The Impact of Cost Management of Smallholder Farmers on Competitive Advantage from Zero-burn Agriculture Mae Sot District Tak Province

Abstract

This research consists purposes were 1. to study the costs and returns for cost management of zero-burn agriculture of smallholder farmers in Mae Sot District Tak Province and 2. to analyze the impact of cost management of smallholder farmers on the competitive advantage of zero-burn agriculture in Mae Sot District Tak Province. This study is qualitative research with interviews used as research tools. Researchers selected 20 households of sugarcane farmers in the Mae Kasa sub-district from specific target groups to participate in this research and analyzed the data collected from interviews and related documents. The results showed that 1) the production cost of sugarcane cultivation had an average cost of 12,725 baht per rai for new sugarcane, and sugarcane stumps had an average cost of 8,585 baht per rai. In addition, sugarcane stumps, the sugarcane planted in the second year onwards, have a cost decrease of 4,140 percent, or 32.53 percent, due to the lack of raw material costs because the cost of sugarcane varieties is only invested for the first time. Moreover, there would be no labor costs for the preparation of sugarcane soil in the second year, so the average production cost would be reduced. The average profit for new sugarcane was 1,675 baht per rai, and the average profit for sugarcane stumps was 5,815 baht per rai, which was an increase of 4,140 baht or 71.20 percent. It could be seen that the investment in sugarcane cultivation would be profitable from the first year and would increase in profit in the following year and 2) Sugarcane farmers also used this cost information in the management of production budgeting planning and budget expenses. It was not only for designing their financial and investment strategies effectively, but also because it was worth the investment. Obviously, for the second year of sugarcane cultivation (sugarcane stump), if they take good care of it, it will make the sugarcane stump last for many years. However, it is necessary to control variable costs that may increase in costs due to inflation. Farmers had prepared emergency plans to deal with risks that might occur in the future and had created a network of partners to help planting and management operate effectively. Sugarcane farmers reduced costs from zero-burn agriculture. Moreover, they could reduce labor costs from burning sugarcane leaves by an average of 60 baht per rai. Increasing the value of products from zero-burn agriculture helped farmers sell sugarcane at more than 1,000 baht per ton of sugarcane. There was also additional income from the use of unburned sugarcane leaves to be sold to make fuel. Cutting fresh sugarcane to cover the soil made sugarcane stumps more productive than burning sugarcane by 1.2-1.5 tons per rai. This is also considered to reduce the health costs of farmers and local people.