Crop Production/Industries, Productivity Analysis, Downloads July 2008 - June 2009: 10,

Crawford, Eric W.

Diagana, Bocar N.

Gaye, Matar

Kelley, Valerie A.

Reardon, Thomas

English

Research Papers in Economics

Page 1
POLICY SYNTHESIS
for USAID - Bureau for Africa
Office of Sustainable Development
Number 7 January 1996 
CASH CROP AND FOODGRAIN PRODUCTIVITY IN SENEGAL:
Historical View, New Survey Evidence, and Policy Implications
By
Valerie Kelly, Bocar Diagana, Thomas Reardon, Matar Gaye, Eric Crawford *
Food Security II Cooperative Agreement between U.S. Agency for International Development, Global Bureau, Economic Growth Center, Office of
Agriculture and Food Security and Department of Agricultural Economics, Michigan State University
BACKGROUND:  Up to the end of the 1970s, 2.   Crop research has helped maintain produc-
Senegal was in the forefront of African agri- tivity  despite  declining  rainfall;
cultural innovation and development.  The early
introduction of peanut cash cropping fostered the
rapid adoption of animal traction and one of the
highest fertilizer use rates in West Africa.  By the
end of the 1970s, however, the agricultural sector
was in decline and producing huge government
deficits.  Despite more than a decade of structural
adjustment, agricultural productivity growth
trends from 1960 to the present were stagnant. 
OBJECTIVES: The objectives of this research
are to: review the evolution of Senegalese agricul-
tural policy and its impact on cropping produc-
tivity; describe current production practices in the
Senegalese Peanut Basin, identifying factors that
now contribute to or constrain productivity
growth; and offer recommendations for policy
initiatives likely to improve productivity.
FINDINGS:   Three major types of findings, with
policy implications and recommendations, were
drawn from this research. 
I. Lessons from History
1. Agricultural intensification and productivity
growth are driven by cash crops with reliable
markets and predictable prices; 
3.   Liberalization has improved cereal marketing
efficiency;  but  the production impact has been
small as peanuts still provide more predictable
markets and profits;
4.   Vertical integration of extension, input dis-
tribution, credit, and output marketing systems
serves geographically dispersed smallholders well,
encouraging agricultural intensification more than
today's less integrated systems;
5.   Vertically integrated systems can become
costly and inefficient, particularly if management
responds more to political pressure than to
business logic;
6.   A lack of attention to rural literacy, exten-
sion, and farm-level financial analysis has
fostered the adoption of technologies such as
animal traction and fertilizer that farmers are now
having difficulty sustaining;  
7.   Senegal's failure to monitor relevant econo-
mic indicators during the 1960s and 1970s
increased the severity of the economic crisis that
brought structural adjustment to the forefront in
the 1980s. 
FS II Policy Synthesis No. 7 
Page 2
II. Current Input Use Patterns and Constraints.
Farmers are unanimous that the most
important constraint is their inability to obtain
desired quantities of peanut seed.  Inadequate inadequate cash reserves and poor access to
seed has led to lower peanut income and
diminished  capacity to purchase productivity-
enhancing inputs:  ageing animal traction equip-
ment is not being replaced, fertilizer use has
become virtually nonexistent, organic matter III. Economic Efficiency and Factors Associ-
returned to the soil is far from adequate, use of ated with Higher Levels of Productivity.
certified seed is extremely rare, as is use of
chemical inputs to protect seed quality or fight
pests.  Family labor is under-utilized during slack
periods while wage laborers are rarely hired
during peak periods.  The key strategies now
used by farmers to increase yields and/or
incomes are strategies that cannot be sustained
in the long-run: 1)  extensification on marginal
lands;  2) increasing peanut seeding rates to
compensate for declining soil quality; 3)
increasing the quantity (but not necessarily the
quality) of labor.
Farmers' perceptions of constraints on use of
productivity-enhancing inputs vary by input:
1) Fertilizer is considered too expensive; 2)
Fungicide yield potential is poorly understood; 3)
Insecticides on stored seeds make the seeds
inedible; 4) Poorly functioning markets limit
access to hired labor; 5) Peanut seed constraints
make it difficult to provide traditional in-kind
payments to seasonal laborers (navétanes); 6)
Yield  potential of certified seed is poorly
understood; 7) Reduced pasture near villages
limits manure availability; 8) Multiple uses of
crop residues reduce availability of soil organic
matter; 9) Credit programs do not allow for
flexible repayment schedules required by farmers
producing in risky environments.
