1. Cost-Benefit Analysis of Africa RISING Technologies in Tanzania: Summary of initial results Bekele H. Kotu Contributing scientists: A. Kimaro, M. Swamila S. Lyimo,Yangole, V. Afari-Sefa, P. Lukuman, F. Ngulu, J. Kihara, A. Abass, Beatrice, M. Bekunda, I. Hoeschle- Zeledon Africa RISING East and Southern Africa Review and Planning Meeting, July 14-16, 2015, Malawi

2. The study  This study aims to assess the profitability of agricultural technologies under study by AR team in Tanzania  Research questions  Are the technologies profitable? (Absolute Assessment)  Are the technologies better than the base technologies in terms of financial benefit? (Relative Assessment)  We considered 59 technologies under trial in Tanzania (both Babati and Kongwa-Kiteto research zones)  11 technologies are base technologies while the remaining technologies are new ones

3. The study  Designed to increase the productivity/loss of several crops: maize, pigeon pea, eggplant, tomato, and amaranths  We have data for 2 years for 32 technologies, but only a one year data for the remaining technologies  The technologies can be categorized  Soil Fertility Management (SFM)= 46  High Value Crops (HVC)=9  Postharvest Management (PH)= 4

4. The study  More than 1400 data observations from 11 separate experiments  Used both biological and economic data  These include o Grain yields o Output prices o Labor input and costs, land cost, draft power costs, costs of commercial inputs (seeds, fertilizers and pesticides)

5. Analysis  Computed three economic indicators  Gross margin (TZS/ha)  Benefit-Cost –Ratio  Returns to labor (TZS/persondays)  Conducted sensitivity analysis  Output price changes  Input price changes  Wage rate changes

6. Results LowerSimilarHigher Gross Margin (GM)11433 Benefit Cost Ratio (BCR)12126 Returns to Labor (RNLB)12918 Table 1: AR technologies Vs Base technologies

7. Results AR technologyBase TechnologyT value MeanSDMeanSD GM4755819230214981873409129937073.588* BCR1.71.51.22.55.338* RNLB**908190096497555641.339 Table 2: Performance of the technologies * Significant at 1% level **Average wage rate is 3596TZS/day

8. Results GMBCR RNLB MeanSDMeanSDMeanSD SFM 480674a5429801.5b0.6 8159b 5445 HVC 53474654b 6341026 1 4.3a4.119590a23520 PH* 11066c110953.4b3.115378b13868 Table 3: Performance of the technologies, by type *Based on changes in net benefit due to the new technologies a,b,c: means with similar letters are not different from each other at 5% level of significance

9. Results Figure 1: No. of technologies at different profit levels

10. Results Figure 1: No. of technologies at different profit levels SFM

11. Results Figure 1: No. of technologies at different profit levels HVC

12. Results Figure 1: No. of technologies at different profit levels PH

13. Sensitivity Analysis Figure 2: Sensitivity to output price, input price, and wage

14. Sensitivity Analysis Figure 3: Sensitivity by technology category (GM)

15. Sensitivity Analysis Figure 4: Sensitivity by technology category (BCR)

16. Sensitivity Analysis Figure 5: Sensitivity by technology category (RNLB)

17. Sensitivity Analysis Figure 6: Effect of output price changes on No. of profitable technologies

18. Sensitivity Analysis Figure 7: Effect of input price changes on # of profitable technologies

19. Sensitivity Analysis Figure 8: Effect of changes of wage rates on No. of profitable technologies

20. Sensitivity Analysis Figure 9: Number of technologies at various sensitivity level Median =4.4 Median=2.1 4 29

21. Concluding remarks  Most of the technologies are either better than or as profitable as the base technologies  Profits mostly lie between the breakeven point and the 100% threshold  But profits can go even more than 100% for a few technologies  Profits are more sensitive to changes in output prices than changes in input prices or wage rates  The level of sensitivity also varies among the technology categories, SFM being the most sensitive ones  The results are initial: we included a one year data for some of the technologies  The study considers only economic parameters, and other advantages of the technologies are not considered  Moreover, profits have been considered from individual farmers’ point of view but not from society’s point of view.

22. Africa Research in Sustainable Intensification for the Next Generation africa-rising.net The presentation has a Creative Commons licence. You are free to re-use or distribute this work, provided credit is given to ILRI. Thank You b.kotu@cgiar.org