Resource Use Efficiency in Soybean Production in Rwanda

Abstract

Even though soybean (Glycine Max) is currently a minor crop in Rwanda, it is one of the crops that the government of Rwanda is promoting because of its high nutritional value, adaptability to the climate of the country, and its good response to organic and mineral fertilizer inputs. Since farm resources are limited in Rwanda, it is critical to devise ways of improving their productivity and use efficiency even in soybean production. This study used on-farm data from Kamonyi district collected during two agricultural seasons from September 2007 to July 2008 and identified key factors determining soybean production and resource use efficiency in soybean production. Cobb-Douglas production function was fitted. Results indicate that, with an elasticity of 0.46, plot size was the most important factor of soybean production. It was closely followed by intermediate inputs (fertilizers, pesticides and seeds), with a coefficient of 0.44. When intermediate inputs were decomposed, fertilizers with an elasticity of 0.062 appears to contribute more to soybean production than pesticides (0.057) and seeds (0.034). Technical inefficiency was responsible for at least 93% of total variation in soybean output among the survey farmers. The relative efficiency (allocative efficiency) of resource use, expressed as the ratio of marginal value product (MVP) to marginal factor cost (MFC), were 1.73 for soybean plot size, 1.36 for fertilizers, and 1.92 for pesticides. These indicate that too little of these inputs are being used in relation to the prevailing market conditions.

Keywords: Soybean, Resource use, Efficiency, Cobb-Douglass production models, Rwanda