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Adoption, Impact and Economics of Reaper in Smallholders Rice-Wheat

Systems of Nepal

Technical Report · July 2016

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 Adoption, Impact and Economics of Reaper in Smallholders Rice-Wheat
Systems of Nepal

Manisha Shah*, Preity Khandelwal*, Gokul Paudel1, Scott Justice, Stephen Biggs,
Andrew McDonald

Working paper – I
Sustainable Intensification Program (SIP)

International Maize and Wheat Improvement Centre (CIMMYT)

South Asia Regional Office, Kathmandu, Nepal
JULY, 2016

*Manisha Shah & Preity Khandelwal were CSISA Interns until July 2016 from IRMA, Gujarat, India
0
1
Corresponding author: g.paudel@cgiar.org
SUMMARY

The use of farm mechanization in smallholders farming systems has been strongly advocated as

major developmental agenda particularly in South Asian countries. Farm mechanization increase

power inputs to enhance scale of farming operations, improve timeliness, reduce drudgery,

decrease cost of production and increase production efficiency. In the most recent years, the spread

of small scale machinery like reaper; rice and wheat harvesting machine, is increasingly been

adopted by farmers in Nepal. The aim of this study were; to assess determinants of reaper adoption,

to quantify the economic benefit associated with reaper adoption and to assess cost-benefit analysis

(CBA) of reaper in rice-wheat systems of Nepal. For this, data were collected from 100 reaper

adopters and 100 reapers non-adopters from four terai districts in mid and far western

developmental regions of Nepal. Findings from this study shows that households with labour

migration, higher education, better household’s off farm income, communication material (for

example mobile phone holders) and higher cultivated land are more likely to adopt reaper and

while family size is inversely associated with reaper adoption. Furthermore, the reaper adopter

were saving a net benefit of NRs 5592 per ha from rice harvesting and NRs 6313 per ha from

wheat harvesting than non-adopters. The cost benefit analysis (CBA) shows that, farmer owning

reaper have benefit costs ratio of almost 5.94 with payback period of almost 1 year when these

reaper owners provide services to other farms by taking rental charges. Finally, the problems and

prospects of reapers are described. It is recommended from the study that; where and what type of

intervention is suitable in smallholder’s system need to be assessed before promotion of any farm

mechanization based technology to achieve the success so that the technology is “fit for purpose”.

1
Table of Contents
SUMMARY .................................................................................................................................... 1
LIST OF TABLES .......................................................................................................................... 3
LIST OF FIGURES ........................................................................................................................ 3
1. Background ................................................................................................................................. 4
1.1 Introduction ............................................................................................................................... 4
1.2 The reaper story ........................................................................................................................ 6
1.3 Feminization of agriculture ....................................................................................................... 8
1.4 Farm machinery trade ............................................................................................................... 9
1.5 Objectives of the current study ............................................................................................... 11
1.6 Rationale of the study ............................................................................................................. 12
1.7 Limitations of the study .......................................................................................................... 12
2. Conceptual framework .............................................................................................................. 13
Adoption model ........................................................................................................................ 13
Cost Benefit Analysis (CBA).................................................................................................... 14
3. Methodology ............................................................................................................................. 15
3.1 Study areas .......................................................................................................................... 15
3.2 Sampling methods and data collection ............................................................................... 16
4. Results and discussion .............................................................................................................. 17
4.1 District wise profile of the respondents .................................................................................. 17
4.2 Characteristics of reaper adopters and non-adopters .............................................................. 18
4.3 Determinants of reaper adoption ............................................................................................. 20
4.4 Cost Benefit Analysis (CBA) of a reaper in rice-wheat system of Nepal .............................. 22
4.5 Gross margin analysis of reaper user and non-users for rice-wheat cultivation ..................... 23
4.6 Reflection from reaper owners and renters ............................................................................. 25
4.6.1 Types of reaper adopted by the farmers ....................................................................... 25
4.6.2 Price of the reaper ........................................................................................................ 26
4.6.3 Credit access to reaper purchase .................................................................................. 27
4.6.4 Problems related with reaper........................................................................................ 28
4.6.5 Enabling factors for reaper purchase ........................................................................... 29
4.6.6 Reaper service providers .............................................................................................. 29
4.6.7 Total area under reaper and no of reapers in sample districts ...................................... 30

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 4.6.8 Reaper renters prospective ........................................................................................... 31
4.6.9 Source of information about reaper ............................................................................. 32
4.6.10 Perception of non-adopters about reaper ................................................................... 32
5. SWOT analysis of farm machineries trade in Nepal ................................................................ 33
6. Conclusion ................................................................................................................................ 34
References ..................................................................................................................................... 36

List of tables
Table 1: District wise profile of respondents ................................................................................ 18
Table 2: Attributes of reaper adopters and non-adopters in study areas ....................................... 19
Table 3: Determinants of reaper adoption from logit model in study areas ................................. 21
Table 4: CBA of a reaper owner farmers (an ideal case from the survey) ................................... 23
Table 5: Gross margin analysis for rice production by reaper users and non-users (NRs/ha)...... 24
Table 6: Gross margin analysis for wheat production by reaper uses and non-users (NRs/ha) ... 25
Table 7: Net benefit from reaper service provision (N=50) ......................................................... 30
Table 8: Sources of information about reapers ............................................................................. 32
Table 9: SWOT analysis of small scale farm machineries in Nepal............................................. 34

List of figures
Figure 1: Timeline of spread of agro-machinery in Nepal adopted from Kienzle et al. 2013 ........ 5
Figure 2: (a) Man Operating 2WT propelled reaper for harvesting wheat in Kailali district of far-
west development region (b) A reaper trader demonstrating Chinese reaper in agriculture
mechanization exhibition-2016 in Nepalgunj. ................................................................................ 7
Figure 3: Map showing the location of the reaper owners tracked in open data kit (ODK) of
CSISA project ............................................................................................................................... 16
Figure 4: Price distribution of the reaper paid by the farmers ...................................................... 26
Figure 5: Source of credit for reaper purchase.............................................................................. 27
Figure 6: Problems related with reaper ......................................................................................... 28
Figure 7: Reaper purchase enablers .............................................................................................. 29
Figure 8: Estimated number and area under reaper for harvesting rice and wheat in Nepal teari 31
Figure 9 Non-adopters perception about reapers .......................................................................... 33

3
1. Background

1.1 Introduction

Agricultural mechanization has been viewed as a crucial input to the crop production process. As

an essential input, mechanization can transform farm family economies by facilitating increased

output, reducing drudgery, decrease the cost of production and increase production efficiency for

crop-livestock production. In a country like Nepal which is basically an agricultural country (65%

of population depending on agriculture for their livelihoods), increasing efficiency in agriculture

is fundamental to ensuring food security. Agriculture in Nepal, contributes one-third of national

gross domestic product (GDP) and is one of the largest sector for national GDP contribution.

