Technical Efficiency of Growing Sugarcane Crop in Khyber Pakhtunkhwa, Pakistan

In this study technical efficiency of sugarcane crop at province level was analyzed. A total of 299 sugarcane growers were interviewed in three main sugarcane growing districts (D.I. Khan, Malakand and Charsadda) of Khyber Pakhtunkhwa (KP). Through a structured questionnaire, key questions were asked to gather data with respect to inputs utilization and socio-economic characteristics of selected sample of sugarcane growers. Using Stochastic Frontier Approach (SFA), mean technical efficiency of sugarcane crop in KP was around 70 percent ranging from minimum 53 to maximum possible efficient level of 98 percent. Results of study indicate that on average with same technology and resource base, yield of sugarcane can be increased by about 28% in order to reach the efficient fellow growers of sugarcane crop. Around 48.49% of the selected growers were below the mean technical efficiency level. Results from efficiency analysis show that age and off-farm income are quite influential socio-economic factors that affect technical efficiency of sugarcane growers in the study area. On inputs side farm size, labor, seed rate, tractor hours, irrigation and urea were found statistically significant. Therefore, based on findings, it is recommended that in order to encourage growers to apply optimal amount of these inputs and avoid uncertainty in returns, an effective system need to be put in place where cost of production might be considered while fixing sugarcane price. Also, there is need to keep experienced farmers involved in sugarcane production, because of positive relationship between grower’s experience and technical efficiency.