An analysis of tea production in Tanzania: 1961-1984: a case of private estates: the Northern areas

This study attempts to establish the factors affecting tea production in the private sector in the Northern area particularly for Bangalai, Herkulu, Ambangulu, Dindira , Marvera and Karimi tea estates. The study employed both qualitative and quantitative methods of analysis. Qualitative involved both statistical and econometric techniques. The variables included in the models are:- tea output, land measured in hectares, producer price, labour and time ( a proxy of change in technology, improvement in marketing, distribution and transportation and monetisation of the economy). In econometric analysis single equation models were constructed. Statistically, time appear to be important factor in tea production. The coefficients of labour and land have expected signs in most of the regression lines. The coefficients of nominal price are significant in most of the regression lines. The coefficients of real price are statistically insignificant with positive sign in most of the regression lines. The tea supply elasticity ( logqti/logP) of the Ith private estate, have the following policy implication, (i) of the price responsiveness to tea production policy, In order the target on tea production ( as projected by MDB) to be achieved the changes in producer price should be increased in the same way with planned tea output increases. (ii) of responsiveness to pricing policy, in the present, tea pricing system in Tanzania is carried out with attention to the world tea market situation and operation costs of Tanzania Tea Authority. The producer price should be high enough to bring the planned tea output level. (iii) of price responsiveness to public finances. If the government takes from private estates farmers in form of taxes, the less will be available to the farmers. If taxes are too high they could either discourage private estates farmers from expanding their tea production or leave the farmers with small profit margin as to make them unable to carry further investment and rehabilitation of factories. The statistical results in the chapter four indicate a positive response for tea production in private estate to non-price variables in some regression lines, for instance:- (logQt/logH)= 1.73726, (logQt/logL)= 0.814 and ( logQt/logT) = 0.2.01 where Qt, H, T and L stands for tea output, hectares, time and labour respectively, This responsiveness indicates that, price policy