Agriculture provides employment to around two-third of the total population and ensures their

livelihoods. In Nepal, there are disparities in land ownership and access across the regions.

Currently, around 60% of total are marginal farmers follow subsistence farming practices (MoAD,

2015). The current agricultural production systems are primarily subsistence type and crop

productivity level is stagnated. In such a scenario, maintaining the productivity and efficiency in

farming has been a challenge for a long time. Modernizing farms to increase production efficiency,

addressing food and nutritional security and attenuating the problem of poverty has been always

been the priority of Government, donors and development agencies.

Farm mechanization entered Nepal around 1970s with the import of Japanese and Korean 2WTs

(2-Wheel Tractor), which were more expensive and used for multiple purposes such as transport,

tillage, threshing amongst others. The bigger 4WTs (4-Wheel Tractor) entered Nepal after 1980s,

mainly after the Green Revolution hit parts of India bringing in the promise of prosperity and food

security. Today, almost two-third of the tractors in Nepal are 4WT and remaining are 2WT, which

have increased their share owing to cheaper models imported from China (Biggs and Justice,

4
2011). Rice-wheat harvesting in some parts of central and western terai are dominated by combine

harvesters while most parts of terai are still using manual harvesting. Owing to the surface

irrigation potential of Nepal, most farmers have resorted to electric or fuel-based pump sets from

India and China. Most of the drudgeries in farming are now being simplified and technology

solutions for harvesting, tilling, seeding and transplanting are all being used in varied numbers

across the country. In most recent year’s mechanization in hills have made a dramatic change

especially due to the spread of small scale mini-tillers, this could be one the unearthed story to

share. More than 10,000 pieces of mini-tiller has been adopted by the farmers in the hills, until few

years back hills (a major area for agriculture in Nepal) was been largely neglected due to difficult

terrain. Interestingly, there has been an increasing involvement of private sectors in spread of farm

mechanization in Nepal. The number of traders dealing with farm equipments has shot up to an all

time high and Nepal is witnessing a major shift from traditional to mechanized farm practices.

Figure 1: Timeline of spread of agro-machinery in Nepal adopted from Kienzle et al (2013).

Farm mechanization is seen favourably in the political spheres as well. In 2014, the Government

of Nepal endorsed farm mechanization policy. Such an environment is motivational and should

encourage large scale adoption of farm mechanization, the economic condition of majority of

5
farmers doesn’t allow them to take the risk. The uncertainty associated with the results due to

small, fragmented and scattered plots as well as the risk of becoming non-performing assets of

their creditors, are still holding them back from adopting large farm machines. In this situation,

the small and medium scale farm equipment have found more feasible due to their low cost, short

pay-back period and operational ease in all kinds of topography. 2WTs, more popularly known as

“power tillers”, have become popular due to their multiple uses, ability to work in small plots,

useful attachments and easy repair and maintenance. One such attachment is a reaper, which is

used for harvesting rice and wheat. A Reaper can be powered by 4WT or 2WT. The 2WT propelled

reapers have seen a surge in popularity and sales in the last couple of years. Due to the shortage of

time between crops, it is important to harvest timely as delayed harvesting can cause shattering in

crops (Rahman et al., 2004). Additionally, labour migration from Nepal to other countries

especially for finding income opportunities has surged the demand for the small scale farm

mechanization tools like reaper in Nepal. The increasing migration trend amongst youth has led to

shortage of labour and increase in on-farm wage rate. Manual harvesting for rice-wheat dominated

cropping systems of Nepal terai is becoming costly which increases the cost of production for the

farmers. With the advent of reaper in most recent years farmers demand for reaper is surging in

Nepalese traders market.

1.2 The reaper story

A reaper is used for harvesting of wheat and rice. The machine consists of reciprocating cutter bar

assembly, seven crop row dividers, two vertical conveyor belts fitted with lugs, pressures springs,

pulleys and gearbox for the power transmission system. The crop row dividers are fitted in front

of the cutter bar assembly and the star wheels are mounted over the crop row dividers. The machine

is mounted in front of the tractor and the power to the machine is given from tractor PTO with the

6
help of intermediate shaft running beneath the chassis of the tractor and a coupling shaft. Height

of the machine above ground is controlled by tractor hydraulic with the help of pulleys and steel

ropes. After the crop is cut by the cutter bar, it is held in a vertical position and delivered to one

side of the machine by lugged belt conveyors and fall on the ground in the form of a windrow

perpendicular to the direction of movement of machine.

Figure 2 : (a) Man Operating 2WT propelled reaper for harvesting wheat in Kailali district of far-west development
region (b) A reaper trader demonstrating Chinese reaper in agriculture mechanization exhibition-2016 in Nepalgunj.

Reapers were first introduced around half a decade back in Nepal, but have gained popularity in

the last three years. Rice is an extremely labour intensive crop; especially for transplantation and

harvesting requires more labour. Farm machines have come to the aid of farmers. With less home

labour available and reaper, especially, has made their harvesting a lot easier and faster. The

demand for reaper surge up when International Maize and Wheat Improvement Centre (CIMMYT)

introduced reaper in mid and far western development region. These areas were highly potential

areas especially in terms of spread of 2-WT (PTO) due to dominancy of smallholders farms. The

demonstration methods conducted by CIMMYT-CSISA project over this sites in year 2013

motivated farmers to adopt the reaper dramatically. Still many farmers use the traditional sickle to

harvest crops and combine harvesters are yet to make it to majority of the areas due to small and

7
fragmented plots. Even though, recently some of the combine harvesters has been introduced by

the private sectors in those areas. However, many farmers do not prefer harvesting by combine

harvesters due to fear of rice-wheat residue losses due to incorporation of livestock in their farming

systems. Most of crop residue in these area is feed for livestock as feed. Earlier studies in similar

part of Nepal shows that the spread of combine harvester is associated with environmental and soil

health problems due to residue burning. Additionally, due to dominancy of PTO owners in those

areas many PTO owners have started to take farm mechanization to an entrepreneurial level by

providing services to the other farms. This shows that small scale farm machines like reaper owners

has also enabled to run farmers own business models of service provision. In comparison to four

wheel tractors where most owners have to hired driver, such additional costs are not incurred in a

power tiller operated reaper where the owner himself is serving as a driver and providing services

to other farms. This has created a situation of additional income earning from agricultural

mechanization.

