Forecasting yields, prices and net returns for main cereal crops in Tanzania as probability distributions: A multivariate empirical (MVE) approach

Maize (Zea mays L.), sorghum (Sorghum bicolor L. Moench) and rice (Oryza sativa) are essential staple crops to the livelihoods of many Tanzanians. But the future productivity of these crops is highly uncertain due to many factors including overdependence on rain-fed, poor agricultural practices and climate change and variability. Despite the multiple risks and constraints, it is vital to highlight the pathways of cereal production in the country. Understanding the pathways of cereals helps to inform policymakers, so they can make better decisions to improve the viability of the sector and its potential to increase food production and income for the majority population. In this study, we employ a Monte Carlo simulation approach to develop a multivariate empirical (MVE) distribution model to simulate stochastic variables for main cereal crops in Tanzania. Eleven years (2008–2018) of yields and prices data for maize, sorghum and rice were used in the model to simulate and forecast yields and prices in Dodoma and Morogoro regions of Tanzania for a seven-year period, from 2019 to 2025. Dodoma and Morogoro regions represent semi-arid and sub-humid agro-ecological zones, respectively. The simulated yields and prices were used with total costs and total area harvested for each crop to calculate the probable net present value (NPV) for each agro-ecological zone. The results on crop yield show a slightly increasing trend for all three crops in Dodoma region. Likewise, rice yield is expected to marginally increase in Morogoro with a decreasing trend for maize and sorghum, meanwhile, the prices for the three crops all are projected to increase for the two regions. Generally, the results on economic feasibility in terms of NPV revealed a high probability of success for all the crops in Dodoma despite a higher relative risk for rice. The results in Morogoro presented a high probability of success for rice and sorghum with maize indicating the highest relative risk, and a 2.41% probability of negative NPV. This study helps to better understand the outlook of the main cereal crop sub-sectors in two agro-ecological zones of Tanzania over the next seven years. With high dependence on rain-fed agriculture, production of main cereals in Tanzania are likely to face a high degree of risk and uncertainty threatening livelihoods, incomes and foo

An Economic Comparison between Alternative Rice Farming Systems in Tanzania Using a Monte Carlo Simulation Approach

Tanzania is the second-largest producer of rice (Oryza sativa) in Eastern, Central, and Southern Africa after Madagascar. Unfortunately, the sector has been performing poorly due to many constraints, including poor agricultural practices and climate variability. In addressing the challenge, the government is making substantial investments to speed the agriculture transformation into a more modernized, commercial, and highly productive and profitable sector. Our objective was to apply a Monte Carlo simulation approach to assess the economic feasibility of alternative rice farming systems operating in Tanzania while considering risk analysis for decision-makers with different risk preferences to make better management decisions. The rice farming systems in this study comprise rice farms using traditional practices and those using some or all of the recommended system of rice intensification (SRI) practices. The overall results show 2% and zero probability of net cash income (NCI) being negative for partial and full SRI adopters, respectively. Meanwhile, farmers using local and improved seeds have 66% and 60% probability of NCI being negative, correspondingly. Rice farms which applied fertilizers in addition to improved seeds have a 21% probability of negative returns. Additionally, net income for rice farms using local seeds was slightly worthwhile when the transaction made during the harvesting period compared to farms applied improved varieties due to a relatively high price for local seeds. These results help to inform policymakers and agencies promoting food security and eradication of poverty on the benefits of encouraging improved rice farming practices in the country. Despite climate variability, in Tanzania, it is still possible for rice farmers to increase food production and income through the application of improved technologies, particularly SRI management practices, which have shown a promising future.Peer Reviewe