Total productivity and technical efficiency of coconuts in Malaysia

Mohammad Nor, Nor Amna A’liah and Engku Ariff, Engku Elini and Nik Omar, Nik Rahimah and Zainol Abidin, Ahmad Zairy and Muhammad, Rasmuna Mazwan and Rahim, Hairazi and Nazmi, Mohd Syauqi and Sulaiman, Nurul Huda (2020) Total productivity and technical efficiency of coconuts in Malaysia. [Journal / Magazine]

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Abstract

Coconuts are highly nutritious, rich in fibre, antioxidants and packed with essential vitamins and minerals. It is known for their versatility uses ranging from foods to cosmetics. As the coconut industry is experiencing rapid growth due to high demand for coconut-based products, the question of whether Malaysia can increase their coconut productivity and improve efficiency in their operation currently arises. This study gathered information on coconut farmer’s profiles, management system and production cost as well as productivity and technical efficiency of coconut farm activities. The results showed that the total cost of production for coconuts was RM9,739.18/ha/yr. Major expenditure was for labour cost which covered 34.4% of the total cost. The Cobb-Douglas production function exhibited that the area had a significant positive correlation with production at a = 1% level while the seed factor had a significant negative correlation with production at a = 5% level using Maximum Likelihood Estimation (MLE). Average productivity index of 1.97 showed that farms were in low efficiency level. The Cobb-Douglas analysis also showed that the technical efficiency analysis was 99% with an elasticity (e) of 1.1699. This indicated that the farm was operating at an increasing return to scale. Current technologies practiced are still in the productive level, but the input combination could be improved to produce better output.

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