Technical and chemical input use efficiencies of small-scale sugarcane growers : a case of northern KwaZulu-Natal

This study measures the technical, scale and chemical use efficiency of small-scale sugarcane growers in the KwaZulu-Natal province of South Africa. The paper applied the input-oriented approach assuming a variable return to scale Data Envelope Analysis (DEA), Slack Based Measure model and Truncated regression model to estimate productive efficiency and its determinants. The multi-stage sampling technique was applied to collect cross-sectional data from 300 small-scale sugarcane growers for the 2015-2016 production season using a questionnaire. The estimated mean technical, scale and chemical use efficiency decomposed using the input-oriented DEA were 72.5%, 77.9% and 68.3%, respectively. Using the truncated regression analysis, we found that education, off-farm income, farming experience, extension support, and land size were significant determinants of technical efficiency. However, farming experience together with extension support and land size were negatively related to technical efficiency. We propose policy reforms aimed at stimulating optimal sugarcane production by improving production scales and chemical-input allocation which are managerially driven rather than natural induced production issues.