Cost-benefit analysis of hay production in different Farm sizes in Kajiado County, Kenya

Kenya Agricultural and Livestock Research Organization (KALRO)

Download

Abstract: Hay production is critical in addressing drought risk reduction in pastoralism livestock systems. Although providing animal feed during droughts is not debatable, in Kenya, there is insufficient robust financial and economic data to support the upscaling of hay production in pastoral arid and semi-arid lands (ASAL). A cost-benefit analysis was conducted from a survey of 354 pastoralists and 23 hay farms to determine the profitability of hay cultivation from 3 acres to 400 acres under different cultivation practices in Kajiado County. Farming practices considered were owning or hiring farm machinery, using rain-fed or irrigation systems, and building hay barns. The findings indicated high capital costs of owning machinery (balers, tractors, cutters), irrigation systems, and building hay barns negatively affected the profitability and viability of the hay production enterprise. Hay farms that cultivated less than 100 acres and those producing less than 4250 bales per year were not profitable, given a sale price of USD 1.80 per bale. Hay prices fluctuated, with the highest prices noted during drought seasons/years. Hay barns incurred high costs to construct, although indicated as necessary for storage of longer than one year period. The selling of hay every two years did not offset the annual operating costs within farms. External County financial support was considered a sustainability strategy for hay production in ASAL areas to cushion hay producers against the erratic hay market prices. The setting of private-public partnerships to stabilise production, markets and distribution is encouraged.