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Agricultural Diversification in Mali: the Case of the Cotton Zone of Koutiala

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AGRICULTURAL DIVERSIFICATION IN MALI: THE CASE OF THE COTTON ZONE OF KOUTIALA By Mariam Sako Thiam A THESIS Submitted to Michigan State University in partial fulfillment of the requirements for the degree of Agricultural, Food, and Resource Economics – Master of Science 2014 ABSTRACT AGRICULTURAL DIVERSIFICATION IN MALI: THE CASE OF THE COTTON ZONE OF KOUTIALA By Mariam Sako Thiam Cotton production plays a central role in the economy and the livelihood of cotton growers in the Koutiala area of Mali. Despite all the investment made in the cotton zones, the cotton farmers in Koutiala suffer substantially from uncertainties in the cotton subsector linked to prices, timely payment, and to the future structure of the industry. This study analyzes empirically how cotton growers with different agricultural characteristics coped with these uncertainties over the period 2006-2010. The data used in this study were collected during the survey that covered 150 households in the Koutiala area during three cropping seasons: 2006-07, 2008-09 and 2009- 10.The results show that despite income diversification among the households surveyed in Koutiala, agricultural production remains the main source of income. The findings also show that the farmers who continued to grow cotton during the three years of the survey and those who started producing cotton after year one diversified within the agricultural sector by producing more peanuts and cowpeas while the farmers who dropped out of cotton production after year one of the survey diversified toward non-farm activities such as commerce and self. We also found that the non-cotton growers are the poorest group of farmers, with less agricultural equipment and labor as well as less overall wealth, limiting their potential to invest in farm activities and start an off-farm business. ACKNOWLEDGMENTS I would like to express my sincere gratitude to those who helped and supported me in completing my Master’s program. I am particularly grateful to Pr. John Staatz, my major professor and thesis advisor, for his supervision, support and patience throughout my program. I would also like to express my special thanks to my guidance committee members, Pr. Valerie Kelly and Pr. Timothy J Vogelsang for their comments on my thesis, their support and advice. I would also like to say thank you to Dr. Abdoul Murekezi and my colleague Mr. Abdrahamane Berthe for providing me with important documents necessary to complete this thesis. I also express my thanks to the US Agency for International Development Mali mission, whose support, via the Food Security III Cooperative Agreement with Michigan State University (MSU), provided a graduate research assistantship that allowed me to undertake my studies at MSU and co-financed the research (along with the Bill and Melinda Gates foundation) that led to this thesis. Thank you also to my friends and colleagues in the AFRE department for their friendship and support. Last but not least, I am very grateful to my parents, Mahamadou Sako and Dienebou Sanogo as well as my sister Fatimata Sako, my brothers Lassana Sako, Sidiki Sako and my husband for their unconditional love, prayers and encouragements. I could not accomplish this achievement without them. iii TABLE OF CONTENTS LIST OF TABLES ......................................................................................................................... vi LIST OF FIGURES ..................................................................................................................... viii CHAPTER 1: INTRODUCTION AND PROBLEM STATEMENT ............................................. 1 1.1 Problem statement ................................................................................................................. 6 1.2. Objectives and organization of the thesis ............................................................................. 8 CHAPTER 2: CONCEPTUAL FRAMEWORK AND RESEARCH HYPOTHESES ................ 10 2.1. Factors affecting cotton production.................................................................................... 11 2.1.1. On-farm conditions affecting household decision-making ............................................. 11 2.1.2. Off-farm factors household decision-making ................................................................. 12 2.2. Hypotheses ......................................................................................................................... 13 CHAPTER 3: DATA .................................................................................................................... 15 CHAPTER 4: BACKGROUND INFORMATION ON THE AGRICULTURAL SECTOR IN THE KOUTIALA DISTRICT ...................................................................................................... 20 4.1 Physical environment of the Koutiala zone......................................................................... 20 4.1.1 Soil ................................................................................................................................... 22 4.2 Principal crops ..................................................................................................................... 22 4.3. Livestock ............................................................................................................................ 29 4.4. Land Tenure ....................................................................................................................... 30 4.5 Farmers’ responses to price regulation reforms in the Malian cotton zone ........................ 31 4.5.1 Brief overview of reforms in the Malian cotton sector .................................................... 31 4.5.2 The constraints farmers face that prevent them from responding to opportunities to substitute other crops for cotton ................................................................................................ 34 4.5.2.1 Peanuts .......................................................................................................................... 34 4.5.2.2 Cowpeas ........................................................................................................................ 35 4.5.2.3 Sesame ........................................................................................................................... 35 CHAPTER 5: DESCRIPTIVE ANALYSIS ................................................................................. 36 CHAPTER 6: ECONOMETRIC ANALYSIS.............................................................................. 54 6.1 Results ................................................................................................................................ 58 6.2. Discussion .......................................................................................................................... 61 CHAPTER 7: CONCLUSIONS ................................................................................................... 64 APPENDIX ................................................................................................................................... 67 iv REFERENCES ............................................................................................................................. 78 v LIST OF TABLES Table 1: Characteristics of Sample Villages in the Koutiala Zone ............................................... 17 Table 2: Rainfall in Koutiala (mm) over the period 2000-2010 ................................................... 19 Table 3 Evolution of the Area per Person in CMDT Sector of Koutiala 1988/2002 (ha/person) 31 Table 4: Description of Group Means for Different Characteristics of the Households .............. 39 Table 5: Agriculture Equipment (%) among sample households in Koutiala from 2006 to 2009 40 Table 6: Median Commodity Producers Price (FCFA/kg) ........................................................... 41 Table 7: Average Coarse Grain Production (kg) by Group per Household (hh) and Adult Equivalent (AE) 2006-09 .............................................................................................................. 43 Table 8: Average Coarse Grain Net Sales (kg) by Group per Household (hh) and Adult Equivalent (AE), 2006-09 ............................................................................................................. 44 Table 9: Average Household Production of Rice, Peanut, Cowpea, Cotton, Fonio, and Sesame (in kg) by Group, 2006-09 .................................................................................................................. 45 Table 10: Average Cultivated Land (ha) by Crop, Group and Year, 2006-09 ............................. 46 Table 11: Average Yield (kg/ha) by Crop, Group and Year; 2006-09 ......................................... 47 Table 12 Average Rainfall in Koutiala per Month in Millimeter May-October 2004-2010 ....... 48 Table 13: Total Income Share by Source ...................................................................................... 50 Table 14: Average Total Income (FCFA) by Group per Household (hh) and Adult Equivalent (AE) over the 2006-09 Period ....................................................................................................... 51 Table 15:Multinmial Probit Model Output Using The Study Data .............................................. 58 Table 16: Marginal Effects of Variables by Group 2-4 ................................................................ 59 Table 17: Total Number of Households per Group and Village ..................................................
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