A COMPARATIVE ECONOMIC ANALYSIS OF TISSUE CULTURE BANANA PRODUCTION IN KARNATAKA Thesis submitted to the University of Agricultural Sciences, Dharwad In partial fulfillment of the requirements for the Degree of MASTER OF SCIENCE (AGRICULTURE) In AGRICULTURAL ECONOMICS By HANUMANTHARAYA M. R DEPARTMENT OF AGRICULTURAL ECONOMICS COLLEGE OF AGRICULTURE, DHARWAD UNIVERSITY OF AGRICULTURAL SCIENCES, DHARWAD – 580 005 JULY, 2007 ADVISORY COMMITTEE DHARWAD JULY, 2007 Approved by: Chairman : Members : 1. 2. (M. G. KERUTAGI) MAJOR ADVISOR (M. G. KERUTAGI) (B. L. PATIL) (BASAVARAJ B. BANAKAR) 3. (KANAMADI) CONTENTS

Sl. No. CERTIFICATE Chapter Particulars Page No. iii iv viii ix x 1 3 3 4 5 5 8 10 14 17 17 19 20 20 24 28 28 29 34 35 36 ACKNOWLEDGEMENT LIST OF TABLES LIST OF FIGURES LIST OF APPENDICES 1. INTRODUCTION 1. 1 Specific objectives 1. 2 Presentation of the study 1. 3 Limitations of the study 2. REVIEW OF LITERATURE 2. 1 Costs and returns in production of banana 2. 2 Resource use efficiency in banana production 2. 3 Marketing channels and marketing costs 2. 4 Problems in production and marketing of banana 3. METHODOLOGY 3. 1 Description of the study area 3. 2 Sampling procedure 3. 3 Nature and sources of data 3. Analytical tools and techniques employed 3. 5 Definition of terms and concepts used 4. RESULTS 4. 1 General characteristics of sample farmers 4. 2 Costs and returns in banana production 4. 3 Resource use efficiency in banana production 4. 4 Marketing channels and marketing costs 4. 5 Problems in production and marketing of banana 5. DISCUSSION 5. 1 General characteristics of sample farmers 5. 2 Costs and returns in sucker propagated and tissue culture banana production 5. 3 Resource use efficiency in sucker propagated and tissue culture banana production 38 38 38 43 45 46 49 56 5. 4 Marketing channels and marketing costs of banana 5. Problems in production and marketing of banana 6. SUMMARY AND POLICY IMPLICATIONS REFERENCES LIST OF TABLES Table No. 3. 1 3. 2 3. 3 4. 1 4. 2 4. 3 4. 4 4. 5 4. 6 4. 7 4. 8 4. 9 Title Land use pattern in the study area during 2004-05 Cropping pattern in sample taluks in the study area during 2004-05 Taluk wise area under banana in the year 2004-05 General characteristics of the sample farmers in the study area. Labour use pattern in banana production in Crop-I Labour use pattern in banana production in Crop-II Physical input use and yield pattern in banana production Cost of production of banana Yield pattern in banana production.

Return structure in banana production Cobb-Douglass production function estimates and MVP to MFC ratios in sucker banana production Cobb-Douglass production function estimates and MVP to MFC ratios in tissue culture banana production Page No. 4. 10 4. 11 4. 12 4. 13 Technical, allocative and economic efficiencies in banana Marketing costs incurred by the producer seller Production problems of banana growers in the study area. Marketing and financial problems of banana growers in the study area. LIST OF FIGURES Figure No. 1. 2. 3. 4. 5. 6.

Title Bullock use pattern in sucker and tissue culture banana in crop-I Labour use pattern in sucker and tissue culture banana in crop-I Human labour use pattern in sucker and tissue culture banana in crop-I Human labour pattrn in sucker and tissue culture banana in crop-II Total costs, total returns and net returns in sucker and tissue culture banana (crop-I) Total costs, total returns and net returns in sucker and tissue culture banana (crop-II) Page No. LIST OF APPENDICES Appendix No. I. IIa. IIb. Interview schedule Recommendations for tissue culture productions (Varity Grand Naine) banana Title Page No.

Recommendations for sucker propagated banana productions (Poovan/Sugandhi) 1. INTRODUCTION India has been a predominantly an agrarian economy since time immemorial. The developmental efforts over the last few decades have been doubtlessly strengthened our industrial base. However, agriculture continues to be the mainstay of our economy even today, as it contributes 21 per cent of national income and 67 per cent of the population still depends on it. The production of fruits and vegetables is of vital importance as it provides three to four times more cash income than cereals per unit of land.

Fruits and vegetables are the prime sources of vitamins and minerals without which human body can not maintain proper health. Indian Council of Medical Research has recommended the consumption of at least 92 grams of fruits per head per day and as much variety as the season permits. On the contrary, the per capita fruits consumption in India is only 46 g per day. There is a wide gap between use and requirement of fruits in general. Realizing the importance of horticultural crops, many farmers are directing their resources towards fruit crops.

Major fruit crops grown in India are mango, banana, citrus, Gauva, pineapple, grape, pomegranate and Ber. India has made a fairly good progress in production of fruits and vegetables with a total production of 418. 00 million tones in the year 2003-04, against 87. 10 million tonnes during 1991-92. Banana is the main fruit in international trade and the most popular one in the world. In terms of volume of export, banana stands first and ranks second after citrus fruit in terms of value. Banana (Musa accuminata L. ) belongs to the family Musaceae. It is one of the oldest fruits known to mankind.

Banana plants are the largest plants on earth without a woody stem. Banana is the most delicious fruit used as subsidiary food. It is consumed as table purpose as well as culinary fruit, its leaves are universally used for serving meals in South India and chopped banana stems are used as cattle feed. Some species of banana yield fibre, which is used for making ropes. The tip of inflorescence is cooked as a vegetable in some places. The plant is also used for decoration purpose in wedding, festivals and fairs. It is used as raw material in industries for preparation of banana powder, chips, juices and beer.

The juice of banana stem is used in making paper bond, tissue paper etc. The ripen banana fruit contains 70 per cent moisture, 27 per cent carbohydrates, 1. 20 per cent protein, 0. 09 per cent ash, 0. 50 per cent crude fibre and 0. 30 per cent fat. In addition to this, it also contains 290 ppm phosphorus, 120 ppm ascorbic acid, 80 ppm calcium, 7 ppm niacin, 6 ppm iron, 0. 5 ppm riboflavin and 0. 5 ppm thiamine. It also supplies 104 calories of energy. Bananas have no fat, cholesterol or sodium. Bananas are essential for athletic and fitness ctivity because they replenish necessary carbohydrates, glycogen and body fluids burned during exercise. Banana is grown throughout the year and is well within the reach of a common man, that’s why this fruit is called as “Poor man’s apple. ” Banana is not only the staple food of millions of people but also the most important commercial fruit crop of tropical region. Banana is a globally important fruit crop with 97. 5 million tones of production. According to the Food and Agriculture Organization (FAO) estimations, world total exports of banana accounted for 15. 9 million tonnes in 2004.

