a “net return per cedi” of 1.67 Ghana cedis ($0.40) whereas the trader had 2.09 Ghana cedis ($0.49).  Conclusion: Sweetpotato production and trade is profitable. A significant gap exist between traders profit and that of the farmers in favour of the traders. It is recommended farmers form cooperatives and be functional on Innovation Platforms to have bargaining power for better prices and access to inputs at affordable cost; be trained on standardizing produce and processing to add value; extension information access should be modernized using modern telecommunication tools and tailored to the local and unique needs of the smallholder farmer.