Kwamena Quagrainie Purdue University, USA Charles Ngugi and John Makambo Moi University, Kenya.
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Transcript of Kwamena Quagrainie Purdue University, USA Charles Ngugi and John Makambo Moi University, Kenya.
THE USE OF CREDIT IN FISH PRODUCTION IN
KENYA
Kwamena QuagrainiePurdue University, USA
Charles Ngugi and John MakamboMoi University, Kenya
Kenya Aquaculture
Small-scale and medium-scale
production of tilapia
(Oreochromis niloticus) and
catfish (Clarias gariepinus)Total production about 1,000
mt/yearFarms concentrated in western &
rift valley regions
Background
Many farmers are literate, retired
civil servants, etc.Commercial banks providing
credit services for fish farming.Government support and
favorable policies towards
aquaculture.
Purpose of Study
Need for investments in fish
farming to move from
subsistence to commercial
production.
Examine attitudes to credit &
factors that influence use of
credit.
Survey
Questionnaire solicited information on:
Demographics
General Farm operations
Fish Farm operations
Results - Demographics
Responses = 131Males – 85%Average age 50yrs
Western, 69%
Rift Valley, 20%
Central, 6% Eastern, 5%
Regional Response
Primary35%
Secondary39%
Adult Ed4%
PostSecondary17%
Other Ed5%
Educational Level
Results - Demographics
Average # of ponds = 6 Average acreage = 616m2
Results
Other producers
Direct to cosumers
Fish vendors Other Multiple outlets
11%
60%
3% 7% 9%
Market Outlet
Economic Analysis of Credit Use
Simple Binary Probit Analysis
Dependent variable: Whether or not credit is used to purchase inputs
Explanatory variables Region; western=1, otherwise=0 Age Educational level; primary, secondary
or adult=1, otherwise=0 Total pond acreage Value of tilapia sales in past 6 months
(KSH) Value of catfish sales in past 6 months
(KSH) Type of market outlets; multiple=1,
otherwise=0 Fulltime labor cost per day (KSH)
Parameter Estimates
VariableCoefficie
nt p-valueConstant -1.089 0.089Western region 0.871 0.013Age 0.005 0.664Some education -0.318 0.366Pond acreage -0.001 0.042Tilapia sales 0.261 0.006Catfish sales 0.086 0.080Direct to Customers -0.082 0.782Fulltime labor cost -0.006 0.009 Pseudo R-squared 0.20% Correct Predicted 78.62
Marginal Effects
VariableCoefficie
nt p-valueWestern region 0.190 0.003Age 0.001 0.662Some education -0.088 0.396Pond acreage 0.000 0.022Tilapia sales 0.067 0.005Catfish sales 0.022 0.083Direct to Customers -0.021 0.783Fulltime labor cost -0.001 0.006
How do variables affect the probability of credit use?
Interpretation of Results
Farmers in the Western region have 19% higher probability to use credit than farmers from other regions.
A m3 increase in pond acreage and a KSH increase in fulltime labor cost, increase the probability of credit use by 0.02% and 0.14% respectively.
A KSH increase in tilapia and catfish sales increase the probability of credit use by 7% and 2% respectively.
Implications of Results
In general, there is a low probability of
credit use by fish farmers.
More education is needed about the use of
credit to expand aquaculture operations
and improve commercialization.
Focus should be in the Western region
where there is a greater % of aquaculture
operations.
Acknowledgement
This study was sponsored by the
Aquaculture & Fisheries
Collaborative Research Support
Program (AquaFish CRSP) funded
under USAID Grant No. EPP-A-00-06-
00012-00 and by Purdue University,
USA and Moi University, Kenya.