Banana is also a very important staple food for many developing countries for their food security. About 98 per cent of world’s production of banana is from developing countries. Developed countries are the usual importers of banana. The 10 major banana producing countries accounted for about 75 per cent of total banana production in 2004. India, Ecuador, Brazil and China contribute half of total banana production. India ranks first in area and production of banana in the world. It supports livelihood of million people, with total annual production of 11655. 9 thousand tones from 435. 0 thousand ha. with national average of 26. 0 tonnes per ha. during 2003-04 (Annonymous, 2006). Recognizing the importance of horticulture sector in the growth of Indian agriculture and with the objective of holistic growth of the horticulture sector, Government of India launched “National Horticulture Mission” in the year 2005. The horticulture sector includes fruits, vegetables, spices, medicinal & aromatic plants, flowers, plantation crops. Under this scheme, the Government of India has provided an outlay of Rs. 630 crores. in 2005-06, of which Karnataka state received Rs. 85. 21 crores. The benefits under the mission are extended to various horticultural crops.

The government provides an assistance of Rs. 15,000 per acre to expand acreage under banana cultivation. Maharashtra is the leading producer of banana followed by Tamil Nadu, Gujarat, Karnataka and Andhra Pradesh. These five states contribute more than 85 per cent of total banana production in the country. During 2003-04 area and production of banana in Karnataka were 50720 hectares and 1,23,7618 tonnes respectively with an average production of 69,618 tonnes per hectare Due to population expansion, higher purchasing power and development of new markets, demand for banana is increasing at a faster rate.

As a result of high demand and practice of replanting gardens once in 2-3 years, the demand for new planting material is increasing at a rapid rate. Most of the forms of banana are seedless, sterile and conventionally propagated by suckers. Even though natural rate of suckering is reasonably high (5-10 per year) most gardeners do not like to de sucker the plants for the purpose of providing planting material. Instead, the psuedo stem part of the sucker is cut away to regulate fruiting shoots. The traditional clonal propagation methods can not cope up with the continuous demand for new planting material.

Further, the fact that the sucker are carrying pathogens like bunchy top virus, nematodes and other pests which made them less attractive for using as planting material under intensive management. In this regard advances in biotechnology in the last few years especially in tissue culture production have made a great impact on the cultivation of banana crop. The propagation of plant by using plant part or group cell in a test tube under very controlled and aseptic conditions is called tissue culture.

Tissue culture banana production technology is a superior technology over traditional method (Sucker-propagated) of banana production with respect to optimal yield, uniformity, disease free planting material and true to type plants. Mass multiplication of tissue culture plants could be done in a short time. In recent years growing of tissue culture banana becoming popular in this area. In spite of the viable alternative for banana cultivation, there are problems in tissue culture banana viz. , high initial investment, somoclonal variation and disease spreading through tissue culture, etc.

Under these circumstances, it is essential to through a light on economics of tissue culture banana and comparing of tissue culture banana cultivation with traditional (sucker propagated) method of cultivation, so as to facilitate the farmers and others concerned in appropriate decision making for the cultivation of banana. Therefore, an attempt is made in present study to compare the performance of tissue culture banana production technology with traditional method of banana cultivation both from production and marketing angle. This type of study was not carried out in the study area previously.

Hence the present study is proposed with the following specific objectives. 1. 1 Specific objectives i) To estimate the costs and returns of tissue culture banana and sucker propagated banana. ii) To compare the resource use efficiency of tissue culture banana with sucker propagated banana. iii) To identify the marketing channels and marketing cost incurred by the producer. iv) To identify the problems encountered in production and marketing of banana. 1. 2 Presentation of the study The study has been presented in seven chapters as indicated below.

Chapter-I deals with the nature, importance and specific objectives of the study. Chapter-II describes comprehensively a review of the relevant research work done in the past related to the present study. Chapter-III outlines the features of the study area, sampling design followed, collection of relevant data and analytical tools used in the study. Chapter-IV is devoted to present the main findings of the study through Tables, graphs etc. Chapter-V discusses the results of the study. Chapter-VI provides summary and also suggests the policy implications based on the findings of the study.

At the end in Chapter-VII important references have been listed relating to the present study. 1. 3 Limitations of the study 1. Constraints on time and resources of the researcher forced him to select a cluster of four taluks for the study. Hence, results are largely applicable to those areas where similar conditions prevail. 2. The personal interview method of data collection requires the respondents to recall from their memories about cultural operations of banana cultivation. Hence, the findings may be subject to memory lapses of the study. 3. The average price realized during the study year was calculated and used in converting roduction figures from quantities to value terms, although the prices realized differ from farmer to farmer every year. 4. In the study area, the duration of banana crop was only two years because many farmers are not taking more than two crops. So the findings of the study permitted to only two year. 2. REVIEW OF LITERATURE A review of the research work done in the past relating to the present study has been presented in this chapter. The number of studies conducted in tissue culture banana were very few. Hence the reviews on economic analysis of sucker propagated banana were considered.

The review of literature is presented under the following sub heads. 2. 1 2. 2 2. 3 2. 4 Costs and returns of tissue culture banana and sucker propagated banana. Resource use efficiency in tissue culture banana and sucker propagated banana. Marketing channels and marketing costs. Problems in production and Marketing of banana. 2. 1 Costs and returns in production of banana Senthilathan and Srinivasan (1994), estimated the cost and returns of Poovan cultivar banana production in Thrichirapalli district of Tamil Nadu, over a period of three years. Total cost of cultivation per hectare was Rs. 1, 24,668. 1, with the gross income of Rs. 2, 86,913. 80 and there by the net income worked out to be Rs. 1, 62,235. 69 per hectare. The study clearly showed the high profitability of varity Poovan banana with a high benefit cost ratio 2. 3: 1 in the study area. Maurya et al. (1996) studied the profitability of banana production in Hajipur district of Bihar state, during 1993-94 based on sample of sixty banana growers selected from five villages in the district. The study revealed that, banana production was the most profitable crop production activity in the study area, as it provided a net income of Rs. 29,748. 5 per hectare with a total expenditure of Rs. 20,160. 70 and gross income of Rs. 49,958. 75. Dhakate (1996) studied the economics of banana production in Akola district of Maharashtra. The data was collected from 75 banana growing farmers through personal interview method. The average output per hectare was 40. 29 tonnes valued at Rs. 71,743. 32 per hectare, gross returns ranged from Rs. 69,894. 78 on large farms to Rs. 74, 521. 59 on small farms. Per hectare profit at cost ‘C’ for the sample as a whole was Rs. 19,533. 79 and it ranged from Rs. 17,685. 20 in large size group to Rs. 18, 557. 48 in small size group.