1.3 Feminization of agriculture

Women’s role in agriculture has seen a wide transformation throughout the world and more so in

South Asian countries like Nepal and India, where out migration of male members of the household

in search of employment has been prevalent for years. A decade- long civil war followed by the

democratic revolution has left few livelihood alternatives and thus, every moths thousands of male

members, mostly from agrarian backgrounds, migrate either to the bigger cities or to Gulf countries

in search of employment (Ghale, 2008). This has left women in villages with little option and thus,

Nepal is witnessing a major feminization in the agriculture sector. Women, traditionally, were

mostly involved in farming and were responsible for weeding, harvesting, bundling, transplanting

and transporting by traditional methods. As the men, who ploughed and tilled the fields are

8
becoming scare, women have to take over those activities as well. In such a situation, small and

medium scale machinery comes handy for the women, who, if trained well, can take over all the

activities in agriculture and make farming more efficient and reduce the drudgery associated with

crop production. Women who worked as daily wage labourers in the fields now have an option to

become entrepreneurs by providing such services to other women in the villages. Small and

medium scale machinery can be a boon in disguise for them. All it needs is awareness, training

and credit availability and the Nepalese women could take over agriculture completely.

Additionally, the current farm mechanization policy endorsed by the GoN along with the

Agriculture Development Strategy (ADS) document of GoN also advocates for the

entrepreneurship development in agriculture.

1.4 Farm machinery trade

Rapid shift in lifestyles of people and high migration in Nepal has encouraged farmers to move

towards a mechanized approach to agriculture. Farm mechanization trade in Nepal is a multi-

million industry, with medium and small scale industries making their entry in the Nepal market

only in the last few years. The huge expansion in the 4 WTs and the Chinese 2 WTs and pump set

business has drawn many into this business. In a year, a trader is capable of making minimum sales

of about NRs 33.3 million. The dealers in Kathmandu distribute to traders throughout the country.

The business has grown equally across eastern and western parts of the country. However, the

product range varies as per the topography. For instance the power tillers are more popular in

western Terai than the hills due to suitable topography and dominancy of smallholders farming

systems, while the mini tillers which are suitable for hilly terrain are found more towards the hilly

areas of Nepal.

9
Nepal’s historical, cultural and even political connections, along with a long and open border with

India have led to different patterns for investments in agricultural mechanization, whether it is

farmers buying machinery, establishing import and export businesses or local manufacturing

capability (Kienzle et al., 2013). However over the years, Nepal’s merchant importers have started

importing machineries from China too, which offers small and cheaper machines. The dealers in

Kathmandu have established an association called Nepal Agricultural Machinery Entrepreneurs

Association (NAMEA) which aims in promoting large, medium and small scale machineries trade

in the country. NAMEA conducts agriculture fares to promote new technologies along with GoN

and like-minded organizations.

The traders believe farm mechanization industry is thriving at a fast rate and anticipate it to have

a potential to only grow bigger in the future. As innovative techniques are coming up day after

another, the farm mechanization industry can be said to have an optimistic future. However, with

only 1% custom duty in the machines import and huge 50% for the spare parts fear the traders

dream to be a distant one. Additionally, the GoN has created the programs to subsidize farms for

small scale machinery e.g., PTO up-to 50% and due to the GoN subsidy program, the farmers wait

the entire season to purchase machines and this affected the traders machinery business. In line

with linkage of GoN and mechanization traders, grievance that the traders have is that not all

traders are able to get the subsidized machineries to be sold from them and it affects their trade

negatively as limited traders get opportunity for distribution of subsidized machines. With the

policies in place and increasing Government’s involvement with private sector (e.g., machinery

traders) in farm mechanization, the trader can outreach more farm machinery in future.

10
1.5 Objectives of the current study

The current study is specifically focused on the reaper which is been adopted by the farmers and

its adoption is in increasing trend especially in mid and far western development region. Therefore,

the objectives of the current study are:

To ascertain the determinants of adoption/spread of reaper: The sudden spread of reaper in

mid and far west developmental regions has been reported in last couple of years, since the

CIMMYT-CSISA project demonstrated reaper in those areas. More than 500 reapers have been

sold in the last three years as per the traders and the demand for these reaper is in increasing trend

as per the importers. The spread of reaper in short time period enables us to understand the factors

determining the reapers adoption in these areas since these intervention is up-scaled by the CSISA

project in Nepal. It has been observed that some clusters where reaper adoption is quite low while

in some sites the adoption is in rising trend and understanding the factors related with reaper

adoption helps Government and developmental agencies to design mechanization related programs

and implement effectively.

To quantify the benefits associated with reaper adoption: Harvesting rice and wheat crop is

labour intensive and time consuming which is a costly and traditional method. In line with this,

how far reaper adopters are saving money than those of non-adopters can helps us to quantify the

benefit of reaper adoption.

To understand the cost-benefit analysis (CBA) of reaper: The shift from primitive manual

means of agriculture to the modern age of agricultural mechanization has also opened avenues for

the entrepreneurial side of small scale mechanization in which owners are providing services to

the other farms. This objective helps understand the economic benefits of reaper owners and the

11
business model operated. The basic things to understand is find the Net Present Value (NPV),

Internal Rate of Return (IRR) and Benefit Cost ratio (B/C) of the reaper adoption. Additionally,

the current reapers explains the perception of reaper owners, renters and non-users in line with the

reaper and harvesting rice-wheat crops in Nepal terai. Finally, the report also explains about the

SWOT analysis of small machinery in Nepal.

1.6 Rationale of the study

The total number of tractors in Nepal is around 42,000, with 30,000 4WTs (71%) and 12,000

(29%) 2WTs (Biggs et al., 2011) and the number has dramatically increased in the most recent years.

Importantly, the number of small scale machineries like reaper is becoming most popular among Nepalese

farms. This inclination of Nepalese farmers towards mechanization forms an interesting area of

study. The reapers have entered the Nepal markets in last few years and the sales figures have been

astonishingly high, given the short period of time. This study aims to uncover the reason behind

adoption and benefits of reaper adoption. This study also aims to provide feedback to the

stakeholders associated problem with reaper. This can help traders, importers, Government and

development agencies in strengthening weak points associated with reaper and other small scale

machinery adoption.

1.7 Limitations of the study

Due to time constraints, the study covers only 50 reaper owners and same number of reaper renters.

As majority of the reaper owners have used reapers in the last three to four seasons only, and

extrapolation of results had to be done in the Cost-Benefit Analysis (CBA) with realistic

assumptions. The study was conducted during the rice transplantation period and no operating

12
reapers could be witnessed and the data collected was fully relied on respondents recall basis

survey.

2. Conceptual framework

Adoption model

The adoption decision of whether to adopt new small scale agriculture mechanization technology

or not to adopt such as reaper depends on the utility derived by the farmer (Feder et al., 1985).

Farmers will only adopt technologies if the expected utility of adoption is greater than non-

adoption , i.e., − > 0 (Kassie et al., 2011).

