Grain Legumes and Green Manures for Soil Fertility in ... - cimmyt

incremental costs and benefits associated with
mucuna as a green manure technology.
The 'without' technology scenario was defined as
growing maize continuously for three years without
use of any soil fertility intervention, a practice that
has become common among many poor
smallholder farmers in Malawi and Zimbabwe. The
'with' technology deals with a mucuna-maize-maize
3-year crop rotation.
The incremental costs for using mucuna are
perceived to be different for farmers who are able to
fallow some portions of their field and those who
are not able to do so due to land constraint. For
those who fallow land, the incremental costs are
additional labour and seed costs associated with
growing mucuna. For farmers who have to forgo
maize production on the portion of their land
planted to mucuna in the investment year, the
incremental cost is the opportunity cost in terms of
value of forgone maize production. Benefits were
measured as the value of the incremental maize
grain yields in the subsequent two seasons which
was derived as the difference between continuously
cropped maize yields and the maize yield after
mucuna incorporation. To value the costs and
benefits of mucuna, 1999 market prices of inputs
and outputs in both countries were used (see
Appendix 2).
NPV
The. Net Present Value (NPV) was used to quantify
the net financial gains to farmers for investing in
mucuna. NPV is the djfference between the sum of
discounted benefits (incremental maize yields in
two seasons) and the sum of discounted costs (cost
of mucuna production/forgone maize grain
harvest). NPV is an absolute measure of the present
worth of an income stream accruing to the
individual farmers; which is what the farmers are
more interested in (Gittinger, 1982).
The NPV was calculated per one hectare unit of
land. If NPV is greater than zero it is worthwhile
investing in mucuna and if it is less than zero it is
not worthwhile investing in mucuna. The larger the
value of NPV· the higher the financial returns to
investing in mucuna.
Sensitivity and Risk Analysis
Sensitivity analysis shows to what extent the returns
(NPV) to investing in mucuna is influenced by
variations in the major quantifiable elemerits. This
is important for identifying those elements whose
changes have the largest impact on viability of the
technology. Monitoring and management of such
elements is critical in ensuring viability of the technology.
Grain legumes and Green Manures for Soil Fertilitv in Southern Africa
Risk analysis shows th~ probability out-comes af the
NPV derived from the changes in its elements. The
probability that the NPV would be negative can be
used as an indieator of the degree of risk in adopting
the technology.
Both sensi tivity and risk analysis were perfomied
using @RISK (a risk analysis software). @RISK uses
distribution functions instead of constant values
and can simulate 1000s of possible outcomes of
NPV. Because of a lack of historic data, triangular
distributions were used to estimate the distribution
functions of all the parameters used in computing
NPV (see Appendix 3).
In sensitivity analysis the regression and correlation
coefficients for the relationship between the changes
in NPVs and changes in the cost and benefit elements
are computed. The larger the regression coefficient
of an NPV element · the more important it is
in accounting for changes in the expected NPV. The
correlation coefficient simply shows the nature of
the relationship (positive or negative) between
changes in expected NPV and the element. In fisk
analysis, a cumulative distribution curve for the
simulated NVP outcomes is generated.
Results
Financial Incentives
For both farmers who fallow and those who can not
fallow, the NPVs in both Zirrlbabwe and Malawi are
positive, implying positive pays-offs .for investing in
mucuna for the two types of farmers (Table 1). The
NPV s are larger in Zimbabwe than in Malawi. This
means that there is less additional returns for
investing in mucuna in Malawi than in Zimbabwe,
largely explained by the much higher maize yield
responses to mucuna in Zimbabwe compared with
Malawi (see Appendix 1).
In Zimbabwe, investing into mucuna yields higher
returns (NPV) to farmers who forgo maize
production than for those who fallow their lands
(Table 1). The difference between NPVs for the two
types of farmer is accounted for by the difference in
Table 1. NPVs hal for investing,in Mucuna as agreen manure
(US Dollars)
Zimbabwe
Malawi
(Discounting at 50%) (Discounting .at 34%)
(in US$) Non· Fallowing Non· Fallowing
Fallowing farmers fallowing farmers
farmers
farmers
Total costs 37.11 57.46 56.64 50.76
Total benefits 189.88 189.88 7a.ll 70.11
NPV 152.77 132.42 13.48 19.35
Source: calculated by authors from on·farm trial data
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