Sudarshan (1998) in the project conducted on an experimental farm in Bangalore reported that tissue culture banana had a world record of 6,900 plantlets per hectare. The tissue culture banana plantlets give very yields compared to sucker based plants of the same variety. Compared to average national yields per plant of 9 to 10 Kg (bunch weight) and average commercial banana produces yield per plant of 15 to 20 Kg in sucker based crop, the tissue cultured plantlets yield a bunch weight of 40 to 60 Kg per plant. The plantlets yield 175 tonnes as against 45 tonnes of conventional commercial sucker based banana horticulture in India.

The estimated revenue per crop of 11 months was Rs. 12. 5 lakhs per hectare could be obtained at a conservative price of Rs. 5 per Kg of banana. The revenues are further augmented by selling stem cores, which may fetch Rs. 3 to 5 per Kg at whole sale. The tissue culture daughter suckers can also be sold, which may fetch a price of Rs. 5 per sucker. More (1999) studied the economics of production marketing of banana in Marathawada region of Maharashtra state, he found that the cost of cultivation of banana per hectare was higher on small farms (Rs. 32,294. 72) compared to large farms (Rs. 76,610. 6) due to inefficiency in utilization of bullock labour, machine labour, human labour and manure and fertilizer in case of large farmers. The gross income per hectare was higher in large farmers (Rs. 1, 42,885. 30) compared to small farmers (Rs. 1, 40,696. 80) due to higher yields in large farmers. Qaim (1999) studied Socio-Economic impact of tissue culture technology in banana production in Kenya. The study revealed that, the cost of production of tissue culture banana was significantly higher (Increase in cost was 130% in small scale, 118% in medium scale and 92% in large scale growers) compare to banana production without tissue culture.

This was due to higher labor intensity besides the use of more inputs. Accordingly Yields and incomes obtained per hectare of banana were also higher (increase in yield was 150% in small scale, 132% in medium scale and 93% in large scale growers. Increase in income was 156% in small scale, 145% in medium scale growers and 106% in large sale growers) on these farms. The results also revealed that adoption of tissue culture could bring about substantial increase in yield for all the three types of farmers (small, medium and large).

In relative terms the potential gains are most pronounced for small farmers. Kameswara Rao (2000) compared economics of banana and sugarcane cultivation in Tungabhadra command area of Karnataka. The results revealed that, the per hectare total cost was higher in banana crop (Rs. 71,513. 04) than in sugarcane crop (Rs. 65,496. 12). The per hectare gross income and net income generated in banana cultivation were also higher (Rs. 1, 13,377. 57 and Rs. 41, 864. 53 respectively) as compared to sugarcane crop (Rs. 81,382. 74 and Rs. 15,886. 62) respectively.

The benefit cost ratio at cost ‘D’ was lower in sugarcane (1. 24) compared to banana cultivation (1. 59). Mishra et al (2000) conducted a study on production and marketing of banana in Gorakhpur district of Uttar Pradesh. The researchers estimated the total per hectare cost of production of banana on small, medium and large farmers at Rs. 36,281. 50, Rs. 37,820. 50 and Rs. 38,447. 50 respectively, with average cost of Rs. 37,516. 50 per hectare. The per hectare average gross returns were Rs. 71,133. 33, which was higher on large farms (Rs. 73,400) followed by medium farms (Rs. 2,250) and small farms (Rs. 67,750). The average input output ratio was 1: 1. 89. Anonymous (2000), the tissue culture banana crop cycle comprised of three crops in two years. The cost of cultivation of main crop per hectare was about Rs. 235,000 and second and third crops were Rs. 100,000 each. The expected return out of three crops was about Rs. 15. 0 lakhs per hectare and average returns per hectare of banana was Rs. 5. 0 lakhs and Rs. 7. 5. 0 lakhs per year. Stephen et al (2002) compared the socio-economic impact of tissue culture banana with non tissue culture banana in Kenya.

They found that, tissue culture banana production was relatively more capital intensive than sucker propagated banana production. However, tissue culture banana production was found to more profitable (yield from sucker propagated banana production was only 60% of that of yield from tissue culture banana production) compared to non sucker banana production. Shivanad (2002) in his study on performance of banana plantations in northern Karnataka, revealed that the establishment cost of banana plantations was Rs. 74, 759 per hectare, of which 50 per cent was spent on suckers and stalking.

The cultivation of sucker propagated banana was found profitable in northern Karnataka with a net profit of Rs. 85,266 per hectare per year. Guledgudda et al. , (2002) conducted study on economics of banana cultivation and its marketing in Haveri district of Karnataka, reported that the variable cost incurred by producer was Rs. 54,502. 81 per hectare which was accounted to 65 per cent of total cost. Among variable costs, the human labour was found to be the major item of cost, which accounted for 18 per cent. On an average farmers got 175 quintals of banana yield as main product valued at Rs. , 54,375 and farmers have realized Rs. 30,000 by selling suckers, the gross returns from banana cultivation were Rs. 1, 84,375 per hectare. The net returns realized by farmers were Rs. 1, 00,545. 96 with a B: C ratio of 2. 19. Mali et al (2003), in their study on economics of production and marketing of banana in Jalgaon district of Maharashtra. The worked out cost per hectare of banana cultivation was Rs. 1, 33,477. 36, the gross returns per hectare of banana at Rs. 2, 14,867. 24 and net returns at Rs. 6, 67, 61. 87. Florence Wambugu (2004), in the study, compared tissue culture and conventional banana.

The study revealed that, the average establishment cost per farm (0. 2 hectares) was US$ 200 in conventional banana and US$ 600 in tissue culture banana, average annual yield per farm was 5 tonnes in conventional banana and 10 tonnes in tissue culture banana. The average annual net profit per farm was US $ 600 in conventional banana and US$ 1800 in tissue culture banana. This means that there were more benefits of adopting the tissue culture technology compared with staying with the conventional bananas. Silva et al (2005) carried out a study in Brazil, to survey the potential of banana cv.

Apple cultivation in the region, as well as to determine the technical and economical indicators of two production systems, both using micro propagated and conventional seedlings. The results of economic analysis turned out to be quite satisfactory in this region for both production systems however the net income obtained from the utilization of micro propagated seedlings was 34 per cent higher than the one obtained from the conventional system Alagumani (2005) in the study on economic analysis of tissue- cultured banana and sucker-propagated banana in Theni district of Tamil Nadu, revealed that, per hectare cost was high in case of issue culture banana (Rs. 1, 41, 040) compared to sucker propagated banana (Rs. 1, 08, 294). The net income was also high in case of tissue culture banana (Rs. 1, 12, 262) compared to sucker propagated banana (Rs. 78, 855), clearly indicating the higher profitability of tissue culture banana production compared to sucker propagated banana production. Rane and Bagade (2006) studied economics of production and marketing of banana in Sindhudurg district of Maharashtra. The study revealed that the per hectare cost at cost C in Dodamarg and Sawantadi tahsil were Rs. 1. 52 lakhs and Rs. 1. 53 lakh respectively.