Two important objectives for the peanut sector
are:
1. to maintain peanut production at a level which
keeps the processing industry running at capacity;
2. to increase farm incomes.  
Farmers' inability to obtain desired quantities of
peanut seed prevents attainment of both these
objectives.  Although the seed marketing and dis-
tribution system could be improved, farmers'
credit are the principal bottlenecks — at
present, there is  more of  a demand-side than a
supply-side problem.  
Although economic efficiency of current produc-
tion practices varies by farm type and agroclimatic
zone, two findings apply for almost all situations: 
1.  If farmers continue to cultivate without ferti-
lizer, the primary means of increasing yields and
profits is to increase seeding rates beyond the
current level (which already exceeds recommended
rates);
2.  The marginal value product of household labor
is less than the prevailing wage rate suggesting
that more labor than necessary is being used
during most of the cropping season. 
Input use patterns, adequacy of caloric intake,
location, and  access to cash are the principal
factors that differentiate high productivity
farms from others.
Farms located in zones with better soils and rains
tend to have better yields; there are, however,
notable exceptions:
1.  Cereal yields in the southeastern Peanut Basin
were significantly lower than those in less favor-
able zones; and
2.  Peanut yields in the drier northern and central
zones were not statistically different from those in
the higher rainfall zones. 
Failure to control crop disease appears to have
caused low cereal yields in the southeast.  We
attribute the latter result to the successful develop-
ment and extension of shorter-cycle peanuts that
are well-adapted to conditions in the drier zones. 
FS II Policy Synthesis No. 7 
Page 3
Had these varieties not been developed, more We believe the most urgent issues to address are:
than half the Peanut Basin would no longer be
producing peanuts.  
Farms with the best peanut yields have better
access to cash at planting time.  This access comes
from a combination of higher overall incomes,
larger prior-year peanut harvests, more livestock
which can be easily converted to cash, and better
access to credit.
Although there is evidence that noncropping
income improves food security and is re-
invested in cropping activities, we were unable
to establish a clear link between high shares of
noncropping income and better cropping pro-
ductivity.
POLICY IMPLICATIONS AND RECOM-
MENDATIONS:  Senegal needs to encourage
farmers to move from the present pattern of
increasing yields by mining the soil to an
agriculture based on more intensive pro-
duction technologies that conserve the natural
resource base while increasing returns to land
and labor.  The recent devaluation of the CFA
franc has improved the profitability of export
crops such as peanuts and increased demand for
local cereals, yet there is little evidence that
farmers are moving toward the type of agri-
cultural intensification needed to meet
Senegal's  long-run income and food security
goals.  
As this type of intensification is not only in the
long-run interests of farmers but also in the long-
run interests of the entire nation, farmers cannot
be expected to carry the full financial burden of
the transformation.  The government has an
important role to play in fostering policies and
public investments that will induce private farmers
and other business persons to invest in the
production, marketing, and use of more intensive
yet sustainable agricultural production
technologies.  In the absence of this enabling
environment, there is little hope for improving
productivity.  
1)  the quality and quantity of peanut seed
available to farmers; 2)  restoring soil fertility; 3)
renewing animal traction stocks; 4)  land tenure
legislation; 5)  increasing rural cash income to
improve food security and input access.
The following paragraphs offer some ideas about
remedial actions in five major areas which are
suggested by our research.  The next logical step
is to evaluate the relative costs and benefits of
these suggested options in view of developing
policies and programs that are economically
feasible and sustainable.
I. Peanut Seed.  There is a need to improve
capacity to purchase seed as this increases quan-
tities planted and contributes to improved quality
through replacement of household stocks.  Some
options to consider are:   1) increasing credit
availability,  2) making credit repayment schedules
more flexible, 3) promoting noncropping sources
of cash income.
Seed storage, supply, and marketing systems
can also be improved by:  1) promoting the sale
of certified seed through marketing campaigns;  2)
increasing distribution points for certified seed;
3) encouraging sales in smaller units than the 50-
