Department of Agricultural, Food, and Resource Economics Food Security Group

IDWP 112. Valerie Kelly, Duncan Boughton, and Benjamin Magen. 2011. Pathways to Improved Profitability and Sustainability of Cotton Cultivation at Farm Level in Africa: an Approach to Addressing Critical Knowledge Gaps

EXECUTIVE SUMMARY:
In 2009, the World Bank published a comparative study of cotton sector reforms, based on
detailed case studies carried out during 2007/08 in nine of Africa’s main cotton producing
countries. The purpose of the study was to draw practical insights from the diversity of
experiences in institutional reforms of cotton sectors and to better understand the strengths
and weaknesses of the different types of sectors operating in Africa, the likely effects of
specific types of policy change, and the possible ways forward.

One chapter of this World Bank study focused on cotton yields and returns, looking first at
international comparisons of lint yields per hectare and then at comparisons of performance
indicators among different types of farms in selected countries. Two conclusions emerged
from this work that motivated the research proposed in this paper:
     •Cotton yields in Africa lag behind those in other countries; and
     •Good performance in terms of cotton productivity and profitability seems to be limited
       to a relatively small subset of all cotton farmers.

The finding that only a small proportion of cotton farmers make profits is a serious concern,
with important implications for cotton development strategies in countries where poverty
reduction is a top priority. However, the data underlying the study’s farm-level analyses were
collected using a Participatory Rapid Appraisal (PRA) approach that provided descriptive
information on a limited, non-random sample of farmers. While some broad insights on
differences in farm characteristics and the profitability of cotton production for farmers
producing large, medium, small and very small amounts of cotton were obtained from the
PRA results, researchers agreed that there was a need to better quantify cotton profitability at
farm level. In addition to identifying the factors affecting profitability there is also a need to
identify, characterize, quantify, and understand the behavior and dynamics of different cotton
farm groups in order to develop appropriate policy recommendations and support programs to
help farmers – or different categories of farmers – benefit more from cotton cultivation.

This paper develops a concept note for additional research that would address the perceived
weaknesses of the earlier work. The underlying hypothesis of the proposed study is that
technology research, farmer training, and policy and institutional reforms to improve cotton
sector productivity and incomes tend to be designed for typical or model farmers. This often
fails to take into account the diversity among cotton farmers and what this diversity implies
for cotton sector development in general and the ability of the cotton sector to contribute to
poverty reduction in particular. The proposed research is expected to contribute to aggregate
growth in cotton productivity and incomes through the design of more targeted support
interventions based on a better understanding of the strategies, capacities, and constraints of
the different types of cotton farmers.