In Dodamarg tahsil banana was grown as a sole crop where per hectare cost of cultivation was Rs. 1. 28 lakh and in Sawantadi tahsil the per hectare cost was Rs. 1. 15 lakh. The benefit cost ratio in Dodamarg tahsil and Sawantadi tahsil were 2. 20 and 2. 33 respectively. The average benefit cost ratio of banana cultivation was 2. 27. 2. 2 Resource use efficiency in banana production Venkatesha Reddy (1982) employed Cobb-Douglas type of production function to examine the resource productivities and efficiency for planted and ratoon crops of Robusta and dwarf Cavendish varieties of banana separately.

The gross return was the dependent variable while land (hectare), Plant population (number), labours (man days), manures and fertilizers (Rupees) and plant protection chemicals (Rupees) were independent variables. The marketing channels were treated as dummy variables. The analysis indicated that 95 per cent variation in gross return was explained by above included independent variables. Thomas and Gupta (1987) studied the economics of banana cultivation in Kottayam district of Kerala. The Cobb-Douglas production function was used and the results showed increasing returns to scale.

The response of gross income to an increase in the expenditure on suckers, plant protection chemicals, propping materials, baskets, transportation and marketing was highly significant and positive, and the marginal value product of human labour, and manures and fertilizers were lesser than marginal input prices. The study revealed that the increase in suckers, plant protection chemicals, propping materials would generate a substantial level of additional income with a negative amount of additional expenditure.

Dhakate (1996), studied the resource use efficiency and functional analysis by using modified Cobb-douglas type of production function. Bullock and machinery labour , irrigation and maintenance charges , suckers and human labour charges were considered as independent variables and that of yield as dependent variable. The results thus indicated that the six variables included in the function explained about 15 per cent of variation in the output at overall level. In small, medium and large size groups, it was explained about 69, 29 and 29 per cent of variation in output respectively.

It was observed that in small size group manure and fertilizers influenced the yields significantly, while at overall level, human labour influenced the yields significantly. More (1999) studied the economics of production and marketing of banana in Maharashtra state. Cobb-douglas type of production function was used to determine the level of resource use efficiency for the banana crops of small, large and pooled farmers. The independent variables included in the function were land, human labour, machine labour, farm yard manure, nitrogen, potash, capital, irrigation and bullock labour.

The dependent variable was yield of banana. The coefficients of multiple determinations were 73, 67 and 85 per cent respectively for all the three categories of farmers. Land and capital were significantly influenced on yield in all the three categories of farmers and others were non-significant. The MVP to MFC ratios for land, phosphorus, capital and bullock labour in all the categories and human labour machine labour in large farmers category were more than unity, indicating that under-utilization of these resources.

Kameswara Rao (2000), study resource productivity of banana crop in Tungabhadra command area of Karnataka. Researcher employed Cobb-Douglas type of production function in which banana yield (tonnes) as dependent variable and Land (hectares), human labour (man days), bullock labour (pair days), suckers (tonnes), irrigation (numbers), and value of manures and fertilizers (Rs. ) as independent variables. The results revealed that the land was underutilized to the extent of 25. 35 per cent.

The regression coefficient of human labour for small labour was significant at 1 per cent level and the same was non significant for large and pooled farmers. The regression coefficient of irrigation for small and large farmers was significant at 5 per cent level. The regression coefficient for land, bullock labour, sucker and manures and fertilizers were non significant in all categories of farmers. The variation in banana production was explained by selected independent variables in small and large farmers group.

Shivanand (2002) studied the resource use efficiency of banana crop in northern Karnataka. He employed Cobb-Douglas type of production function, where banana yield as dependent and land, labour, FYM, bullock labour, fertilizers plant protection chemicals as independent variables. The study shown that land, labour and plant protection chemicals have significantly influenced the production of banana as indicated by their significant regression coefficients of 0. 672, 0. 472, and 0. 172 respectively in the study area. The MVP to MFC ratio were positive and more than one for land (7. 90), labour (5. 321) and FYM (1. 34) , where as it was less than one in case of fertilizers (0. 871), bullock labour (-401. 94) and plant protection chemicals (-2. 73). Yadav et al. , (2004) made comparative study of resource use efficiencies and resource productivities of traditional and tissue culture banana production in Maharashtra state. The regression co-efficient of area, FYM and potash were positive and significant at 10 per cent level, indicating, scope to increase level of those inputs to step up the productivity.

The sum of elasticities of production was equal to unity; reveal that constant returns to scale in traditional method of banana production. In tissue culture banana, the functional analysis revealed that, the regression co-efficient of plantlet was highly significant, there by indicating scope to increase the level of plantlet. The sum of elasticities of production was equal to unity showing constant returns to scale. MVP/ MFC ratio for inputs namely sucker nitrogen and bullock labour was greater than unity referring that efficient use of these resources.

Alagumani (2005) found that, in tissue-culture banana, the co-efficient of Plantlets, manures, and fertilizer were positive and significant at 1 per cent level. Labour cost had negative and non-significant influence on gross income. Sum of elasticities of resources shown that constant returns to scale. Where as in sucker-propagated banana the co-efficient of sucker and fertilizer costs were positive and significant at one per cent level. The sum of elasticities of resources shown that decreasing returns to scale. More et al (2006) studied on Labour tilization and input use pattern in banana cultivation in Maharashtra. Data were collected from 120 banana growers in Nanded and Parbhani districts determine the labour utilization and input use pattern (fertilizer and irrigation use) in banana cultivation. The study revealed that the major proportion of human labour was used for irrigating the banana crop. Hence, there is a need to encourage farmers to adopt the drip irrigation method, which is somewhat costly but labour-saving. 2. 3 Marketing channels and marketing costs

The marketing channels and marketing costs of banana produced by both the methods are dealt in similar way, because there is no difference found in the quality of output. Senthilnathan and Srinivasan (1994) identified the channels of banana marketing in Trichirapalli district of Tamil Nadu. Identified channels were Channel-I: Farmer > pre harvest contractor >Secondary wholesaler > retailer > consumer Channel-II: Farmer > pre harvest contractor > commission agent > wholesale > retailer > consumer. Channel-III: Regulated market wholesaler> retailer > consumer.

Channel-IV: Farmer > Regulated market secondary wholesaler> retailer > consumer. The study found that, channel-III was best among four channels. More (1999) in his study on economics of production and marketing of banana in Maharashtra state, researcher identified two major marketing channels in the study area through which bananas move from producer to consumer. They were Channel-II: Producer > commission agent cum wholesale > retailer > consumer. Channel-I: Producer > commission agent > distant markets. The marketing cost incurred by producer seller was Rs. 15. 17 per quintal of banana.

Kameswara Rao (2000) in the study on comparative economics of banana and sugarcane cultivation in Tungabhadra command area of Karnataka, identified two marketing channels in the study area, namely Channel-I: Producer> commission agents> Wholesaler> Retailer> Consumer Channel-II: Producer> Village level trader> Wholesaler> Retailer> Consumer. In Channel-I, the total marketing cost incurred by producer-seller was Rs. 23. 44 per quintal of banana. In Channel-II, the producer-seller has not borne any marketing cost. Mishra et al (2000) study on production and marketing of banana in Gorakhpur district of Uttar Pradesh.

