COMMERCIALIZATION OF SMALLHOLDER AGRICULTURE IN GHANA: A TOBIT REGRESSION ANALYSIS

The agricultural component of the Millennium Challenge Account (MCA) programme in Ghana, consistent with the country’s Food and Agriculture Sector Development Policy (FASDEP) promotes the commercialization of smallholder farmers. This study analyzes the trends in maize and cassava production by farm households in Ghana and; estimates the levels of commercialization of these two crops. It also quantifies the magnitude and direction of factors influencing intensity of commercialization by the farm households using the Tobit regression analysis. Results indicate a higher annual growth rate of cassava production (16%) compared to maize production (6%). The extents of maize and cassava commercialization are 0.53 and 0.72 respectively; whilst total agricultural commercialization with respect to these two crops is 0.66. The study observes, inter alia, that output price, farm size, households with access to extension services, distance to market and market information determine the extent of commercialization. These results have implications for agricultural policy in Ghana.