Farmers’ Willingness to Pay for Cocoa Grafting in the Eastern Region of Ghana

Abstract

Cocoa production is very critical to the livelihood and survival of many smallholder farmers in Ghana. However, one of the challenges of the sector is low yields which is partly attributed to the widespread presence of old cocoa trees. It is therefore imperative to provide solutions to improve yield, of which the side grafting technology is a proven method. The study assesses Farmers’ Willingness to Pay for Cocoa Grafting in the Eastern region of Ghana. The research sought to find the level of awareness of side grafting in cocoa among farmers, the amount farmers are willing to pay for cocoa side grafting as well as the factors influencing willingness to pay amount. The multi-stage sampling technique was used to sample 217 cocoa farmers in the Eastern region. A well-structured questionnaire was used to solicit data from farmers. The contingent valuation method was used to estimate the willingness to pay amount of cocoa farmers. The double hurdle model was then used to estimate the factors influencing willingness to pay for side grafting. From the analysis of the data, it was realized that majority (87%) of the cocoa farmers are unaware of side grafting as a canopy substitution method, with majority (89%) willing to adopt the technology should it be introduced. The contingent valuation analysis also revealed that the maximum amount farmers are willing to pay for a side grafted cocoa tree is GH₵10 and the minimum amount is GH₵.10. The average WTP amount is GH₵2.84. On adoption of side grafting, farmers’ yield of 0.98 tons is higher as compared to the national average of 0.4 tons. The percentile distribution of WTP amounts show that at the 25th percentile, farmers are willing to pay GH₵0.50 or less. The result also showed that education, frequency of extension visit, age of cocoa farm, income from cocoa and household head status positively influence farmers’ WTP for side grafting whiles farm size negatively influences WTP. Furthermore, education, frequency of extension visit, age of farm, awareness, income from cocoa, and household head status positively influence farmers’ WTP amount for side grafting whiles farm size and yield negatively influences farmers’ WTP amount. The study recommends that demonstration centers should be set up in various areas of the region to aid acceptance of cocoa side grafting among farmers. Moreover, FBOs should be supported to enhance their capacity so they can effectively educate farmers on the technology. For a wider coverage of the side grafting technology, implementing institutions could peg the price for side grafting a cocoa tree at GH₵0.50 or less. Produce buying companies and NGOs could also intervene by providing the technology for farmers on deferred payment.