The researchers identified that the small farmers were selling their produce to wholesalers (20% of produce), village trader (20%), pre harvest contractor (25%), direct sale local market (20%) and commission agent-cum –wholesaler (15%). Medium farmers sold their produce to the wholesalers (15%), village traders (20%), pre harvest contractors (25%), direct sale in local market (25%) and to the commission agents (20%). And large farmers sold their produce to wholesalers (10%), village trader (15%), Pre harvest contractor (25%), direct sale in local market (30%) and commission agent cum wholesalers (25%).

The marketing cost per quintal of banana produce incurred by the producer in fourth channel was Rs. 37. 50 (9. 87% of total marketing cost) and Rs. 24. 25 (6. 14%). Guledgudda et al. , (2002) conducted study on economics of banana cultivation and its marketing in Haveri district of Karnataka. The results of the study revealed that farmers in the study area followed three distinct marketing channels to sell their bananas. Those channels were Channel-I: Farmer > pre harvest contractor’s > commission agent > retailer > consumer. wholesale >

Channel-II: Farmer > commission agent > wholesale > retailer > consumer Channel-III: Farmer > retailer > consumer. Farmers have spent Rs. 1. 50 per bunch of banana marketing in channel-I, Rs. 2. 50 per bunch in channel- II and Rs. 10. 25 in case of channel-III. Shivanand (2002) in the study on performance of banana plantations in Northern Karnataka- An economic analysis, identified two major marketing channels namely, Channel-I: Producer> commission agent cum Wholesaler> Retailer> Consumer. Channel-II: Producer> Village level trader> Commission agent cum > Retailer> Consumer. Wholesaler

Among the two channels identified channel-I was found predominant over channel-II in marketing of banana in study area. On an average producer has incurred a marketing cost of Rs. 9. 50 in channel-I farmers has not incurred any marketing costs in channel-II. Stephen. et. al. , (2002) studied the Socio-economic impact of tissue culture banana compared with non tissue culture banana in Kenya, showed that the farmers primarily sell their bananas in the form to traders and other marketing intermediaries (popularly referred as BROKERS), either at farm gate or at their local trading centers.

Many of the produce buyers (brokers) come from major urban market centers. Depending on the distance from farm to nearest trading center, farmers pay between KShs. 10 and KShs. 30 per bunch of bananas plus between KShs. 20 and KShs. 50 each way as consumer fare and KShs. 10 per bunch as Cess by the local authority for selling at local trading centers. Hence it will costs between KShs. 50 and KShs. 100 to deliver and sell a bunch of bananas at local trading centers. Gajanana (2002) studied Marketing practices and post-harvest loss assessment of banana var Poovan in Tamil Nadu.

The study revealed the marketing practices of Poovan variety of banana in Trichy district of Tamil Nadu. Data on marketing practices were collected during March-April 2001 from the growers of Trichy and Lalgudi taluks of the study district. It can be inferred from the whole analysis that the farmers use value judgement by resorting to field sale to the agents of the distant market (Bangalore regulated market) wholesaler for getting higher price. A need is suggested to convert all unregulated markets like Trichy into regulated markets for the benefit of farmers throughout the country. Mali et al. (2003), studied economics of production and marketing of banana in Jalgaon district of Maharashtra. The marketing of banana in Jalgaon district is done through three marketing channels viz. , Delhi market through co-operative marketing societies, private traders through co-operative fruit sale societies and local merchants/group sale agencies. It was identified that the average per quintal marketing cost was Rs. 27. 55. It includes wages paid to labour for transportation from field to bund/road commission charges of market agencies and transportation charges of the produce from field to Railway station.

Vinod-Wanjari and Ladaniya (2004), Marketing costs, margins and important marketing channels for bananas, cv. ‘Basrai’ (Dwarf cavendish), were examined on the basis of data collected from growers, cooperative societies and intermediaries in selected districts of India (Jalgaon and Nagpur districts in Maharashtra, and Burhanpur district, Madhya Pradesh). Farmers sell their standing crop to pre-harvest contractors and also to cooperative societies and commission agents.

The net price received by the farmer is slightly less when produce is sold through a cooperative society since the society charges a higher commission than private commission agents. Transportation cost increased with distance between production area and market and this increased the marketing Ajay Verma and Singh (2004) survey identified common marketing channels in different states of the country were, In Pune and hazipur: Producer > wholesaler/commission agent >Retailer >Consumer Producer > trader> trade wholesaler >Retailer > Consumer. In Ranchi: Producer > distant market.

Producer > Retailer > Consumer Producer > wholesaler/commission agent > Retailer > Consumer In Guawahati: Producer > contract > trader > distant market. Producer > contractor > trader > wholesalers > Retailers. Producer > wholesaler or commission agent> Agent retailer. Bhubaneswar: Producer > trader > distant market. Producer > trader > wholesaler > Retailer. Siliguri Producer > wholesaler > distant market Producer > Wholesaler > Retailer. Producer > trader > wholesaler > Retailer. Sudha et al. , (2005) in the study on post harvest handling and marketing of banana in Rajahmundry region of Andhra Pradesh.

Two distinct marketing channels were identified they were channel-I, which is mainly a wholesale market sale, the producer themselves or through pre harvest contractors market the produce to the wholesalers. The produce is then sold to the traders then to retailers. The trader in turn transports a part of the produce to Hyderabad to merchants who specialized in catering to the specific demand for specific variety. The marketing costs for the sellers, who include the producers and field level buyers worked out to be 8. 16 per bunch when sold to wholesale markets. And farmers have spent Rs. 45. per bunch while self-marketing. Rane and Bagade (2006) studied economics of production and marketing of banana in Sindhudurg district of Maharashtra. The study reveals that the Channel –II i. e. Producer> City wholesaler> retailer> consumer is the major channel of banana marketing, and about 71 per cent of the produce is routed through this, Producer> village retailer retailer> consumer is the other major channel of banana marketing and about 29 per cent of total produce is routed through this channel. Total marketing cost per bunch of banana incurred by the producer in Dodamarg tahsil was Rs. 9. 79 Sawantwadi tahsil was Rs. 40. 33. The average cost per bunch of banana marketing incurred by the producer in Sindhdurg district was Rs. 50. 06. 2. 4 Problems in production and marketing of banana Senthilnathan, and Srinivasan (1994), estimated the cost and returns of Poovan cultivar banana production in Thrichirapalli district of Tamil Nadu. The study revealed that, in Trichy taluk twenty per of cent farmers expressed high initial investment, sixteen per cent farmers expressed that problem of heavy wind damage similarly twelve price fluctuations and ten disease problems.