The random utility models presume that the utility derived by individual households from

using the reaper is composed of a deterministic component which can be calculated based on

observed characteristics and a stochastic error component, which is unobservable, such that;
∗ ∗
= + , = 1 if >0 (1)

Where, is a binary indicator variable that takes a value of 1 if household adopts reaper and 0

otherwise, is a vector of parameters to be estimated is a vector of explanatory variables and,

is the error term. The error component is unobservable, and therefore we do not have enough

information to predict an individual’s preference, but we can predict the determinants of

household’s reaper adoption from among other harvesting technologies such as manual harvesting.

The conditional probability of small scale machinery such as reaper adoption by a household based

on the observable characteristics can then be estimated by using either binary logit or probit models

as:
∗
Pr( = 1) = ( > 0) = 1 − (− ) (2)

Where F is the cumulative distribution function for , which is assumed to have a normal

distribution for the probit model, or logistic distribution for logit model.

13
Cost Benefit Analysis (CBA)

The cost benefit analysis of reaper involves calculation of its Net Present Value (NPV), Internal

Rate of Return (IRR), Benefit-Cost Ratio (B/C) and Payback Period. NPV is the difference

between the present value of cash inflows and the present value of cash outflows. It is used to

analyse the profitability of a projected investment in this case a reaper. A positive net present value

indicates that the projected earnings generated by an investment in reaper exceed the anticipated

costs, hence, is a profitable one. IRR is the rate at which the net present value of an investment

becomes zero. Hence, if IRR exceeds the cost of capital of the investment (rate of borrowing/

discounting rate), such an investment is worth doing. B/C Ratio is the simple ratio of net benefit

and total cost of an investment on the reaper. Higher B/C ratio means higher returns from the

reaper. Payback period calculates the time duration required to generate returns equivalent to the

investment based on returns already occurred or projected returns. The following equations were

used for deriving CBA analysis:

B −C
NPV = (3)
(1 + r)

B
∑
B (1 + r)
ratio = (4)
C C
∑
(1 + r)

Where B is the benefit from the reaper and C is cost of the reaper (purchase and the operational)

over the time “t”. The discount rate “r” which in this study has been considered as 12% following

ADB (2013).

14
3. Methodology

3.1 Study areas

The current study area is composed of four Terai districts from mid and far western developmental

region of Nepal, where Cereal Systems Initiatives for South Asia (CSISA) project has penetrated

different farm mechanization based technologies for Sustainable Intensification of farming

systems, since 2012. Sustainable intensification based technologies are focused on zero tillage seed

drills, minimum tillage, precision fertilizer and seeding application machines like earth-way

spreader, laser land levelling, reapers and others which are basically farm mechanization intensive.

These four districts are the most productive districts that lies in the Indo-Gangetic Basin (IGB) as

part from the Nepal terai. Rice-wheat is the predominant cropping systems existing in these

districts with livestock being incorporated in the faming system. These districts are dominated by

the Tharu indigenous communities. These are relatively lower in terms of farm mechanization,

however farmers have adopted PTO since long back. Except for the few sub-districts (Village

Development Committee: VDCs) with canal irrigation most of them use the ground water for the

irrigation. While diesel operated tube-well are the main source for pumping water from the ground.

While for harvesting rice and wheat majority of the farmers use traditional methods. The overall

rice area in Banke, Bardyia, Kailali and Kanchanpur is 33160, 42000, 57550, and 46618 ha,

respectively. While the wheat area is relatively lower than the rice area and occupies of almost

50% of rice area in these districts. Due to the low level of mechanization, CSISA project has

focused in those districts and have seen as most effective districts in terms of agricultural farm

mechanization based technology adoption.

15
3.2 Sampling methods and data collection
The current study adopted a simple random sampling method for the selection of reaper adopters.

The list of reaper owners has been tracked in Cereal System Initiatives for South Asia (CSISA)

Project Nepal’s web based data depository collected via android based Open Data Kit (ODK) tool.

A total of 251 reaper owners has

been tracked during the sampling

designing time (Fig 3).

The current study selected 50

reaper owners samples randomly

from the list of 251 reaper owners,

for the survey based on the

assumption that 20% of the

samples tracked will be sufficient Figure 3 Map showing the location of the reaper owners tracked in
open data kit (ODK) of CSISA project
to understand characteristics of reaper adopters, while the current study uses a snowball sampling

method for identifying renters of the reapers so that one reaper owner at least provide some

information on reaper renters, such that 1:1 ratio of adopters and renters can provide a total sample

of 100 reaper users. In current analysis we have considered reaper renters in adopter’s category.

Considering renters as an adopters is justified based on the assumption that an adopter simply

adopts technology by renting or by purchasing itself. While for non-adopters, household that lies

in proximate area of reaper owner/users were selected randomly. A total of 100 reaper non-users

were selected randomly such that ratio of 1:1 adopter and non-adopters maintained. In an overall

our sampling method consists of 200 samples of which 100 were the reaper adopters and 100 were

the non-adopters.

16
Data were collected from four enumerators after several rounds of pre-testing on the questionnaire.

The questionnaire related with household socio-economics, crop cultivation methods including

harvesting and household income were administered to reaper adopters and non-adopters.

Additionally, some of the questions related with reaper were been specifically asked to reaper

owners while some questions related with reaper renting were administered with reaper renters.

The survey was conducted during the year 2016 rice production time periods and information

provided was based on respondent’s recall basis.

4. Results and discussion

4.1 District wise profile of the respondents

The survey samples distribution according to the respective districts is presented in the table 1. In

Bardyia there were around 100 tracked owners and apart from that many untracked owners too.

The farmers in this district are less inclined towards renting out their reapers because of large

landholding compared to the farmers in other districts. Also, because many of the reaper owners

have purchased reaper only in the last wheat season owing to which the entrepreneurial aspect has

not been much explored by them where as in Kailali it’s the other way around, the farmers in

Kailali district have used reapers for two or more seasons and are also renting out. Out of the 100

reaper adopters, only 51 of them have used for rice harvesting while 86 of them used for wheat

harvesting and 37 of them were using for both rice and wheat cultivation. The surveys in

Kanchanpur have portrayed a different picture on the whole. The penetration of reaper has been

least in Kanchanpur district as compared to the other areas of study. The land holdings on an

average are smaller in Kanchanpur district (Table 1). Farmers still use the primitive method of

tilling with the bulls and threshing rice and wheat manually. The traders consider the reason to be

lack of awareness amongst the farmers and the declining interest in agriculture. As the area is close

17
to the Indian border, the locals have alternative sources of income other than agriculture. Only a

few reaper owners have been tracked in area that have purchased reaper through a cooperative

initiative and only members of the cooperative can rent reaper for personal use. Lack of subsidies

in reapers is also one of the reasons for low sales of reaper in the area. However, such area has a

potential for growth, with sufficient amount of awareness and promoting farm machineries to the

farmers.

