Can Irrigation be an Answer to Kenyas Food Security Problem?

By Dennis C Otieno, Lilian Kirimi, Nicholas Odhiambo

Irrigation development is one strategy the government can use to improve food security in Kenya. Lessons from irrigated maize production studies show that it is profitable and that Galana Kulalu food security project has the potential to produce about half of the country’s food requirement contributing significantly to food security and the GDP through the incomes earned. However, high costs due to inefficient use of fertilizer, water and land are the major cost factors that have caused doubts and low level engagement in irrigated maize production.

It is thus recommended that efficient use of land, fertilizer and water under both intensive and extensive maize production under irrigation, would contribute to lowering the unit cost of production and lead to increased food production.

Major cost elements
The overall cost of production for irrigated maize was KES 15,705 per 90kg bag for the 2014/15 crop season. This is about 20% higher than that for non-irrigated maize which is KES 13,100 per 90kg bag. Evidence shows that the major factors contributing to this high costs are fertilizer, water and land preparation contributing 28.1%, 19.6% and 15.9% respectively.

The intermediate factors (pesticides, herbicides, transport, gunny bags, storage chemicals and their handling charges) and seeds have a relatively lower cost of 10.7% and 8.6% respectively. These two factors were sourced through farmer groups which lowered their procurement costs considering that these are marginal areas.

Poor road network and insecurity have made transport to be the most expensive factor in this category. Although the demand for labour was high, irrigated maize production experienced limited labour supply which contributed only 13.1% to the total cost. ASAL areas experience labour shortage due to the low population in these marginal areas.

Labour scarcity raises the wage rates for labour in irrigated farms making them much higher than non-irrigated farms. This has resulted in most farmers using family labour in field activities resulting in the apparent low cost of labour.

Revenues
The profit margins per acre and per bag under irrigated maize of KES 8495 and KES 772 respectively, were higher than KES 5003 and KES 658 for non-irrigated maize. The breakeven point was however inversely related to price and directly related to the cost of production.

Irrigated maize had a breakeven point of about 7 while non-irrigated maize had 5. Increasing maize price is associated with increased margin per bag. Irrigated maize also has an additional advantage in that output and profits can be increased by increasing the number of seasons

Efficiency tests
The results were used to estimate the statistics for efficiency test. The results show that fertilizer, water and land were inefficiently used while there was near optimal use of seeds and labour.

Optimal rates of application for fertilizer and water needs to be developed for different methods of water application. Water and land are significantly underutilized and this led to low output. The available option for increased production is to intensify the use of these factors on a small scale. The use of water saving technology and intensive land use would prevent excessive land and water wastage. Labour and seeds were well utilized.

Conclusions and Policy
Implications.
In conclusion, this study establishes that: Irrigated maize is profitable and the most important factors of production are fertilizer, water (amounts and method of application), labour and preparation practices. Irrigated maize is beneficial since it returns a high margin of 29% more per bag than nonirrigated maize, has higher output levels and its profit margins are higher. It is important to note that a 1% price increase increases profit margins by 0.615 % and cost margin by 29%.

The production of irrigated maize is flexible and one can have more than one crop in a year. This implies that high returns can be achieved if production is targeted at seasons when there is low supply of maize in the market.

The major cost limitations are the high cost of production due to high factor costs, small farm sizes, price fluctuations and limited labour. In terms of production, fertilizer, land and water have a significant effect on maize production though they are inefficiently used. Fertilizer is excessively used while land and water are underutilized.

Policy insights
The high profits, income and low cost per bag for irrigated maize is a sign of a viable venture though it has challenges for Galana-Kulalu food security project.

The project has the potential to increase the country’s maize output by about 5.5 million bags considering one seasons output and about half of the national food requirement i.e 16.5 million bags if they are to produce for three seasons. This is quite a substantial amount and can improve the food security situation and the GDP of the country.

However, there are challenges which needs to be addressed among them competing political interests in water use, human wildlife conflicts, insufficient water, high cost of irrigation investment, land use rights and the value chains for effect of large output levels on consumer and producer price levels have to be addressed so as to maintain all stakeholders gainfully employed in maize business.

What can be done to increase food production?
To improve on the plot and scheme level inefficiency associated with irrigated maize production and hence food production, the following actions are recommended.

Efficient use of water and water application methods since the factor is scarce. River Galana inadequate water means that centre pivot a more efficient water application method.

With the cost for water being paid for as a lump sum, cost reduction can be achieved through efficient use of water and water application methods. This would lower the water wastage and ensure sufficient amounts is available for maize.

R & D to increase maize productivity through technical change in irrigation technology package that embodies limited wastage of fertilizer, intensive maize production of under irrigation that gives high yield increases and reduce the unit cost of production and breakeven point and profit margins.

Expansion of maize production areas to tap into the 87% of the available irrigable land can exploit economies of scale and lower the unit cost of production. This gives room for area expansion which will lead to high output levels and margins per bag.