In Lalgudi taluk seventeen high initial investment, eleven price fluctuation, thirteen disease incidence and nine wind damage. In Kulikathi taluk two disease incidence, eighteen wind damage and fourteen price fluctuations. Qaim (1999) studied Socio-Economic impact of Tissue Culture (TC) technology in banana production in Kenya. The study revealed that, due to high expenses for the technology itself and for complementary inputs, small farms were facing the most severe adoption constraints. More (1999) studied the economics of production marketing of banana in Marathawada region of Maharashtra state.

The study identified problems faced by the farmers that, all the farmers in the study area were facing the problem of Musa sercospora disease. The other major problems were high labour wages, non availability of quality planting materials at right time at reasonable price and non availability of adequate technical assistance from experts on behalf of government. The problems in marketing were spatial variation in the prices creating uncertainity among cultivatiors in choosing the markets for sale of produce. The higher transportation cost was also one of the major marketing problems in marketing of banana in the study area.

Inadequate availability of the loan at right time by the financial institutions was the main problem in the production of banana in the study area. Mishra et al. , (2000) in their study on production and marketing of banana in Gorakhpur district of Uttar Pradesh, identified problems faced by the farmers in the production and marketing of banana, unavailability of quality suckers and high cost of seed suckers, high cost of transportation, lower ruling price for produce due to unavailability of adequate storage facilities and weak finance structure.

The problem of poor supply of power electric power in critical period, unavailability of fertilizers and insecticides at reasonable prices. Kameswara Rao (2000) studied the problems of production and marketing of banana in Tungabhadra command area. The study revealed that, the major problems faced by the 85 per cent of the farmers was non availability of sufficient irrigation water. 73 per cent of farmers were opined that higher prices of fertilizers, 68 per cent of the farmers were facing the problem of non availability of quality planting material.

The other major problems in production of banana in study area were labour shortage in peak time, hazards of soil salinity, hail storms of heavy winds. The major financing problems in the study area were available loan was inadequate, high procedural complication of loan and high rate of interest. The major problems in marketing of banana in study area were high price fluctuations, high transportation cost, delayed payments on sale proceeds by the trader/businessman and high commission of intermediaries.

Begum and Raha (2002), studied on Marketing of banana in selected areas of Bangladesh. The existing marketing system for bananas in selected areas of Bogra district, Bangladesh, was examined, based on data from 40 market intermediaries. Also examined were the marketing costs and margins at different levels of banana marketing and the existing marketing constraints. Results revealed that banana marketing is a profitable venture and major marketing problems are price instability, lack of capital, inadequate facilities, and lack of adequate market information. Guledgudda et al. (2002) conducted study on economics of banana cultivation and its marketing in Haveri district of Karnataka. The study identified production problems like lack of technical know-how, scarcity of labour, pest and diseases, lack of adequate credit facility, and scarcity of water. The farmers in the study area expressed also marketing problems like involvement of intermediaries, lack of storage facilities and inadequate transportation. Stephen et al (2002) studied the Socio-economic impact of tissue culture banana compared with non tissue culture banana in Kenya.

The study revealed that the tissue culture banana producers appear to be constrained by capital for investment in irrigation facilities and acquisition of fertilizers or organic manures to produce good banana crop. Lack of organized marketing facilities makes exploitation of banana producers by traders/brokers fairly easily. Shivanad (2002) studied the performance of banana plantations in northern Karnataka. The study revealed as perceived by the farmers the major problems in cultivation of banana were severe incidence of Musa sercospora disease in all the districts of northern Karnataka, the disease lead to heavy crop losses.

Erratic onset of monsoon was another problem in Belgaum district affecting banana plantations. In Gulbarga district the non availability of labour and high labour wages and non availability of technical assistance for improved cultivation of banana possesses severe problem in production of banana. In marketing of banana farmers were facing delayed payments of sale proceeds, high cost of transportation of produce, wide price fluctuations and high commission charges as major problems. Mali et al. , (2003), studied economics of production and marketing of banana in Jalgaon district of Maharashtra.

The study identified that high cost of transportation, non availability of sufficient credit by the institutions in time, high price fluctuations, the problem of cheating in weighing of produce and lack of suitable grading of the produce according to quality as main problems in production and marketing. Alagumani (2005) in study on economic analysis of tissue- cultured banana and sucker-propagated banana, in Theni district of Tamil Nadu. The study revealed that, the risk in cultivation of banana using tissue culture plantlets was lower than that of sucker propagated banana production.

The constraints in tissue culture banana production were cost of tissue culture plantlets were very higher, and few farmers were also expressed problem of marketing of big size bunches obtained from tissue culture banana. Rane and Bagade (2006) studied economics of production and marketing of banana in Sindhudurg district of Maharashtra, the study reveals that farmers were facing the problem of disease i. e. bunchy top disease of banana and also farmers were facing the problem of pest i. e. aphids of banana in production of banana. 3. METHODOLOGY

This chapter outlines briefly the characteristics of the study area, the methods adopted in the selection of samples, the nature and sources of data and various statistical tools and techniques employed in analyzing the data under the following head lines. 3. 1 3. 2 3. 3 3. 4 3. 5 Description of the study area Sampling procedure Nature and sources of data Analytical tools and techniques employed Definition of terms and concepts used. 3. 1 Description of the study area Karnataka is the eighth largest state in India with an area of 190 lakh ha.

It is situated in between 11. 50 and 19. 00 N latitude and between 740 and 780 E longitude in the southern plateau. The state receives the average annual rainfall of about 1139 mm both from south west and north-east monsoon. The average temperature ranges from 21. 50 C to 31. 70C. The important crops grown in the state are jowar, ragi, maize and wheat among cereals; redgram, greengram, tur and bengalgram among pulses; groundnut, sunflower and safflower among oilseed crops and cotton, sugarcane and tobacco among commercial crops.

Study was conducted in Tungabhadra and Malaprabha command areas of NorthernKarnataka as higher area was concentratied under both sucker propagated and tissue culture methods of banana cultivation. Two taluks in each command area, namely Hospet and Gangavathi in Tungabhadra command area and Soudatti and Badami under Malaprabha command area were selected for study, based on area under banana cultivation under both the methods of banana production. 3. 1. 1 Description of the study taluks Demographic features of the sample taluks are narrated under the following sub heads. 3. 1. 1. Hospet taluk The taluk belongs to Bellary district, located in northern dry zone of Karnataka state. The geographical area of the taluk is 934 square kilometers with a total population of 3. 75 lakhs. The annual normal rainfall of the taluk is 604. 10 mm received from both the south west and north-west monsoon. The soil type of taluk is black. The temperature ranges between 30. 00C to 34. 00C. Paddy, Jowar, maize, pulses, and oil seeds are the major crops of this taluk. The varities selected for the study are Sugandhi (Musa AAB) and Grand Naine (Musa AAA). 3. 1. 1. 2 Gangavathi taluk