Table 1: District wise profile of respondents

Bardiya Kailali Kanchanpur
(N=68) (N=126) (N=6)
Number of owners surveyed (no) 19 31 -
Number of renters surveyed (no) 14 35 1
Number of non-users surveyed (no) 35 60 5
Average family size (no) 8 8.61 8.61
Average land holdings (ha) 1.53 1.42 0.55
Credit Access (% hh) 38 33.33 34.12
Migration (% hh) 5.4 6.6 5.1

4.2 Characteristics of reaper adopters and non-adopters

The overall 200 samples surveyed have been further grouped into reaper adopters and non-

adopters, especially reaper owners and renters have been grouped into adopter’s category while

non-users have been grouped into non-adopters category. The cultivated land for overall sample

was almost 1.5 ha indicating dominancy of smallholders farmers, while the cultivated land was

significantly lower (p<0.01) for non-adopters (0.99 ha) than for reaper-adopters (2.07 ha) (Table

2). The family size which is generally taken proxy for the labour availability is significantly lower

in non-adopter’s category. While other variables like household head education, credit access, and

mobile holdings was also significantly higher for the adopter’s category. On the other hand, the

age of household head (household decision maker whether to adopt reaper or not) was significantly

higher for the non-adopters category. Majority of the adopters and non-adopters were male headed

18
households with Jananati (Tharu) as their caste background. Furthermore, most of the reaper

adopters has higher wheat area allocation (of cultivated land) while no such significant different

was detected for rice area allocation among the adopters and non-adopters category. Finally, the

per annum off farm income was also significantly higher (p<0.01) for the adopters category (NRs.

275703) than for non-adopters category (NRs 79373).

Table 2: Attributes of reaper adopters and non-adopters in study areas

All samples Adopters Non-adopters t-test
Variables (N=200) (N=100) (N=100)
Mean Std. Mean Std. Mean Std. Difference Sig.
error error error

Cultivated land (ha) 1.535 0.094 2.076 0.153 0.994 0.081 -1.082 ***
Family size (no) 8.45 0.380 9.51 0.601 7.39 0.444 -2.12 ***
Household head age (years) 40.47 0.807 38.96 0.995 41.99 1.258 3.03 *
Household head formal 5.22 0.334 6.5 0.472 3.94 0.439 -2.56 ***
education (years)
Gender of household head 0.89 0.022 0.94 0.023 0.84 0.036 -0.1 **
(1=male, 0 otherwise)
Caste of household 0.86 0.024 0.95 0.021 0.77 0.042 -0.18 ***
(1=Janajati, 0 otherwise)
Occupation (1=farming, 0 0.865 0.024 0.92 0.027 0.81 0.039 -0.11 **
otherwise)
No of migrated members 0.465 0.068 0.50 0.112 0.43 0.076 -0.07 ns
(no)
Cell phone holding (=1 if 0.675 0.033 0.81 0.039 0.54 0.050 -0.27 ***
hh members holds mobile
phone, 0 otherwise)
Credit access (=1 if 0.35 0.033 0.47 0.050 0.23 0.042 -0.24 ***
household have credit
access, 0 otherwise)
Market distance (km) 2.716 0.134 2.87 0.212 2.56 0.164 -0.30 ns
Wheat area allocation (% 74.67 1.99 78.9 2.21 70.4 3.26 -8.44 **
of cultivated land)
Rice area allocation (% of 99.19 0.286 99.25 0.39 99.15 0.42 -0.08 ns
cultivated land)
Off-farm income 177538 20076 275703 33734 79373 16960 -196330 ***
(NRs/year)
*p<0.10, **p<0.05, ***p<0.01, “ns” indicates not significant

19
4.3 Determinants of reaper adoption

The results for the determinants of reaper adoption as described in equation (2) are presented in

Table 3. The factors that significantly influence the probability of adoption decision of reapers are

cultivated land, education, caste, household with migrated members, cell phone holdings wheat

area allocation and off farm income. While family size has statistically significant negative

coefficient indicating that households having large number of family members are less likely to

adopt the reaper. It could be perhaps related with sufficient labour availability for harvesting rice

and wheat.

It is relevant to discuss the possible reason for significant of these factors related with reaper

adoption. The cultivated land has the positive coefficient and statistically significant perhaps due

to large farmers has more attraction towards reaper as currently very less alternative technologies

for harvesting technologies are available that could fit for larger farmer with more cultivated land.

Additionally, more educated farmers are more likely to adopt the reapers. It could be due to

increased level of awareness from years of schooling education as currently, the labour intensive

harvesting rice-wheat is becoming very expensive and educated farmers are more likely to take

economic advantage of reaper. Interestingly, the cell phone holding households are more likely to

adopt reapers perhaps due to increased communication and interaction level with outer society,

relatives, family members staying outside the communities and other people which could have

helped them to hear the reaper related message.

Most importantly, the current study revealed that households with more migrated members from

the households are more likely to adopt the reaper. It could be related with the labour scarcity for

crop cultivation due to household labour migration (Maharjan et al., 2013). In the current context

of Nepal, labour migration towards the other countries for searching income opportunities has been

20
increased in increasing trend. The households with more migrated members are more likely to

have labour shortage during crop harvesting time and these households are more likely to adopt

reaper.

Table 3: Determinants of reaper adoption from logit model in study areas

Variable Coefficient Std. error
Cultivated land 0.6013** (0.2994)
Family size -0.1090** (0.0517)
Household age -0.0048 (0.0189)
Education 0.1058** (0.0486)
Gender 0.5004 (0.7240)
Caste 1.6321** (0.6743)
Occupation 0.3694 (0.5981)
Household with migrated members 0.3849** (0.2267)
Cell phone holdings 0.7740** (0.4395)
Credit access 0.5763 (0.4249)
Market distance 0.1006 (0.1125)
Wheat area allocation 0.0158** (0.0073)
Rice area allocation -0.0963 (0.0701)
Ln off farm income 0.5332** (0.2143)
Constant -1.232 (7.189)
No of observations 200
LR_ch2(14) 102.25
Prob > chi2 0.000
Pseudo R2 36.88
Log likelihood -87.50
** indicates significant at <10% level of significance

Furthermore, the coefficient of wheat area allocation and off farm income is positively significant

with probability of reaper adoption. The significant of wheat area allocation could be related with

short harvesting time of wheat and drudgeries related with harvesting and threshing of wheat,
21
which is costly and labour intensive. Finally, the farms with higher off farm income are more likely

to adopt reapers perhaps due to increase in propensity to adopt technology due to alternative

income sources.

