Proceedings of the Fifth Asian Regional Maize Workshop - Search ...

associated with adopting the latest hybrid may be as low as 8-15~.
Table 9. Yields of hybrids and local maize in on-farm demonstrations without fertilizer
application in Malawi, 1990-92.
Normal Drought All
years year years
Number of sites 110 102 212
Yield of local variety (kg/ha)* 950 385 678
Yield of hybrid (kg/ha)* 1,409 680 1,058
Yield advantage of hybrid (kg/ha)** 459 295 380
Yield advantage of hybrid (~) (48) (77) (56)
SOUrce: Byerlee and Heisey (1993).
* Yield in unfertilized plots.
** Yield increase of 150 kg/ha required to cover the additional cost of hybrid seed.
Although it is Widely believed that the yield advantage of hybrids will be expressed
only with good management, plentiful water, and high levels of purchased inputs (especially
fertilizer), recent evidence suggests that hybrids can be profitable even in marginal
environments and under low management. Given the paucity of on-farm studies, it is
difficult to draw firm conclusions about the conditions under which hybrids are likely to
outperform farmer's current materials. Clearly there is a need for more extensive testing
of hybrids under farmers' conditions in order to assess their yield advantage at the farm
level.
In comparing the performance of hybrids to those of the farmers' current material, it
is important to keep in mind that the criteria used by farmers to measure performance may
differ from those of researchers. For example, farmers usually think of grain yields in
terms of net yields, i.e., after deducting processing and storage losses. In some cases,
processing and storage losses in hybrids have been sufficiently large to offset advantages
of ~ or more in gross grain yields (Smale et al., 1991). When maize is produced for the
market, quality differences reflected in price discounts must also be taken into account
when estimating the yield advantage of hybrids. Price discounts applied to hybrids because
of undesirable characteristics having to do with grain texture, grain color, storage
quality, difficulty of processing, or eating quality may fail to compensate farmers for a
simple yield advantage.
3.4. Cost of capital and risk
To be attractive to farmers, hybrid maize must not only generate additional income
sufficient to repay the higher cost of the seed, but it must also provide an extra return
to compensate the farmer for the risk taken in planting an unfamiliar material. Smallscale
farmers, particularly those who rely on their own production for an important share
of household consumption needs, often place a high value on food security. Studies have
found that a marginal return of at least 1~ often is needed to make investment in a new
technology attractive to farmers, meaning that for every dollar (or peso or rupee)
invested in seed, the new technology will have to generate at least two dollars (or pesos
or rupees) in additional profits. Some seed companies figure on a much higher marginal
return of at least 30~ in setting prices for hybrid seed (McMullen, 1987). under such a
pricing strategy, at least three quarters of the additional benefits associated with the
new hybrid are captured by farmers.
Table 10 illustrates how partial budget analysis can be used to compute the marginal
rate of return (MAR) associated with the adoption of hybrid maize. Two scenarios are
depicted: 1) a case in which the hybrid replaces an unimproved local variety, and 2) a
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