This taluk belongs to Koppal district, located in northern dry zone of Karnataka state. The geographical area of the taluk is 1328 square kilometers with a total population of 4. 063 lakhs. The annual normal rainfall of the taluk is 523. 2 mm received from both the south west and north-west monsoon. The soil type of taluk is black. The temperature ranges between 28. 00C and 30. 00C. Jowar, maize, pulses, oil seeds and banana are the major crops of this taluk. 3. 1. 1. 3 Soudatti taluk The taluk belongs to Belgaum district, located in northern dry zone of Karnataka state. The geographical area of the taluk is 1580. square kilometers with a total population of 3. 11693 lakhs. The annual normal rainfall of the taluk is 629. 1 mm received from both the south west and north-west monsoon. The major soil type of taluk is black. 0 0 temperature ranges from 20. 0 C to 28. 0 C. Paddy, Jowar, Maize, pulses, the major crops of this taluk. The and banana are 3. 1. 1. 4 Badami taluk The taluk belongs to Bagalkot district, located in northern dry zone of Karnataka state. The geographical area of the taluk is 1397 square kilometers with a total population of 2. 91 lakhs. The annual normal rainfall of the taluk is 578 with temperature ranges from 25. 00C 0 to 29. C. Major soil type of taluk is black. The major crops of this taluk are Jowar, maize, pulses, oil seeds, sugarcane and banana. 3. 1. 2 Land utilization pattern in the study area. 3. 1. 2. 1 Hospet taluk The land utilization pattern of Hospet taluk during the year 2004-05 is presented in Table 3. 1. Total geographical area of the taluk is 93,374 hectares of which 24,970 hectares is under forest, 14,935 hectares land is not available for cultivation, 7,110 hectares was under other uncultivable area, 4,820 hectare land was left fallow and only 41,539 hectares of land is under cultivation. 3. 1. 2. 2 Gangavathi taluk The Table 3. explains the total geographical area of Gangavathi taluk is 1, 32,131 hectares. In this 14,482 hectares of land is under forest, 12,331 hectares of land is not cultivated, 7,963 hectares is barren, 19,761 hectares was left fallow and net sown area of the taluk was 77,594 hectares. 3. 1. 2. 3 Soudatti taluk Land utilization pattern of Soudatti taluk during 2004-05 is mentioned in the Table 3. 1. The total geographical area of the taluk is 1,58,146 hectares of which 51 per cent of land is sown and remaining 49 per cent of land includes forest land, land which is not available for cultivation, other uncultivable area and fallow lands. . 1. 2. 4 Badami taluk Total geographical area of Badami taluk is 1, 39,420 hectares of which 22. 42 per cent (31,263 ha) was under forest, about 20 per cent (27,909 ha) fallow land, 47 per cent of land (65,630 ha) is sown and remaining land is not cultivable. The details of which are mentioned in the Table 3. 1. 3. 2 Sampling procedure Tungabhadra command area and Malaprabha command area of Karnataka state were purposively selected for undertaking the study due to higher area concentrated under both tissue culture and sucker propagated methods of banana cultivation. 3. 2. 1 Selection of the sample taluks

Banana was cultivated throughout the Tungabhadra command area and Malaprabha command area. However, as mentioned in Table. 3. 3. , the larger area under banana cultivation was in Hospet and Gangavathi taluks in Tungabhadra command area and Badami and Soudatti taluks in Malaprabha command area. Hence these four taluks were specifically selected for the study in the second stage. 3. 2. 2 Selection of sample villages and farmers. Based on the information obtained from the department of horticulture, five villages both sucker and tissue culture banana in each taluk were selected and thus total villages accounted to 20.

In each village two sucker banana growing farmers and two tissue culture Table 3. 1: Land use pattern in the study area during 2004-05 (Area in hectares) Sl. No. Classification of land Hospet 93,374. 00 (100. 0) 24,970. 00 (27. 00) available for 14,935. 00 (16. 00) 7,110. 00 (8. 00) 4,820. 00 (5. 00) 41,539. 00 (44. 00) Gangavathi 1,32,131. 00 (100. 0) 14,482. 00 (11. 00) 12,331. 00 (9. 00) 7,963. 00 (6. 00) 19,761. 00 (15. 00) 77,594. 00 (59. 00) Soudatti 1,58,146. 00 (100. 0) 13,432. 00 (8. 00) 10,704. 00 (7. 00) 5,030. 00 (3. 00) 48,035. 00 (30. 00) 80,945. 00 (51. 00) Badami 1,39,420. 00 (100. 0) 31,263. 00 (22. 42) 10,605. 0 (7. 61) 6,045. 00 (4. 34) 27,909. 00 (20. 02) 65,630. 00 (47. 07) Sample Taluks 1 Total Geographical area 2 Forest area 3 Land not cultivation 4 Other uncultivable area 5 Fallow land 6 Net area sown Figures in parentheses indicate percentage to total. Table 3. 2: Cropping pattern in sample taluks in the study area during 2004-05 (Hectares) Sl. No. 1 2 Crops Paddy Ragi Hospet 15338. 00 (25. 32) 58. 00 (0. 10) 7801. 00 (12. 88) 1401. 00 (2. 31) 6079. 00 (10. 03) 101. 00 (0. 17) 2060. 00 (3. 40) 900. 00 (1. 49) 594. 00 (0. 98) 1703. 00 (2. 81) 1993. 00 (3. 29) 4359. 00 (7. 20) Gangavathi 37356. 00 (40. 81) 0. 00 (0. 00) 8286. 00 (9. 5) 10069. 00 (11. 0) 679. 00 (0. 74) 349. 00 (0. 38) 3530. 00 (3. 86) 2708. 00 (2. 96) 1337. 00 (1. 46) 3106. 00 (3. 39) 2357. 00 (2. 58) 12839. 00 (14. 03) Soudatti 8. 00 (0. 01) 0. 00 (0. 00) 33447. 00 (32. 40) 1000. 00 (0. 97) 11003. 00 (10. 67) 13995. 00 (13. 57) 185. 00 (0. 18) 17731. 00 (17. 190) 266. 00 (0. 26) 0. 00 (0. 00) 4053. 00 (3. 93) 4669. 00 (4. 53) Badami 60. 00 (0. 06) 0. 00 (0. 00) 27512. 00 (28. 50) 7133. 00 (7. 40) 3755. 00 (3. 90) 1480. 00 (1. 54) 29. 00 (0. 03) 3389. 00 (3. 52) 285. 00 (0. 30) 2090. 00 (2. 17) 4683. 00 (4. 86) 17808. 00 (18. 48) 3 Jowar 4 Bajra 5 Maize 6 Wheat 7 Minor millets 8 Bengal gram 10 11 Redgram Other pulses Ground nut 12 Sunflower Figures in parentheses indicate percentage to total. Contd…… Sl. No. 13 Crops Other oil seeds Hospet 587. 00 (0. 97) 2221. 00 (3. 67) 624. 00 (1. 03) 4546. 00 (7. 50) 2943. 00 (4. 86) 0. 00 (0. 00) 7270. 00 (12. 0) 60578. 00 (100. 00) Gangavathi 4910. 00 (5. 36) 487. 00 (0. 53) 1069. 00 (1. 17) 10. 00 (0. 01) 2436. 00 (2. 66) 0. 00 (0. 00) 0. 00 (0. 00) 91528. 00 (100. 00) Soudatti 8174. 00 (7. 92) 327. 00 (0. 32) 3628. 00 (3. 52) 3185. 00 (3. 09) 960. 00 (0. 93) 19. 00 (0. 02) 511. 00 (0. 50) 103161. 00 (100. 00) Badami 1063. 00 (9. 10) 226. 00 (0. 23) 722. 00 (0. 75) 1746. 00 (1. 1) 266. 00 (0. 28) 0. 00 (0. 00) 24125. 00 (25. 03) 96372. 00 (100. 00) 14 Total fruits 15 Total Vegetables 16 Sugarcane 17 Cotton 18 Tobacco 19 Others 20 Total banana growing farmers were selected randomly. Totally four sample farmers were selected from each village and 20 sample farmers were selected from each taluk. Thus, totally 80 sample farmers were selected in which 40 were sucker banana growers and 40 tissue culture banana growers. 3. 3 Nature and sources of data In the present study, only primary data related to the agriculture year 2005-06 was collected from the selected banana growing farmers by personal interview method.

