This post was written by Kekeli Kofi Gbodji, William Quarmine and Thai Thi Minh, International Water Management Institute (IWMI).

Cocoa farmers are willing to invest in solar-powered irrigation pumps as a climate-smart adaptation measure. But high costs and limited credit options restrict their ability to invest. These are the findings of research we conducted among 523 smallholder cocoa farmers in 11 key cocoa-producing districts.

Cocoa is essential to Ghana’s economy and contributes around 30% of the country’s export earnings. However, climate change is negatively affecting production. While supplemental irrigation could improve cocoa yields and farmers’ income, particularly outside the primary growing season, cocoa is largely rain-fed.

To counter the risks posed by climate change, farmers are increasingly applying adaptive strategies, such as improved cocoa varieties, and crop and income diversification. However, high-potential, climate-smart innovations that demand substantial investment, such as solar-powered irrigation pumps (SPIPs), are often avoided.

To better understand the factors determining farmers’ investment decisions, we investigated farmers’ willingness to invest (WTI) and ability to invest (ATI) in SPIPs. We divided the farmers into three resource segments, based on farm size, to ascertain how WTI and ATI vary across different user segments. The segments are resource-poor (0.1-6 acres), resource-limited (>6 and <16 acres) and resource-rich farmers (>15.9 acres).

A cocoa farmer in Ghana. Photo Credit: Barbara van Rijn/IWMI.

Farmers’ willingness to invest in irrigation

The research, which was supported by the Feed the Future Innovation Lab for Small Scale Irrigation (ILSSI) and Africa Research in Sustainable Intensification for the Next Generation (Africa RISING) program, shows that a growing number of cocoa farmers have a strong interest in SPIPs.

WTI among resource-rich farmers was influenced mainly by household size, education, income, off-farm activity and cocoa land size. Resource-rich farmers in higher income categories were more willing to invest in water-lifting technologies. For instance, belonging to the medium- and high-income categories increased WTI by 27.3% and 33.7%, respectively. Education also positively impacted resource-rich farmers’ WTI. An extra year spent in school was likely to increase WTI by about 2.2%, which is higher than the other segments. Meanwhile, household size reduced WTI, as larger households were more likely to have higher household expenditure and, therefore, less income available to invest in SPIPs.

WTI among resource-limited farmers was influenced by education, income, age of the cocoa trees, access to information through extension agents and access to credit. Access to formal credit had a positive impact, as WTI increased by 24.1%. In addition, belonging to the high-income category in this segment was likely to increase WTI by 23.1%. The significant positive effects of financial factors, such as income and credit, prove that farmers’ WTI is mainly constrained by these two variables.

Household size and the age of the cocoa trees negatively influenced WTI in both the resource-limited and resource-poor segments. Elderly trees are less productive and prone to pests and diseases, reducing yields even with an investment in irrigation.

Farmers’ ability to invest in irrigation

The average price of a standard SPIP that can irrigate at least one acre of a cocoa farm was estimated at the time of the study to range between Ghanaian cedi (GHS) 25,000 ($3,108) and GHS 30,000 ($3,729). When we compared this price range with farmers’ incomes and the proportion of this income they could safely invest over a five-year period, we found that about 56% of the resource-rich farmers had the ability to invest.

By contrast, only 28% of resource-limited farmers and 12% of resource-poor farmers could invest in SPIPs. We discovered that while many of the sampled cocoa farmers were willing to pay for SPIPs, the number who could actually pay for the technology was markedly lower.

IWMI partners with the public and private sector to scale-up solar-based irrigation. Photo Credit: Barbara van Rijn/IWMI.

Practical implications and recommendations

Policymakers and private sector businesses who promote climate-smart technologies, such as SPIPs, need to understand the demand for their products. The WTI and ATI reported in our research may support efforts to design effective strategies for the market-oriented promotion of SPIPs to different segments of cocoa farmers, if the following recommendations are considered.

• Financial constraints are an important obstacle to WTI, and particularly ATI, in SPIPs. Policies and interventions that promote the use of SPIPs should be accompanied by appropriate income diversification and “soft financing” schemes, such as cash credit and credit sales, or irrigation equipment leasing arrangements. These will improve the financial capacity of resource-constrained farmers to meet the SPIP investment cost. Irrigation “bundles” that combine solar-based technologies and services with affordable financing options have shown significant promise for irrigated production of other crops in Ghana, Ethiopia and Mali.
• To improve climate literacy, SPIP supporters should collaborate with the Ghana Cocoa Board to strengthen the capacity of extension agents to educate farmers on the need to adopt climate-smart irrigation technologies. To address the negative effect of large household sizes on WTI and ATI in SPIPs, large cocoa farming families should be prioritized, if possible, in any future credit schemes accompanying the sale of SPIPs. This would lessen the financial burden of large families, thus improving their ATI.
• Our observation that the average age of cocoa trees had negative impacts on WTI aligns with the findings of the Ghana Cocoa Board’s Productivity Enhancement Programmes (PEPs). As the PEPs have included cocoa rehabilitation as a potential solution to address this problem, we recommend integrating promotional activities for SPIPs. This will ensure that fewer productive and diseased cocoa trees are replaced, helping to boost cocoa production and revenues and raising the WTI and ATI for SPIPs. This will require strong collaboration between the Ghana Cocoa Board and SPIP supporters.
• Finally, any interventions to improve the production or technical efficiency of cocoa production at the farm level could benefit SPIPs. Strong interest in SPIPs is good for farmer-led innovation scaling, which could trigger win-win climate-smart adaptation.