Comparative evaluation of farm forestry enterprises versus maize cultivation in Western Kenya: the proceedings of 2nd KEFRI scientific conference

Abstract

According to classical economic theory, land use decisions are highly influenced by profit maximization strategies especially smallholder farmers in agricultural based economies. Western Kenya is endowed with diverse farm forestry enterprises whose economic potential are partially tested. The objective of the study was thus to evaluate financial competitiveness of selected farm forestry enterprises versus maize production, the dominant agricultural land use in Western Kenya. This was done through use of financial cost-benefits analysis techniques that allowed comparing profitability of replacing maize with four commonly practiced farm forestry enterprises: black wattle for charcoal production, pulpwood, polewood and sawlog. Three levels of maize technologies were selected based on land preparations and input applications (I, II and III). The study showed that farm forestry enterprises were financially viable and profitable within selected discount rates (0, 5%, 10%, 15% and 20%). However, most farm forestry enterprises were less profitable than higher maize management levels II and III. The results also showed that there were emerging markets for poles and other tree products from farms that has enabled farmers derive considerable incomes in shorter periods thus bridging the gap between costs and realization of benefit from growing trees on farm. It was also noted that there were significant increases in prices of forestry product as a result of logging ban slapped on Government forests. There are therefore good prospects for commercialization of profitable farm forestry enterprises in the region for specific market niches as part of wider diversification of on-farm incomes.