Profitability Analysis of Community Based Seed Production of Malt barley and Chickpea in North Western Amhara Region, Ethiopia

Abstract

Formal seed enterprises in Ethiopia focus mainly on maize and bread wheat crops but ignore chickpea and malt barley so a community-based seed production scheme is currently underway in Ethiopia including in the study
areas. Therefore, this study was carried out to examine the profitability of the malt barley and chickpea community-based seed production scheme at six woredas in Ethiopia. Crop yield, price, and cost were collected using data recording sheets while quantitative data was collected by survey and personal observation using checklists. Descriptive statistics and the gross margin analysis method were used to determine the profitability of the community seed production. The results of the profit indicators of the study showed that community-based chickpea and malt barley seed production was a profitable business enterprise. Chickpea community-based seed production enterprises were likely to be more sensitive to yield reduction than to price fluctuations or reductions while that of malt barley responds the same for both price and yield. The gross margin analysis depicted that, community-based seed production participant farmers obtained a gross margin of 36,591.25 ETB/ha and 45,004.70 ETB/ha from chickpea and malt barley crops respectively. Moreover, a high benefit-cost ratio value of 4.21 and 3.71 was obtained for chickpea and malt barley respectively. Therefore, chickpea and malt barley community-based seed production scheme should be promoted to a wider scale to reach more farmers and unaddressed similar areas by the office of agriculture in collaboration with farmers’ cooperative unions, seed enterprises, and/or universities.