Decomposition Analysis of Maize Production in India

**Data Sources**

The current study is purely based on secondary data drawn from the Directorate of Economics and Statistics, Land Use Statistics, Department of Agriculture, Cooperation and Farmers Welfare (DACNET) [3]. Government of India. Data on the state-wise area under maize crop has been taken into consideration to analyse the extent and coverage of maize production in India. For our suitability of analysis, data on two different periods have been taken into consideration, i.e. 2009-10 and 2019-20. In order to understand the consumption pattern of maize, the poultry industry is one of them, where maize is used as poultry feed. Thus, the poultry population has been taken into consideration. Poultry population data has taken from the Department of Animal Husbandry and Dairy, Government of India. In addition, export data on maize has taken from the Directorate General of Commercial Intelligence and Statistics, Government of India. The study has covered 29 major Indian states namely, such as Andhra Pradesh, Assam, Bihar, Gujarat, Haryana, Himachal Pradesh, Karnataka, Kerala, Jammu & Kashmiri, Madhya Pradesh, Maharashtra, West Bengal. It also included the newly formed states like Jharkhand, Chhattisgarh, Uttarkhand and Telangana.

**Compound Annual Growth Rate**

The pace of a region's agricultural development can be ascertained by measuring growth in area, production and yield of crops. In the present study, compound growth rates of area, production and yield for the selected states for each period were estimated to study the growth in the area, production and yield. Compound growth rates were estimated with the following exponential model:

$$Y = ae^{bt}$$

**Decomposition Analysis**

To measure the relative contribution of area and yield to the total output change. The decomposition analysis model, as given below, will be used. Sharma and Subramanyam [6] redeveloped the model, and several research scholars used this model and studied the growth performance of crops. The method state that if $[A]_0,P_0$ and $Y_0$, respectively area, production and productivity in the based year and $A_n,P_n$ and $Y_n$ are values of the respective variables in nth year item.

$$P_o = A_o * Y_o \text{ and, } P_n = A_n * Y_n \dots(\text{i})$$

Where, $A_o$ and $A_n$ represent the area and $Y_o$ and $Y_n$ represents the yield in the base year and nth year, respectively.

$$P_n - P_o = \Delta P, A_n - A_o = \Delta A, Y_n - Y_o = \Delta Y \dots(\text{ii})$$

From equations (i) and (ii), we can write

$$\Delta P = A_o \Delta Y * 100 + Y_o \Delta A * 100 + \Delta Y \Delta A * 100$$

$$Yield\ effect = \frac{A_o \Delta Y * 100}{\Delta P}, Area\ effect = \frac{Y_o \Delta A * 100}{\Delta P}, Interaction = \frac{\Delta Y \Delta A * 100}{\Delta P}$$

Thus, the total change in production can be decomposed into three components: yield effect, area effect and the interaction effect due to change in yield and area.

**Global Trends of Area, Production, and Yield of Maize Crop**

Maize is an important cereal in many developed and developing countries in the world. It is widely used for animal feed and industrial raw materials like biofuels and alcoholic beverages in developed countries, whereas developing counties mostly use it for feed. Table 1 shows the maize area, productivity and yield across the world. It shows that the USA is dominating first place in the area and production, around 34 % in the world, followed by China 22.41% and Brazil 7.17%. In comparison, India ranks seventh in terms of area and production, around 2.42 %, next to Indonesia.

Source: Authors estimation, 2023. Table 1: Maize Area, Production and yield in various countries.

Price trend of Maize in India

Figure 1 shows the harvest price trend of maize in India. The price of maize has increased gradually over the year. During the period of 2001-02 harvest price for maize was around Rs. 499 per quintal. The advancement of new varieties, as well as modern technology practices, has bought systematic changes in the price level. Recently, the harvest price for maize is around Rs. 1876 per quintal. The steady price increase is a positive motivation for poverty-ridden maize producers so that they can produce more in the coming years.

Click to enlarge

Source: Authors estimation, 2023. Figure 1: Price trend of Maize in India.