4.4 Cost Benefit Analysis (CBA) of a reaper in rice-wheat system of Nepal

The results for the CBA analysis as per the equation (3) and (4) are presented in Table (4). The

current CBA analysis suggest that the NPV of investing in a reaper that costs NRs 60000 (average

costs of reaper), which harvests 11 ha of rice and 16 ha of wheat area is NRs 164150 at 12% of

discount rate. The B/C ratio of such reaper owner is 5.96 with 55% IRR and payback period of

almost 1 year which indicate that time required to incur initial investment takes less than one year

(Table 4). In this analysis, we have accumulated the cash flow of reaper based on the seasons (rice

and wheat) because the NPV and payback period are only possible to analyse in long-run and most

of the reapers are adopted by the farmers since last 3-4 seasons. We also assume that the farmer

will earn and invest the same amount that he is earning and expending as in last 4 seasons for next

some seasons. This typical case of the reaper owner sample farmers has been put into the analysis.

The condition might differ for different farmers depending upon the area coverage of rice and

wheat by the reaper owner and the cash flow and the cost associated with reaper uses.

To generalize the situation for overall reaper owners, sensitivity analysis has been done. The

sensitivity analysis indicates that the investment is viable even if the costs increased by 20% or the

benefit decreased by 20% or both the cost increased by 20% and benefit decreased by 20%. This

indicates that a reaper owner when provides services can have short payback period and can

develop an entrepreneurship in small scale machinery. The situation mentioned as in table (4)

could prevail until the reaper market is fully saturated and may hold true for certain time period.

22
Table 4: CBA of a reaper owner farmers (an ideal case from the survey)
B/C ratio 5.96
NPV (at 12%) 1,64,150.22
NPV (at 15%) 1,49,148.90
IRR 55%
Payback Period (Years) 0.98 (1 year)
If total costs increased by 20%
B/C ratio 4.80
NPV at 12 percent (NRs) 1,56,718.50
NPV at 15 percent (NRs) 1,42,243.96
IRR 54%
If total benefit decreased by 20%
B/C ratio 4.57
NPV at 12 percent (NRs) 1,12,567.70
NPV at 15 percent (NRs) 1,01,251.39
IRR 42%
If total costs increased by 20% and benefit
decreased by 20%
B/C ratio 3.64
NPV at 12 percent (NRs) 1,05,135.97
NPV at 15 percent (NRs) 94,346.45
IRR 40%
Note: refer to appendix-1 for more details about NPV, IRR and cash flow for reaper business

4.5 Gross margin analysis of reaper user and non-users for rice-wheat cultivation

The costs of production and gross margin analysis for rice cultivation by reaper adopters and non-

adopters is presented in table 5. There was a significant different in terms of gross margin for

reaper adopters and non-adopters. The rice harvesting costs (NRs/ha) for the reapers adopters was

significantly lower (p<0.01) than reaper non-adopters. The average cost for the reaper adopters

was NRs 2241 per ha for harvesting rice, while the cost was NRs 8233 per ha for reaper non

adopters. The reaper adopters are saving the costs of almost NRs 5992 per ha while harvesting

rice. The higher costs associated with non-adopters could be due to use of labour for harvesting

rice.

23
Table 5: Gross margin analysis for rice production by reaper users and non-users (NRs/ha)
Rice reaper users Rice reapers non
(n=51) users (n=100)
Difference sig.
Mean Std. error Mean Std. error
Tillage and puddling 4917 814 7070 688 -2152 **
cost
Seed cost 4407 758 3925 395 481 ns
Fertilizer cost 11192 1072 10407 762 785 ns
Irrigation cost 1021 166 1291 195 -270 ns
Labour cost (except 23727 2089 28564 1889 -4837 ns
harvesting)
Harvesting cost 2241 267 8233 623 -5992 ***
Other costs 17141 1926 12920 1372 4221 *
Total variable cost 64649 3895 72413 3064 -7763 ns
Gross revenue 96087 7732 81157 3811 14929 **
Gross margin 31437 8481 8743 4250 22693 ***
*p<0.10, **p<0.05, ***p<0.01, “ns” indicates non-significant

The costs of production and gross margin analysis for wheat cultivation by reaper adopters and

non-adopters is presented in table 6. Significant different in terms of gross margin for reaper

adopters and non-adopters was detected. The wheat harvesting costs (NRs/ha) for the reapers

adopters was significantly lower (p<0.01) than reaper non-adopters. The average cost for the

reaper adopters was NRs 1875 per ha for harvesting wheat, while the cost was NRs 8188 per ha

for reaper non adopters. The reaper adopters are saving the costs of almost NRs 6313 per ha while

harvesting wheat. Similarly with the rice case, the higher costs associated with reaper non-adopters

could be due to use of labour for harvesting wheat.

24
Table 6: Gross margin analysis for wheat production by reaper uses and non-users (NRs/ha)
Wheat reaper users Wheat reapers non
(n=84) users (n=100) Difference sig.
Mean Std. error Mean Std. error
Tillage cost 5248 632 6939 637 -1690 *
Seed cost 6414 283 5869 329 545 ns
Fertilizer cost 10306 384 9366 490 940 ns
Irrigation cost 1709 197 1608 218 101 ns
Labour cost (except 5627 586 7109 595 -1481 *
harvesting)
Harvesting cost 1875 101 8188 788 -6313 ***
Other costs 7986 510 5681 418 2305 **
Total variable cost 39169 1286 44763 1413 -5594 **
Gross revenue 62236 3660 49165 2843 13071 ***
Gross margin 23067 3382 4401 2850 18665 ***
*p<0.10, **p<0.05, ***p<0.01, “ns” indicates non-significant

4.6 Reflection from reaper owners and renters

4.6.1 Types of reaper adopted by the farmers
The formal survey and interactions with several mechanization local and national

traders/importers, it was evident that the most preferred model of reaper sold was 4GL-120. In our

survey sample of 50 reaper owners only 1 reaper (2%) farmers have adopted 4GL-130 model

reaper. However, 49 farmers (98%) of farmers was using 4GL-120 model reaper. 4GL-12o model

reaper is a 2WT propelled and diesel engine operated reaper. The number of blades and the

operating ease has been found to be more apt by the farmers in this model. All the reapers are

operated by male members of the family and female members have, so far, not been seen keen to

operate them. Individual ownership in reapers is greater than co-operative due to the apparent

reasons of lack of responsibility and task division, difficulty in maintenance etc.

25
4.6.2 Price of the reaper

Depending on the source and time of purchase, the purchase price of reaper paid by farmers was

found highly variable and price ranges from NRs 40000–93000 (Fig 4). There were few owners

who have purchased second hand reapers at NRs 30000. The mean price of reapers paid by the

farmers was found to be NRs 62370 and more than 80% reaper owners purchased within a price

range of NRs 60000-80000. Some of reaper owners have purchased reaper even in less than NRs

60000, due to either subsidy from GoN or other developmental agencies or promotional discount

provided by the traders. Few of the reaper owners purchased in higher price of NRs 70000 and

more, during the blockage time in Nepal terai. During the blockage time the stock was limited and

only a few traders had the stock so, they charged exorbitantly high prices in that period.