kilogram sacks now used; 4) making certified seed
available for purchase year round; 5)  increasing
competition in the production and sale of certified
seed; and 6)  fostering extension programs to
promote insecticides and fungicides.
II. Soil Fertility.  Profitability of and access to
fertilizer can be improved by: 1) cutting costs of
production and distribution through infrastructure
investments, reduction in import duties and taxes,
and stimulating demand to levels that foster
economies of scale; 2) conducting analyses on the
level of subsidy required to increase fertilizer use;
3) judiciously using subsidies if cost/benefit
analyses show that subsidies provide net benefit to
society;  4) studying fertilizer response with
attention to local phosphates and combining
fertilizer with improved management (water
harvesting, windbreaks, etc.); 5) increasing private 
FS II Policy Synthesis No. 7 
Page 4
sector involvement in fertilizer promotion planning  that locates employment generating
(extension,  demonstration  trials). activities in rural areas that have high levels of
Promotion of organic matter is essential. development of rural enterprises that support
Measures to encourage this are:  1) programs that
promote livestock fattening to increase manure
availability; 2) feasibility studies for converting
urban waste to soil supplements; 3) research and
extension on technologies that increase green
manure or animal fodder; 4) programs to link
input use and improved natural resource
management practices (tying fertilizer credit to
composting, for example); and 5)  programs to
increase availability of crop residues for soil
enhancement (replacement of millet-stalk fencing
with live fences, for example).
III. Animal Traction Equipment.  Most existing
animal traction equipment is fully depreciated.
In the next 5-10 years there will be a major need
for manufacture, sales, and credit programs to
encourage recapitalization of the equipment stock.
Measures to consider are:  1)  providing credit and
technical support to local blacksmiths; 2) creating
a financial analysis unit in the extension services
to help farmers evaluate their debt carrying
capacity, particularly for traction equipment; and
3) reducing the costs of production for industrially
manufactured equipment.
IV. Land Tenure Legislation.  There is a need for
land tenure reform that permits (and protects
legally) transactions in land so as to ensure better
land allocation (those who need it get it). This will
increase cropping specialization, funneling
land to more productive farmers.  At the same
time, research suggests that titling land so that it
can be used as loan collateral does not have strong
farmer support.
V. Income Diversification.  Most farmers do not
want to abandon farming but want to diversify
income sources to reduce risk, improve access to
inputs, and increase income and food security.
Policy options that would help farmers diversify
income sources are:  1)  the promotion of micro-
enterprise programs (credit, training, etc.) in rural
areas, particularly in fragile zones; 2)  industrial
underemployed labor; 3) programs to encourage
agriculture through upstream (input The first set
of findings deals with provision, for example) and
downstream (output processing, for example)
linkages; and 4)  food-for-work programs targeted
at households with the most severe income and
food security problems.
*Funding for this research was provided by the Food Security and
Productivity Unit of the Productive Sector Growth and Environment
Division, Office of Sustainable Development, Bureau for Africa,
USAID (AFR/SD/PSGE/FSP).  The research was conducted under
the Food Security II Cooperative Agreement Between AID/Global
Bureau,  Office of Agriculture and Food Security, and the
Department of Agricultural Economics at Michigan State University.
The views expressed in this document are exclusively those of the
authors.
Kelly, Reardon, and Crawford are assistant professor, associate
professor, and professor respectively, at Michigan State University.
Diagana is a doctoral candidate at Michigan State University and
researcher at the Institut Sénégalais de Recherches Agricoles.  Gaye
is also researcher at ISRA.
This paper is a summary of a report entitled: “Cash Crop and
Foodgrain Productivity in Senegal: Historical View, New Survey
Evidence, and Policy Implications,” International Development
Paper No. 20.  It can be obtained by writing to:
MSU Bulletin Office
10-B Agriculture Hall
Michigan State University
East Lansing, Michigan 48824-1039
This paper is also forthcoming as an SD Publication Series technical
paper.  It can be obtained through USAID’s development information
system (CDIE) (catalogue number forthcoming).

Cash Crop and Foodgrain Productivity in Senegal: Historical View, New Survey Evidence, and Policy Implications

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