Maize Exports

Figure 2 represents India’s top 5 export destinations in terms of poultry products. Maize production has increased remarkably in the last two decades. The food grain basket is self-sufficient after the green revolution. The surplus of maize crops has been used for poultry feed. In recent years, the demand for chicken has increased in low-income groups.

As a result, maize crops is used for poultry feed to meet the demand for chicken meat. The top five countries are major export destinations such as (Oman 36%), followed by (Maldives, 23%), and (Indonesia, 16%). While, (Vietnam, 14%) and (Russia, 11 %) are also the major destination for poultry products. The rise in export volume has a positive impact on balance of trade.

Click to enlarge

Source: Authors estimation, 2023. Note: figures are in percentage. Figure 2: Top Poultry Products Export destinations in India for the year 2020-21.

Trends of Poultry Population in India

Poultry refers to the domestication of birds that produce eggs and meat that can be consumed and commercial traded by farmers. India’s poultry population has considerably grown over the last two decades to meet the growing demand for eggs and meat. In the livestock sector, poultry is one of the most efficient enterprises for the rural areas’ low and marginal-income groups. The poultry industry provides cheap sources of high-quality proteins, minerals and vitamins to balance the human diet. Table 2 represents poultry population in India, among the states of India, Tamil Nadu has a higher number poultry population of around (120.8 million) followed by Andhra Pradesh (107.9 million) and Telangana (80.0 Million). While Odisha (27.4 million) and Kerala (29.8 million) poultry population. The total poultry population in the county is 851.8 million in 2019, and it increased by 14.39 % over 2012. The livestock report shows that the total commercial poultry in the country is 534.74 million in 2019, which increased by 4.5% over 2012 [9]. The increasing poultry population is hugely depending on the supply of poultry feed. Poultry feed mostly comes from maize crops. Thus, there is ultimately a demand for maize production. The sustainable development of the poultry sector can play a key role in achieving UN sustainable development goals. It can directly or indirectly improve the livelihood of millions of people.

Source: Authors estimation, 2023. Table 2: Major Poultry Population in India.

Extent of Maize Production in India

The compound annual growth rate of different states was calculated the study status of maize production. The study period was considered to be from 2009–10 to 2019–20. The CAGR statistics revealed that the cropped area under maize has increased in all the states except Gujarat, Rajasthan, and Uttar Pradesh. The highest growth in the cropped area was in West Bengal (12.04% annual), while the lowest was in Andhra Pradesh (0.3% annual). Further, the productivity growth rate in all states shows that Tamil Nadu was at the top of the list, while Karnataka was last among the states. Maharashtra states shows that the decrease in the maize yield i.e., 24.52q/ha in TE-2009-10 to 21.74q/ha in TE-2019- 20 (Table 3).

Source: Authors estimation, 2023. Table 3: Major maize producing states in India.

Sources of Growth in Maize Yield: Decomposition Analysis Results

Figure 3 depicts the decomposition analysis results of maize production in terms of area, yield, and interaction effect. The sources of growth for Andhra Pradesh show that the yield effect (i.e., 86.66%) was most responsible for increasing the production of maize, while the area effect contributed a negligible amount. All the major maize production states revealed that the maize production growth due to the yield effect or technological intervention, which shows that more than 45% effects except Maharashtra, West Bengal and Karnataka. While the area effected maize growth in the states of Maharashtra, West Bengal, Telangana and Karnataka. In order to increase the production in maize growth in the area effected states needs to be technological development and its proper implementation [10, 11].

Click to enlarge

Source: Authors estimation, 2023. Figure 3: Sources of Growth in Maize Production.

Further, the yield effect in production in Gujarat was the highest among the states (i.e., 175.93%), while it was lowest in West Bengal (i.e., 16.43%). It is also reported in Figure 3 that the area under maize is substantially increased, and the area effect contributes about 154.12% to the production of maize. In India, the contribution of the yield effect was

61.28%, while the area effect contribution was only 29.12%. Figure 4 revealed that the consumption percentage of maize has been increased over the year in the states of India due to the growing demand of food pattern and urban living style of people [8, 9].

Click to enlarge

Source: Authors estimation, 2023. Note: figures are in percentage. Figure 4: Change in share of maize consumption in 2013-14 and 2018-19.