Assessing the efficiency of smallholder wool farmers in the changing paradigms of the Free State province of South Africa

The South African population is predicted to increase to almost 66 million by 2030. This necessitates paradigm shifts to improve agricultural efficiency. However, South African wool production has continuously declined over the past three decades. The study analysed the efficiency of smallholder wool farmers and identified the determinants of technical inefficiency in wool production in Thaba ‘Nchu and Botshabelo in the Mangaung Metro (Free State province, South Africa). A multistage sampling technique was used to select 351 participants. A stochastic frontier model was employed to analyse the efficiency of wool farmers. The results indicate that increases in feed and veterinary costs negatively affect the efficiency of smallholder wool production. Wool quality and use of social media were found to have a negative and statistically significant influence on the variation in the inefficiency of wool production (i.e., as these variables increase, inefficiency decreases). Poor extension services and poorly managed farmers’ associations increase the inefficiency of smallholder wool producers. Furthermore, only 7% of smallholder farmers were efficient, and most smallholder wool farmers were not producing at full capacity; there is thus much room to improve production. To increase the efficiency of smallholder wool production in Mangaung, it is recommended that farmers are trained to improve the quality of their wool and, consequently, increase the wool price. Further recommendations include improvement of extension services, better management of farmers’ association