Above 80000 (N=50)

70000-80000
Price (NRs)

60000-70000

50000-60000

40000-50000

Less than 40000

0 5 10 15 20 25
Frequency

Figure 4: Price distribution of the reaper paid by the farmers

From the survey it revealed that, even though, the cost of reaper is not very high, but the price

variability has compelled farmers to pay higher price for the reaper. Additionally, most farmers

prefer to buy reaper on their own without taking any sort of financial help from any sources. They

feel that they would be able to make up for the cost within a few years either by providing rental

26
services to the other farmers. Interestingly, it has been observed that some of the traders were

providing easy instalment schemes, sometimes without interest to facilitate reaper adoption.

4.6.3 Credit access to reaper purchase

The current survey on reaper owners suggest that almost 68% of the reapers owners doesn’t source

any credit for reaper purchase. While rest of the others take credit from different other sources like

cooperatives, banks, family relatives and even from machine traders. On an average, the reaper

owners who have availed credit for reaper purchase have to pay interest at the rate of 17% and

have to pay back within 1 year and 2 months (two seasons). It is quite interesting that even though,

the GoN prioritize for agricultural loan but farmers are reluctant to take the loan from bank due to

drudgery associated with taking loan especially due long time and lengthy procedure. Subsidy on

reapers is not common and only one out of the fifty respondents surveyed had received subsidy

from developmental organization.

(N=50)

16%
2%

8%

6%
68%

Self Group/Cooperatives
Bank Family/Relatives
Traders

Figure 5: Source of credit for reaper purchase

One of the interesting thing from this survey is that most of the farmers preferred to purchase

reaper and other small scale machineries from local traders mainly because of the post purchase

27
services they provide by the traders. Most of agriculture mechanization related traders are

providing operational training and services to the farmers for repair. Our survey sample suggest

that, almost 66% of the owners received post purchase services in terms of assembly, basic

operational training or repair or both related with reaper.

4.6.4 Problems related with reaper

The current survey from the sample of 50 reaper owners revealed that even though farmers are

mostly satisfied with the performance of reapers in terms of cost saving method for rice-wheat

harvesting but many of the farmers were saying problems associated with reaper. Only, 10% of

the reaper owners have not faced any problems yet with reapers (Fig 6). Majority of the owners

have faced some problems with reapers such as operational difficulty, repairs knowledge, and

availability of spare parts.

(N=50) No issues

10% 4% Repair
18%
Operation

Small plots
22% 28%
Others

18% More than one

problem

Figure 6: Problems related with reaper

Other problems include difficulty in harvesting when the crop spread was thin, fragmented and

small plots, and frequency of belt snapping. Wear and tear is, however, not an apparent issue with

28
reapers. More than 80% respondents reported low or no wearing of their reapers since purchase.

This indicates a long life and thus, can reduce the risk farmers feel while adopting.

4.6.5 Enabling factors for reaper purchase

The major factors that have enabled owners to purchase reapers were high shortage of labour

during harvesting time and drudgery associated with harvesting. In our survey almost 33% of

respondent primarily purchased reaper due to drudgery issue while almost 25% purchase reaper

due to labour shortage. While few percentage of the farmers take it from business prospective of

making money by providing services to other farmers.

35
(N=50)
30
Percentage sample (%)

25

20

15

10

0
Extra Income Low Payback Labour Ease of Reduced
Generation Period Shortage Operation Drudgery

Figure 7: Reaper purchase enablers

4.6.6 Reaper service providers

Like the larger agricultural equipment such as 4WTs, even the 2WTs and the attachments such as

reapers holds a bright future in custom hiring services. As many farmers can’t afford to buy their

own machines, renting is a more preferred option for them. The survey shows that one reaper has

catered to up to 25 renters in rice season and 40 renters during wheat season. However, there is a

huge variability in the number depending upon the keenness of reaper owner and direct and indirect

29
competition in villages. Additionally, some of the renters replied that there was not availability of

reaper during the peak harvesting time due to limited reapers in the village. The figures from

survey data shows that on an average, a reaper owner can earn NRs 21286 (Table 7), with rental

rates that ranges from NRs 2500 to 3600 from harvesting one ha of rice and wheat. This, in

proportion to the average price of the reaper, is comparable to the earnings from a 4WT and thus,

is a very profitable business opportunity for the farmers.

Table 7: Net benefit from reaper service provision (N=50)

Av. no of renters per Av. area harvested by Av. net earnings from
Crop reaper (no) reaper (ha) each reaper (NRs)
Rice 6 6.17 10670
Wheat 4 4.27 10616
Total 10 10.44 21286
Data source: Field survey 2016

4.6.7 Total area under reaper and no of reapers in sample districts

The current study estimated the total number of the reapers adopted by the farmers in sample

districts using key information from local traders, regional traders, importers, adopters along with

different Government and non-government agencies. This study estimates almost 678 reapers in

sample districts along with other terai districts of Nepal and they are basically used for harvesting

rice and wheat. On an average almost 3313 ha of rice and wheat was harvested by using reaper as

per the estimate (Fig 8). Additionally, as per the observations and discussions with the local

farmers in study areas, it is evident that in coming years the number for reaper sell could increase

dramatically because of awareness and cheap machinery. This is an opportunity for the traders to

expand their trade and try to reach as many farmers as possible. The policy makers could support

this by creating enabling environment for disseminating agricultural farm mechanization

technologies.

30
 (3313 ha)

678

(1165.4 ha)

(512.6 ha)
158
22

2014 2015 2016

Area Harvested by Reaper (in Ha) No. of Reapers

Figure 8: Estimated number and area under reaper for harvesting rice and wheat in study areas
4.6.8 Reaper renters prospective

The current survey captures the prospects of reaper renters as well. The response form 50 renters

surveyed for reason for using reaper was; reducing drudgery (15%) associated with harvesting rice

and wheat, labour shortage (25%) while harvesting, short harvesting time of crops and fear of

delay in harvesting due to shattering losses and delay in seeding time for the next crop (35%) and

high labour wage rate (30%). The overall prospective from renters suggest that due to use of reaper,

the problem of delay in seeding for next season crop is solved for example in rice harvesting time

wheat is the next seeding crop and during wheat harvesting time spring maize, mungbean etc are

the next ultimate season crop. This adds value for the providing ample opportunities for increase

in cropping intensity in Nepal teari. Furthermore, renters mostly prefer using reaper for harvesting

wheat rather than rice due to the muggy field during the harvesting time and further refinement in

reaper could also encourage reapers wide scale adoption.

