The Proportion of Credit Structure Purposes Based on Cost Structure and Determinant Factors of Credit Demand by Farmers on Rice Farming Typology of Tidal Land
Abstract: Government policies to increase production and farmers' income at the same time with the ultimate goal of poverty reduction; one of them through distribution credit to strengthen farmers. Such efforts implemented by providing capital assistance which known as program of Food Security and Energy Credit. This research determines the proportion of credit purposes in the capital structure of farmers on farming, especially rice and determine the factors that influence the demand for agricultural credit by farmers, especially rice farming. The research was conducted in two
…show more content…
Keywords: credit; cost structure; credit demand and Tidal swampland
Key Words: (11Bold)
INTRODUCTION:
The factor of capital to finance still plays an important role in the development of farming systems in tidal swamp land, South Kalimantan. This capital can be obtained from internal farmer, result of the accumulation of income after consumption and can also be obtained from the external form of credit. Previous research findings on swamp land farming belonging to the sub-optimal land; among others by Makki et al (2008) and also Akudugu (2012) showed that the factors of financing and capital becomes one of the factors that determine the success of farming.
Base on previous studies, there is important to follow up because different with general characteristics that have so far in the implementation of agricultural businesses. Purposes of financing and capital in order to optimize farming in tidal swamp land just on the phases of certain activities and appropriate characteristics, then there is a difference between the purpose and use of capital between the tidal land farming compared to farming on the typology of rainfedor dry land.
Currently, access to farming credit relatively easy and credit schemes provided by the government has also been relatively large. But the main problem faced in terms of capital sources is actually the viability of a given credit scheme. Moreover, when the aspect of sustainability is focused on
Several factors that were considered are accepted as common predictors of agricultural adoption in developing countries. However, three questions related to explanatory variables were not included in the final questionnaire. Firstly, we did not consider access to bank loans because coffee farmers in Mexico are mostly unable to obtain investment credit from lending institutions. Coffee producers usually have the option of obtaining short term financing (cash advances) either from local traders or from coffee cooperatives for those who are members. However, the availability of long term credit has virtually disappeared making it difficult for producers to defer the costs of implementing over several years (AMECAFE, 2009).
During the last six (6) months, the small business of rice did not really work well, the sale has decreased. There is an inflation of the products and the national currency is losing its value. The people that was not used to consum local products got worse because the products become more expensive comparing to the imported products. This situation has lead to a deficit or loss that we are trying to solve with other selling strategies and buy buying less products now. But again this will have a repercussion on the farmers they will not be selling their products quickly and they had worked really hard to find water to give to the land because there is a lack
Rice industry is an important industry which is heavily protected and subsidised by the government in Malaysia. Rice was and still is the staple food in Malaysia and it is vital for the nation's food security. Since rice is a strategic crop in Malaysia, government put on various efforts and implemented subsidies to protect the rice industry. According to statistics from the Finance Ministry, government had subsidised a total of RM488 million in year 2012 and RM528 million in year 2013 which we can see that the amount of subsidy has increased year by year. However, the subsidisation on rice carried both merits and demerits. In this case, discussions about whether government should or shouldn’t continue subsidising essential good like rice in Malaysia will be concerned. Besides that, issue like producers will gain more from subsidy or the consumers will be discussed as well.
Around 85 percent of farms worldwide are classed as smallholders. The World Bank names supporting smallholder farming as the single most effective way to stimulate economic development in rural areas. In emerging markets, agriculture supports – directly or indirectly – three out of four of those in the lowest income brackets.
3. Inadequate Institutional Credit: Agriculture credit is disbursed through multi-agency network consisting of Commercial Banks(CB), Regional Rural Banks & Co-operative Banks. Still, approximately 50% of farmers depend on
In the 2000s, based on the FAIR Act of 1996, the government continued direct payments and provided 16.3 billion dollar of agriculture subsidies in 2002 Farm’s Bill. Meanwhile, there were some criticisms to Farm’s Bill. Critics regard that those large number of subsidies violate the agreement of World Trade Organization because of subsidies is a kind of trade barrier. In the 2008, the Congress passed the Food, Conservation, and Energy Act (2008 Farm’s Bill). The budget of 2008 Farm’s Bill was $288 billion. With this high budget, it caused controversy of budget deficit. Besides, in the past ten years, the 75% of the subsidy dollars were received by only 10% farmers.