Majority of the respondents in the study area did not maintain records of expenditure and returns from banana cultivation. Hence, the data collected were based on memory of the respondents. The data collected was confined to fulfilling the objectives of the study from the selected cultivators. The data relating to some general information about the banana growers, cropping pattern, area under banana, details of various input-output pattern followed and problems, costs involved in marketing of banana by the farmers and problems involved in the production and marketing of banana were collected from the sample farmers.

The method of personal interview was adopted for data collection to ensure that the data collected from the respondents were relevant, comprehensive and reasonably correct and precise. Table 3. 3: Taluk wise area under banana in the year 2004-05 Sl. No. Taluks Area (ha) I. Tungabhadra command area 1 2 3 4 5 6 7 8 9 10 Koppala Gangavathi Sindhanur Manvi Devadurga Raichur Bellary Hospet Sandur Siraguppa 61. 00 620. 00 7. 00 17. 00 4. 00 18. 00 26. 00 235. 00 72. 00 11. 00 II. Malaprabha command area 11 12 13 14 15 16 17 18 19 20 Belgaum Bailaahongal Ramadurga Soudatti Badami Hubli Navalgund Gadag Naragund Rona 220. 0 37. 00 204. 72 293. 00 260. 00 35. 00 4. 00 110. 00 30. 00 44. 00 Source: Karnataka State Department of Horticulture, Lalbhag, Bangalore 3. 4 Analytical tools and techniques employed To study the specific objectives of the study, data collected were analyzed by using following statistical tools and techniques. 3. 4. 1 Tabular analysis. Tabular analysis was adopted to study characteristics of the sample farmers, determine the resource structure, cost structure, returns, profits and opinion of the farmers regarding problems of production, marketing etc.

Simple statistical tools like averages and percentages were used to interprete the results properly. 3. 4. 2 Functional analysis: To capture the ability of the farmer to achieve the maximum reliable crop output with given level of inputs under the existing situation and given technology, careful examination of farm specific technical efficiency and input specific allocative efficiency of the farms is necessary. Cobb-Douglas production function was used to study the technical and allocative efficiency.

The Cobb-Douglas production function analysis The Cobb-Douglas production function is the most widely used form of production functions for fitting agricultural production data, because of its mathematical properties like ease of interpretation and computational simplicity. The general form of the production function fitted was as follows. Y= a x1b1 x2b2 x3b3 x4b4 x5b5 eu Where, Y a. x1 x2 x3 x4 x5 e u = output of banana. (Tonnes/ha. ) = intercept. = number of suckers/plantlets used (Nos / ha. ) = quantity of FYM and fertilizer used (Rs. / ha. = quantity of plant protection chemicals used (Rs. / ha. ) = human labour (man days/ ha. ) = bullock labour (pair days/ ha. ) = error term. The function was translated into linear form by making logarithmic transformation of all the variables as follows. Ln Y = In a + b1 In X1 + b2 In X2 + b3 In X3 + b4 In X4 + b5 In X5 + lnu The CD function was estimated by using OLS method assuming the error term (u) to be randomly and normally distributed. The results of analysis were subjected to test by the coefficient of multiple determination and relevant ‘t’ test was carried out for each variable.

The regression coefficients ( bi ) were tested for their significance using ‘t’ test at choosen level of significance. t= bi Standard error of bi Estimation of marginal products and marginal value products In order to determine whether a particular resource is used optimally, the marginal value product and opportunity cost of one unit of that resource were compared. The marginal value product was obtained by multiplying the marginal product by the price of the product. Wherever the ratio of marginal value product to opportunity cost was more than unity, the resource was considered to be advantageously employed.

The marginal products were calculated at the geometric mean levels of variables by using following formula. Y Marginal product of input = bi X X Where, Y = Geometric mean of output X = Geometric mean of iih independent variable. bi = the regression coefficient of i independent variable. The marginal value product of each resource was calculated by multiplying the marginal product of the resource by the price of the product. The formula used for the purpose was as under Y Marginal value productivity of Xi = bi X X Py X Where, Py = Price of banana.

The comparison of ratios (MVP/MFC) for judging efficiencies are MVP/MFC > 1 indicating under use of resources MVP/MFC = 1 Optimum use of resources (allocative efficiency) ih MVP/MFC < 1 indicating excess use of resources. Farm specific input level is calculated by equating MVP of an input with its price. Measures of technical efficiency The Cobb – Douglas production function assumes that all techniques of production are identiacal across all farms and regions. It does not distinguish between technical efficiency and allocative efficiency.

Farrel (1957) introduced the idea of an absolute efficiency and instead, proposed that efficiency could be measured in a relative sense as a deviation from the best performance in a representative peer group. He also differentiated between technical inefficiency and allocative inefficiency. Technical efficiency arises when less than maximum output is obtained from a given bundle of resources and allocative arises when resources are used in proportion which does not lead to profit maximization. Allocative efficiency exists when resources are allocated within the farm according to market prices.

It is therefore suggested that within a static framework measures of technical efficiency retain as a measure of good achievement in a materialistic society (Russel and Young, 1963). The idea of frontier production function was built around the concept of efficiency as evidenced by Farrel (1957). He imposed a Cobb-Douglass specification on the frontier and computed an output based measure of efficiency. The approach adopted here is to specify a fixed parameter frontier amenable to statistical analysis.

It takes the general form. Y = F (x) e u e Preharvest contractor -> Wholesaler -> Retailer -> Consumer and Producer -> Village trader -> Wholesaler -> Retailer -> Consumer were identified. The Non availability of adequate labour, destruction of plants due to high wind, fluctuation in market prices, somoclonal variation and Erwinia wilt of banana were the major problems identified. Adoption of drip irrigation was suggested to save labour in banana cultivation. Dr. M. G. KERUTAGI