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WLI 6th Annual Regional Coordination Meeting11-12 November 2014

Amman – Jordan

November, 11th 2014

Boubaker Dhehibi (SEPRP – ICARDA: b.dhehibi@cgiar.org)&

Samia Akrouch (NCARE – Jordan: samia@ncare.gov.jo)

Tools to Guide WLI Community Interventions for Saving Water and

Creating Economic Opportunity

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Thematic Group Background

Reference: WLI technical meeting 05-06 November 2013

Thematic Group: Economics of Natural Resources Management (ENRM)

Research Needs: Assessments of water saving technologies: Cost Benefit Analysis

(CBA)/ saving water (is one important approach to be tackled - e.g. watershed catchment cisterns as the case of Palestine);

Comparison between non-conventional and conventional water use (introduction of some endogenous plants);

Economic valuation of land and water degradation.

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WATER AND LIVELIHOODS INITIATIVE REGIONAL WORKSHOP FOR THE ECONOMICS OF NATURAL RESOURCE MANAGEMENT

24-25 JUNE 2014 – AMMAN - JORDAN

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Workshop Objectives

To provide the WLI researchers specific research concepts and tools for assessing the profitability of improved interventions in the management of NR;

Share, discuss and advance methods on the application of the cost-benefit tool, adaptation and data needs;

Support the WLI national teams with up to date concepts, analytical tools and practical applications to ensure the progress and delivery of research outputs.

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Workshop Structure

The workshop was for sharing, working together and advance WLI socio economic - with the collaboration of biophysical - teams work to achieve planned outputs.

By the end of the workshop, the participants were able to gain:

An understanding of the basic principles of cost-benefit analysis;

Insights into how to quantify costs and benefits; Hands-on practice at building a simple cost benefit model; Proficiency on understanding and analyzing how an

agricultural innovation will be adopted within a given population.

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List of Technologies Implemented by the WLI Team

Country Location Technology Who (names) Institution

Jordan  Jordan Badia

 Marabs

Dr. Samia Akroush NCARE

Palestine Nassarya and Tamun Silage production Dr. Nasser Shaoli NARC

Egypt Old Lands Raised Bed Dr. Sha’aban Al Salem ARC

Iraq Abu Ghraib

Sub-surface Irrigation under protected Agriculture

Dr. Ahmed Adnan Alfalahi

State Board of Agricultural Research (SBAR), MoA

Lebanon El Qaa Conservation Agriculture Eng Randa Massad

Lebanese Agricultural Research Institute (LARI)

Yemen Delta AbyanSupplemental Irrigation of Spate Irrigated Sesame

Dr. Khader Balem Atroosh

Elkod Agricultural Reasearch Station, AREA, MAI

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Tools and Techniques Used in the Guidance Process

Cost – Benefit Analysis Tool

Determine Costs;

Calculate Benefits;

Compare Alternatives;

Report and Plan Action.

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Benefit-cost analysis of technologies using Partial Budget AnalysisWithout technology With technology option

1Costs A B C   Costs D E F

2 Inputs Quantity Unit price Total Inputs Quantity Unit price Total3seeds       seeds      4fert       fert      5pesticides       pesticides      6 labor       labor      7fuel       fuel      8machiney       machiney      9Total XX XX XX Total XX XX XX

10                 11Revenue       Revenue      12Main product       Main product      

13Secondary product      

Secondary product      

14Total revenue XX XX XX Total revenue XX XX XX15                 16 Indicators                17Net returns C14-C9 F14-F9

18 %change in NR (F17-C17/)C17

19 %change in TC (F9-C9/)C920 IRR Change NR/Change in TC21Benefit-cost Ratio   C14/C9         F14/F9

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Key Features of the Partial Budget Form

Simplicity

Transparency- production, prices, etc.

Different professionals (agronomists, economists, farmers can scrutinize)

Provides basic agronomic and economic indicators

Forms the basis for more sophisticated analysis-such as optimal crop allocation and input use (farm models)

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Sorghum vs Lipid Technology in Yemen  Benefit-cost analysis of technologies using Partial Budget Analysis    

     Without technology (Sorghum)       With technology option (Lipid)

1Costs   A B C   Costs   D E F

2 Inputs Unit Quantity Unit price Total   Inputs Unit Quantity Unit price Total3seeds kg/ha 36.0 1.3 45.2   seeds kg/ha 5.0 20.0 100.04 fert kg/ha 60.0 0.7 44.6   fert kg/ha 30.0 0.7 22.35pesticides l/ha 0.0 0.0 0.0   pesticides l/ha 0.0 0.0 0.06 labor man/day 30.0 5.0 151.2   labor man/day 80.0 5.0 403.27 Irrigation m3 7000.0 0.08 542.5   Irrigation m3 5920.0 0.08 458.88machiney hour 7.1 18.6 132.1   machiney hour 7.1 18.6 131.89Total       915.6   Total       1116.1

