Economic Evaluation of Production Costs and Returns of Potato Crop in Sylhet Region of Bangladesh

Abstract

Potato production is becoming one of the major profitable crops among the famers in the northeastern part of Bangladesh. This study investigates the occupational status, land tenure arrangement, household income scenarios, and estimates the level of costs and net income variation for potato production in the greater Sylhet areas of Bangladesh by using the both descriptive and statistical techniques. The descriptive results exhibit that most of the households involved in farming as well as other income generating activities; however, the highest income share comes from the household business followed by agricultural activities. Near about half of the farmers belonged from the small category (46.39 percent) and around 37 percent were pure tenant while 30 percent were mixed tenant involved with both sharecropping and cash lease farming. Nonagricultural income and remittance are the key income sources of employment that influence the average per capita income. Agriculture share was approximately 9 percent in total household income where rice dominates the major share and potato does not have significant contribution. However, seed, irrigation, fertilizer, and hired labor cost were the major cost components for potato cultivation. This study also decomposed the variance of net income into different factors and found that gross income difference exists among the farmers due to the fertilizer and seed cost variation. Gross income explained the net income variation, which implies that potato yield or potato price (quality) or both vary widely among the farmers. This study can contribute to mak ing links between the shares of farm household income that would be helpful for policy makers to understand the causes of cost and income variation as well as opt for better strategies to support the farmers.