INVESTIGATING THE EFFECT OF OUTGROWER SCHEME ON SUGARCANE PRODUCTION AND OUTGROWERS’ LIVELIHOODS WITH MECHANIZATION PERSPECTIVE: A CASE OF WONJI SHOA SUGAR ESTATE

Abstract

Sugarcane is an important crop worldwide due to its nutritional and economic uses. The Ethiopian government developed a path way to prosperity and strategy for ten years to boost agricultural productions. From the agricultural sectors, sugarcane production through developing new land expansion of the existing sugarcane production estate farms were more emphasized. To achieve this goal, enormous sugarcane production strategies were undertaken without showing concrete evidence as to their benefits or detriments to the welfare of Wonji adjacent area outgrowers. Therefore, the objective of the study was to investigate the effect of the outgrower scheme with the mechanized farming system on sugarcane production and outgrowers' livelihoods in the case of Wonji Shoa Sugar Estate. Data were collected through pre-tested survey questionnaires administered to 332, sampled outgrowers that were randomly selected and involved in a cross-sectional survey design. Descriptive statistics and chi-square test were used to describe and analyze the data using the SPSS statistics software version 24. The survey result showed that the overall perception of the respondents on the implementation of the scheme was unfavorable with a weighted mean index of ‘2.31’ on considered 28 variables. The engagement of households in the outgrower scheme was not voluntarily, in which 63.94% were engaged by government enforcement, while 36.06% by their interest. As a result, 64.76% of the sampled respondents indicated that they did not actively participate in the scheme on their land. Only 10.94% of the sampled respondents participated in decisions-making. Also, the outgrower scheme achieved on average, significantly higher productivity than the estate’s sugarcane plantations. On the other hand, the average annual net income of the participants in the scheme that was generated from sugarcane production was smaller than the average annual income generated from cultivating of teff, maize, and wheat per hectare. Moreover, mechanization of sugarcane cultivation having yet been paid attention to planting and harvesting activities. Presently, 93% of the respondents did not support the scheme in the future long plan. Generally, the study highlighted that the scheme has had negative impacts on the income and livelihoods of outgrowers. Based on the finding, the researcher suggest that the scheme representatives should solve the problems identified by the survey in a sustainable way.