10                     

11Revenue(Including livestock)

        

Revenue(Including livestock)        

12Main product kg/ha 18000 0.162 2916   Main product kg/ha 398000 0.05 19900.00

13Secondary product 0 0 0 0

 Secondary product 0 0 0 0

14Total revenue       2916

 Total revenue       19900.00

15                     16 Indicators                    17Net returns       2000.38           18783.88

18 %change in NR

              

8.39

19 %change in TC

              

0.22

20 IRR               38.31

21Benefit-cost Ratio   3.18           17.83

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Tools and Techniques Used in the Guidance Process - ADOPT

Predicts the likely peak of adoption and the likely time to reach that peak;

Encourages users to consider the influence of a structured set of factors affecting adoption;

Engages R,D & E managers by involving them in the process and making adoptability knowledge and considerations readily available and understandable.

Sources: Kuehne, G., Llewellyn R., Pannell, D., Wilkinson, R., Dolling, P., Ouzman, J. (2013). ADOPT: the Adoption and Diffusion Outcome Prediction Tool (Public Release Version 1.0, June 2013) [Computer software] Adelaide SA; CSIRO. Available from www.csiro.au/ADOPThttp://aciar.gov.au/files/node/13992/adopt_a_tool_for_evaluating_adoptability_of_agric_94588.pdf

ADOPT: Adoption and Diffusion Outcome Prediction Tool

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ADOPT- Conceptual Framework

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Relative Advantage for the PopulationProfit orientationEnvironmental orientationRisk orientationEnterprise scaleManagement horizonShort term constraints

Learnability Characteristics of the InnovationTrialableInnovation complexityObservability

ADOPT- Conceptual Framework

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Learnability of PopulationAdvisory supportGroup involvementRelevant existing skills & knowledgeInnovation awareness

Relative Advantage of the InnovationRelative upfront cost of innovationReversibility of innovationProfit benefit in years that it is usedFuture profit benefitTime until any future profit benefits are likely to be realisedEnvironmental costs & benefitsTime to environmental benefitRisk exposureEase and convenience

ADOPT- Conceptual Framework

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ADOPT – Practical Case

Focus Group Meeting: WLI Farmers – Badia Jordan (Water harvesting techniques)

Photo Source: Dr Samia Akroush (2014)

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ADOPT – Practical Case

Predicted years to peak adoption 11.9Predicted peak level of adoption 95%Predicted adoption level in 5 years from start 62.9%Predicted adoption level in 10 years from start 94.6%

Predicted Adoption Levels

0

10

20

30

40

50

60

70

80

90

100

0 5 10 15 20 25 30 35 40

Ad

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tio

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Time (years)

Adoption Level S-Curve

Predicted Adoption Curve

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ADOPT – Practical Case

Sensitivity Analysis of Adoption Curve

-2.5

-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22

Ch

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T

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to

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Question Number

Sensitivity Analysis to Step Change of ResponseChange In

Time to Peak Adoption Level Step Up Step Down

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ADOPT – Practical Case

Time to Peak Adoption Level: Constraints

• Size of the up-front cost of the investment relative to the potential annual benefit from using the innovation;

• The proportion of the target population need to develop substantial new skills and knowledge to use the innovation;

• The easiness of the innovation (or significant components of it) be trialled on a limited basis before a decision is made to adopt it on a larger scale;

• Short-term financial constraints determines the time to peak adoption.

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What’s Next1. Technology Adoption Assessment / Scaling-out• Experience with this technology;• Degree of awareness;• Degree of adoption;• Constraints / barriers to adoption;• Requirements for adoption;• Factors influencing / determinants adoption;• Raisons for non-adoption.

2. Sustainability Development Indicators (SDI’s)Without technology: Reference situation (baseline database) and with technology (adopters - at farm level)

Possible Indicators

Economic Indicators: Crop Yields; Farm income (livestock and crops); Production costs, etc.

Environmental indicators: Erosion (soil runoff); Soil salinity; Soil fertility; Pesticide and nutrient use

Social indicators: Revenue per head of family, Hours of labor, Women involvement, etc.

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Thank you for your attention

WATER AND LIVELIHOODS INITIATIVE REGIONAL WORKSHOP FOR THE ECONOMICS OF NATURAL RESOURCE MANAGEMENT

24-25 JUNE 2014 – AMMAN - JORDAN