EFFICIENCY ANALYSIS OF SMALL-SCALE WOOL PRODUCTION IN THE FORMER TRANSKEL SOUTH AFRICA

A non-parametric data envelopmentanalysis (DEA) is usedto measurethe rc/ative efficiency of wool production on farms in theformer Transkei. The agricultural activities on thefarms are merely non-commercial. Wool is consideredas a by-product of keeping sheep,which are slaughtered on specialfamily occasionsor sold live. A sampleof farmers in three villages of theformer Transkei (Mhlahlane, Xume and Luzie) was interviewed. In Luzie a shearing shed was built to organise the marketing of the wool, leading to a higher revenuefrom wool. The farmers however are not able to convert this into a positive gross margin. A small number of farms succeedsin maximising the production of wool given the relative large investment. The negative result of wool farming on the other farms is partly compensatedby high benefits from the sales of live sheep.Also in Xume a shearing shed was built, and extension on production practices is provided. But no marketing of wool through the shearing shed was done at the time of the survey. The existenceof a shearing shed should be essentialfor a higher retail price for wool and extellsion doeshavea positive influence on the benefitsof the farms. However, the production practices are not adaptedto the production of wool only, so that the useof inputs is too high for thegeneratedoutput.