Effect of subsidy program on fertilizer usage and maize-grain Productivity among small-scale farmers in Kakamega county, Kenya

Abstract

The continuous use of land over some time has undermined the availability of soil nutrients globally. The decline in soil fertility is among the main challenges facing crop productivity, especially in Africa. To counter the soil nutrients issue, farmers are required to intensify the application of fertilizers. However, inorganic fertilizer application rates in Sub-Sahara Africa remain low compared to other developing regions. A number of government-led interventions and strategies have been introduced to raise fertilizer usage. One policy instrument so far implemented is the fertilizer subsidy program for small-scale farmers. Despite, the criticisms on targeting and voucher allocation procedures, fertilizer subsidies continue to be implemented by national and county governments in Kenya. However, there has not been much achievement in the overall crop yields, especially for maize where productivity is declining despite the continued subsidies for fertilizer as reported in the Kakamega County Integrated Development Plan. This study sought to estimate the proportions of subsidized fertilizer utilized, determine the socio-economic factors affecting the proportions of subsidized fertilizer utilized in the overall inorganic fertilizer usage, and determine the effect of the subsidized fertilizer program on maize-grain productivity among small-scale maize farmers in Kakamega County. The study adopted rational choice theory and theory of production using a Cobb-Douglas function to estimate maize-grain yields attained by farmers. This study was done in Malava and Mumias East Sub-counties on a study population of 44,098 farmers targeting 80% of farmers practicing maize farming; representing the sub-counties with the highest and least number of farmers in Kakamega County. The study employed a crosssectional survey design using semi-structured questionnaires to obtain data from 300 farmers, selected using a multi-stage sampling technique. Descriptive statistics were used to estimate proportions of subsidized fertilizer utilization, a Tobit regression model to determine the socialeconomic factors influencing proportions of subsidized fertilizer utilized, and a two-stage probit and Tobit approach controlling for program selection bias to determine the effect of the fertilizer subsidy program on maize-grain productivity. Results revealed that the average proportion of subsidized fertilizer utilized was 59.48% among subsidy program participants. Moreover, the findings showed higher average fertilizer usage of 85.6 kg/ha among the program participants compared to 74.9 kg/ha for non-participants. The proportion of subsidized fertilizer usage by farmers was significantly influenced by the farm size under maize, household size, quantities of seeds planted, age and education level of the household head, distance to the input market, and amount of credit borrowed. Tobit model results showed that subsidy program participation led to an increase in maize-grain productivity by 32.3%, after controlling for actual fertilizer quantities, seed quality, and household socio-economic characteristics. The average maize productivity was 2.216t/ha with Malava having a significantly higher average of 2.265t/ha compared to Mumias East at 2.11t/ha. Farmers who benefited from the subsidy program had average productivity of 2.46t/ha significantly higher than non-participants who had an average of 1.97t/ha. However, despite this positive effect, the fertilizer subsidy program in Kakamega County has not been able to increase maize yields to the potential production levels (5.5 t/ha), since the average fertilizer usage is still low as compared to what is recommended for the county for it to make an impact on productivity. The study recommends the subsidy program as a good strategy to attain the recommended application rates of 200 (NPK) and 150 (CAN) kg/ha as the participants have higher fertilizer application rates. Moreover, policymakers need to consider the socio-economic factors of small-scale farmers when formulating policies on allocation, as they are the main target for the program to attain optimal fertilizer application, and increased maize productivity.