@article{Florence:198523,
      recid = {198523},
      author = {Florence, Nakazi},
      title = {Factors Influencing Farmer's Choice to Sell Milled versus  Unmilled Rice},
      address = {2013-06},
      number = {634-2016-41514},
      pages = {72},
      year = {2013},
      abstract = {The number of rice mills in Uganda has increased rapidly  during the past decade, presumably
in response to the  increasing demand for rice milling services by rice  farmers. However,
recent studies show that despite the  notable improvements in farmers’ access to  milling
services, some farmers still sell rice in unmilled  form as paddy, which attracts a lower price
than milled  rice (grain). This study was undertaken with the overall  objective of examining
why some rice-growing households in  Uganda sell milled rice and others don’t, and how  this
affects the profitability of rice production.
Data for  this study were collected in October 2009, through a survey  of 194 rice farmers in
Eastern Uganda by Makerere  University and Japanese International Corporation  Agency
(JICA). Descriptive statistical methods of data  analysis were used to characterize ricegrowing
households  by the form in which they sell rice; while the  profitability of rice
production was estimated using gross  margin analysis and compared using the difference of
mean  test between households that sell milled rice and those  that don’t. The factors
influencing the proportion of rice  sold as grain were analysed using the Tobit  regression
model.
The surveyed households were grouped into  three categories based on the form in which they
sold their  rice; “unmilled”, “milled” and “both”. Most of the sampled  households (83%) sold
all or part their rice as grain. On  average, households which milled all their rice before  selling
were endowed with significantly bigger landholdings  and households (family labor) than
their cohorts in the  “unmilled” and “both” categories. However, those who sold  all their rice
as paddy were faced with significantly  longer distance to the nearest mill than households
that  milled all or part of their rice before sale.
Profitability  analysis show that rice production is associated with  positive gross margins,
regardless of the form in which it  is sold, implying that rice production is a  profitable
venture. Although milling households incurred  higher costs, they also had higher gross
margins, implying  that selling milled rice is more profitable than selling  paddy. The price of
milled rice, volume of harvested rice,  household size, membership in rice-farmers’ group
have  significant and positive relationships with the proportion  of rice sold as grain; while distance to the nearest rice  mill is negatively and significantly associated with the  proportion
of rice sold as grain.
Farmers should be  encouraged and assisted to mill their rice before sale  through training and
extension, as well as other  interventions that reduce the transactions costs of  milling. Such
interventions include; facilitating their  access to yield-enhancing inputs to increase  harvested
volumes and helping them to market/mill their  rice in groups. Also facilitating private
entrepreneurs to  set up milling plants closer to farmers through such  measures as rural
electrification and reduction of  electricity tariffs; or to invest in mobile rice mills  through
improvement of the rural road network, for example,  would go further to reduce the
transactions costs of  accessing milling services and encourage rice-milling  before sale.},
      url = {http://ageconsearch.umn.edu/record/198523},
      doi = {https://doi.org/10.22004/ag.econ.198523},
}