Weather risk, due to climate change, is getting unpredictable. There are two ways to counter this risk viz. financial instruments and crop genetic improvement. For biological vulnerability, a suitable pesticide or weed management is the obvious solution. Market outreach is possible with digital technology and smart warehouses (Ahmad and Jamshed 2015a). Majority of farmers, if suffering from major diseases due to exposure to hazardous and unhealthy work environment, should get regular health care, insurance and epidemiological facilitation. Government subsidies do help the farmers provided those really reach the targeted farmers fully and timely. The aim of financial inclusion and sustainable growth is to cover these family farmers. Government move to open their bank accounts for giving direct transfer to the beneficiaries is the first step. Regular subsidy doses to cover all the farmers’ risks will not serve the purpose. The input suppliers, service providers, banks, insurance companies, procurement agencies, market functionaries, SHGs, warehouses and commodity exchanges all are to be connected with family farmers through proper linkages. This way government alone will not shoulder the risk coverage responsibility. Market mechanism involving private sector operators in addition to banks, insurance companies and SHGs will take maximum load of risk coverage. The government, without taking full load on its exchequer, may only guarantee or partially or selectively sponsor some
Nevertheless, after the introduction, the chapter begins by clarifying what kind of farmers this study refers to by defining smallholder farmer, elements of smallholder, and the farming environment as to understand and identify some key variables in farming environment that will enhance our investigation of farmers’ livelihood.
Sriram (2007) has stressed that the policy intervention in agriculture has been credit driven only, which becomes more pronounced in the recent interventions made by the government through the policy of doubling of agricultural credit, providing subvention and putting an upper cap on interest-rates for agricultural loans, revival of co-operative credit structure through the package recommendation by the Vaidyanathan Committee and policy responses to farmers suicides but argued that it is very difficult to establish a causal relationship to show that the increased supply and administered pricing of credit will help to increase agricultural productivity and the wellbeing’s of farmer. In his paper, he tried to examine the demand side issues of agricultural credit from a policy making perspective and conditions that makes credit more effective or productive in a real sense for which he suggested that there is a need to look at the rural financial services as a broader theme rather than limiting it to agricultural credit flows only, because mere increase in the supply of credit will not address the problem of productivity unless it will be not accompanied by investments in other supportive services.
I am also grateful to other lecturers including Professor S. A. N. D. Chidiebelu and Professor O. Okereke. I give special thanks to the lecturers and students during the 1986-87 session of Masters Degree programme in Agricultural Economics at the University of Ibadan. In particular, I received intensive guidance from Professor S. G. Nwoko, my thesis supervisor. He encouraged and inspired me so much towards quantitative and econometric methods. I note specially m y helpful interactions with Professor S. O. Olayemi, Professor F. S. Idachaba and other academic staff.
The major aim of this research was to determine the responsiveness of cotton production to cotton contract farming. This was done as a way to estimate the extent to which area put under cotton production and cotton output are influenced by credit forwarded through contract farming in the context of smallholder farmers.
Fiji Indian rural households engaged in sugarcane farming mostly own one or two bullocks and horses or, more rarely, a tractor in terms of physical assets (Carswell 2003; Ward 1965; Kingi and Kompas 2005). These rural farmers often do not own machineries for farm operations mainly for two reasons. First, they are not wealthy enough to afford the purchase and it is relatively difficult to feed the cattle due to limited land for grazing (Carswell 2003, p. 137; SCGC 2012, p. 2). Secondly, the farm sizes are too small to adapt to mechanization (SCGC 2012, p. 2). Bullocks and tractor, or some times horses are used on the farms for ploughing and harrowing the land (Carswell 2003, p. 137; Kingi and Kompas 2005, p. 17). It is also used for clearing tracks to lay portable rail lines in the field for the cane trucks (these rail trucks can be transported to and from the farms on tractor-trailer) (Carswell 2003, p. 137; Kingi and Kompas 2005, p. 17).
Rural development has been discussed extensively in the literature by various writers from different disciplines. The universal objective of rural development is to improve the quality of life of rural people. This is facilitated upon a continuous process by government, non-governmental organizations (NGO) and different actors at the (inter) national, state and local levels. Without doubt, this involves how best to organize rural area resources and potentials (especially human and economic potentials) so as to achieve an increase in the overall standard of living of the rural community dwellers. According to Halwart et, al (2003), the idea is to sustain the growth of rural economies, improve rural community livelihood and to promote food security through the improvement of food supply, employment and income. This chapter is divided into four parts. Part one reviews some approaches to the application of agropolitan center strategy in rural physical planning in selected third world countries. Part two examines the basic theories that relate to the spatial organization of human settlements by some well known writers such as Friedman, Christaller and others. Part three relate these theories to the present research and part four looked at large scale agriculture and rural development in the context of aquaculture.
Factors Affecting on loan Repayment Performance of Farmers in Khorasan-Razavi Province of Iran Mohammad Reza Kohansal Assistant professor of agricultural economic dep., Ferdowsi University of Mashhad, Iran Hooman Mansoori Msc student of agricultural economic dep., Ferdowsi University of Mashhad, Iran Abstract This study investigated the factors influencing on repayment behavior of farmers that received loan from agricultural bank by using a logit model and a cross sectional data of 175 farmers of Khorasan-Razavi province in 2008.
Poverty is perhaps a major cause for rural indebtedness. The low level of rural incomes, the uncertain and primitive farming of small landholdings makes it impossible to meet the needs required for their living. Often, the rural people take debts to meet these needs.