Economic Efficiency of Groundnut Production in the Central Dry Zone of Karnataka: A Data Envelopment Analysis Approach

Background: Groundnut is an important oilseed crop in Karnataka, particularly in the Central Dry Zone, where variations in input utilisation, cultivation costs and productivity influence farm profitability. Limited comparative evidence on technical, allocative and economic efficiency among groundnut farmers in Chitradurga and Tumakuru districts highlights the need to assess resource-use efficiency and identify opportunities for improving economic performance. Aims: To evaluate the technical, allocative and economic efficiency of groundnut production in the Central Dry Zone of Karnataka and identify key inefficiencies in resource use among farmers in Chitradurga and Tumakuru districts. Study Design: A cross-sectional study based on farm-level primary data analysed using Data Envelopment Analysis (DEA) under constant returns to scale with input orientation. Place and Duration of Study: Challakere and Molakalmuru taluks of Chitradurga district and Sira and Pavagada taluks of Tumakuru district, Karnataka, during the 2022–2023 agricultural year. Methodology: A total of 120 groundnut farmers (30 from each taluk) were selected through random sampling. Primary data were collected using structured interviews covering input use, labour and costs. DEA was employed to estimate Technical Efficiency (TE), Allocative Efficiency (AE) and Economic Efficiency (EE) for each farm. Cost and return analysis was also conducted to assess profitability. Results: The mean TE, AE and EE scores in Chitradurga district were 0.81, 0.64 and 0.52, respectively, while those in Tumakuru district were 0.80, 0.68 and 0.54. Tumakuru farmers achieved higher average yields (6.37 quintals/acre) and gross returns (₹48,192/acre) than Chitradurga farmers (4.96 quintals/acre and ₹38,848/acre). Returns per rupee of variable cost were 1.41 and 1.15 for Tumakuru and Chitradurga, respectively. Variable costs accounted for over 70 per cent of total costs, with human labour and seed costs being the largest components. Conclusion: Although most farmers demonstrated reasonable technical efficiency, considerable scope remains to improve allocative and economic efficiency. Better access to cost-effective inputs, extension services and training in resource allocation may help optimise production and improve profitability in Karnataka's dryland groundnut farming systems.