31
4.6.9 Source of information about reaper

Getting information related with agricultural technologies is crucial part for technology adoption.

Even though, CSISA project has initiated reaper related demonstration in those survey districts but

farmers are also acquiring information from other sources as well. Most of reaper owners and

renters got the information from their neighbours (75%) and while only 2% of them got

information from extension agents primarily from Governments. Interestingly, almost 14% of

adopters got the information from other service providers. There were almost 10% of the samples

who hear the information about reaper from radio jingles.

Table 8: Sources of information about reapers

Information source No of adopters (no) Percentage (%)
Extension Agents 2 2%
Service Providers 14 14%
Neighbours 74 74%
Radio jingle 10 10%
Total 100 100%

4.6.10 Perception of non-adopters about reaper

Amongst the 100 non-users sample surveyed, three-fourth of them had awareness about reapers

whereas the rest did not have any knowledge of a harvesting machine (Fig 9). The primary reason

for not adopting reapers by those who were aware was related with small plot size, fragmented

land, and high price of repair and sufficient household labour for harvesting and threshing crops.

The details about the non-users perception about the reaper is presented in figure 10. Importantly,

accessibility of reaper is still an issue and perhaps, in the long run with the wider level of adoption

this can be diminished. However, land consolidation strategy can overcome the small and scatter

plots which can ease for the mechanized system in those districts.

32
 8% Unaware
7% 21%
Small Plots

Fragmented Land

16% High Rental Cost

Difficulty to get
23% during harvesting
8% High Price

Lack of subisdy
12% 5%
Others
(N=100)

Figure 9 Non-adopters perception about reapers

5. SWOT analysis of farm machineries trade in Nepal

In the due course of study, around 10 traders and 2 importers were interviewed in order to get

holistic perception of the farm machinery trade. The interviews were aimed at capturing the

trader’s perspective about the business, the success stories, challenges faced and the future

opportunities for small and medium scale machines like reapers. Table 9 presents the SWOT

analysis which captures traders, importers, farmers and stakeholders perception about small scale

farm machinery in Nepal. On the strength side the reaper is becoming very popular among

smallholders and marginal farmers because its cost is lower and life cycle is longer and is mostly

the demand driven technology. While on the weakness side; lack of skilled operator is the major

drawback of reaper along with frequent wear and tear problem because of the cheapest technology.

While the major threat that has seen for reaper adoption is the introduction of combine harvesters

because combine harvester does both harvesting and threshing at a time. Further exploration of

33
technologies is required to secure the future of reaper in line with threshing technology attached

with reaper.

Table 9: SWOT analysis of small scale farm machineries (e.g., reaper) in Nepal
Strengths:
• Successful among marginal farmers
• Low cost of maintenance and fewer
complaints
• Life cycle of small farm machinery
industry is long
• Spare parts easily available within the
country
• Demand driven industry, needs less
marketing
• Decreased dependence on human labor
• Large customer base
Opportunity:
• Increasing wage rate due to migration
• Entrepreneurial aspects (e.g. Service
providing and making money)
• Up-gradation of lifestyles (less
drudgery)
• Training for increasing operational
efficiency
• Women friendly, can help women in the
era of feminization of agriculture
Weakness:
• Operational difficulty due to lack of skilled
operators and trainers
• Attachments lead to higher degree of wear
and tear in the engines
• Incomplete work done in some case as
reaper, so farmers still need to hire labor
for bundling and threshing rice and wheat
crops
• Shorter life span as compared to 4WT
• Lack of skilled mechanics for timely repair
• High import custom duty for spare parts
(50%)
Threat:
• Popularity of bigger machines such as
Combine Harvesters
• Declining interest in agriculture amongst
the youth
• Market disturbance due to subsidies
• Uneven distribution of subsidies

6. Conclusion
The role of mechanization in agricultural development is to increase production, productivity and

profitability of agricultural crops and that is done especially by increasing power inputs to increase

34
the scale of farming operations and to improve timeliness, reduce drudgery, decrease cost of

production and increase efficiency of crop production. Previous studies have shown that

smallholders farms are less endowed with resources and are less capable of adopting farm

mechanization based technologies. Using farm survey data collected from smallholders farming

system in Nepal, we present the case of reaper; a rice and wheat harvesting farm mechanization

tools, to argue that smallholder farmers are capable of adopting technologies when such

technologies are “fit for purpose”. To present this, we collected data from 100 reaper adopters and

100 reapers non-adopting farms from four terai districts in mid and far western developmental

region, to investigate the determinants, economic benefit and cost benefit analysis of the reaper.

Findings from this study shows that family size is negatively associated with reaper adoption and

while households with labour migration, education of household head, household’s off farm

income, communication material and cultivated land are positively associated with reaper

adoption. Furthermore, the reaper adopter farms are saving a net benefit of NRs 5592 per ha from

rice harvesting and NRs 6313 per ha from wheat harvesting than reaper non-adopting farms. The

overall cost benefit analysis (CBA) shows that, farms owning reaper have benefit costs ratio of

almost 5.94 with payback period of almost 1 year when these reaper owners provide the services

to the other farms by taking rental charges. It is recommended from the study that; where and what

type of intervention is essence to the smallholder’s system need to be assessed before any

intervention is to be implementing either from research and/or developmental prospects in

developing countries like Nepal.

35
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Kathmandu.
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Employment in South Asia: Reopening the Debate”. Economic and Political Weekly, Vol
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Feder, G., Just, R.E., Zilberman, D., 1985. Adoption of agricultural innovations in developing
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Ghale, A. “Feminization of Agricultural Sector in Nepal”. Nepalnewsweek.com
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alleviation in Uganda. World Dev. 39, 1784–1795.
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in Nepal. Working paper IV. Centre for the Study of Labour and Mobility, Kathmandu,
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______ www.investopedia.com

36
 Appendix-1: Costs benefit analysis of reaper in rice-wheat systems of Nepal
Period Season Net Total Present Value of Present Value of
incremental costs Incremental Income* Total Cost (at 12
benefit/ (NRs) (at 12 %) (NRs) %) (NRs)
income (NRs)
0 Initial -60000 0 -60000 0
Investment

1 Wheat 18400 3600 17358.5 3396.2

2 Rice 43437.5 6562.5 38659.2 5840.6

3 Wheat 46400 8600 38958.3 7220.7

4 Rice 43437.5 6562.5 34406.6 5198.1

5 Wheat 46129.03226 8870.96 34470.3 6628.9

6 Rice 43437.5 6562.5 30621.7 4626.3

7 Wheat 18451.6129 3548.38 12271.4 2359.9

8 Rice 43437.5 6562.5 27253.2 4117.4

Total 303130.6 50869.4 233999.2 39388.1

* Note: due to incorporation of rice and wheat (2 seasons/year) the discounting rate has kept 6%.

37

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