| Tanzania is the second largest rice producer in Eastern, Southern and Central Africa, and most of the rice consumed is produced in the alluvial lowlands, coastal plains, along bottom valleys of mountains, and land depressions as well as along river-valley basins within the country. It is estimated that over 400,000 hectares are under rice cultivation in various parts of the country. Tanzania has the potential to increase its rice production through improved yields. Currently the yield for rice is at 15.35tonnes/ha, which is low relative to India(32.6tonnes/ha) and the world average(43.7 tonnes/ha).This study used Tanzania National Panel Survey(NPS) data compiled by FAO, whereby a sample of 842 households from high rice producing regions(Mbeya, Morogoro, Shinyanga, Mwanza and Tabora) was extracted from the dataset. The objectives were to analyze smallholder rice farmers’ socio-economic determinants for input use, factors influencing the quantity of rice sold by smallholder farmers and determinants of smallholder farmer’s market participation. Quantitative as well as quantitative analyses were performed; quantitative analysis involved estimation of Probit, WLS and Tobit econometric models and results were obtained using probit, vwls and tobit commands from STATA 12 software respectively.Based on these study findings, it can be concluded that, the possibility of using agricultural inputs increases with the increase in education level, quantity of rice produced, possession of livestock, farm income, and household been located in Shinyanga region for rice. However, it decreases with increase in number of livestock and nonfarm income owned by a household. The results further suggest that age of the household head, gender of the household head, and marital status of the household head and size of land owned by the household were insignificant, meaning that in the study area, farmers were not influenced by these factors on the use of agricultural inputs in rice production.. The coefficient for education level had a positive sign and statistically significant. This signifies that education level had a positive influence to smallholder’s farmer’s use of inputs rice production.Consequently the hypothesis that human capital plays a positive role in the acquisition and evaluation of new ideas is supported because programs and materials promoting technological change typically favour literate farmers. The positive sign of quantity of rice produced indicated that the size of land/production was also statistically significant and positively influencing smallholder’s farmer’s use of inputs in rice production. Farm income had a positive effect for the utilization of agricultural inputs by smallholder’s farmers suggesting that gross farm income from sale of produce is the major source of funds for most farmers. Hence the higher income accrued from crop sales the more likely farmers can re-invest part in innovations. The coefficient for total number of livestock has a negative effect for using agricultural inputs by smallholder’s farmers and is statistically significant for rice farmers. This implying that, a unit increase in total number of livestock owned by a household decreases the probability of farmers using inputs. However, it does not support the fact that livestock can be affected in two ways: direct effect; that farmers can sell their livestock and get cash to buy inputs and indirect effect; that livestock can serve as collateral for fertilizer credit. On the other hand, it support the fact that, the intensive animal husbandry may reduce demand for conservation agriculture technologies because crop production becomes a secondary enterprise hence it is given low priority for investment when it comes to new innovation. Therefore, number of livestock such as cattle may have a positive or negative effect on use of these technologies.Moreover, nonfarm(off-farm) income has a negative effect for the use of agricultural inputs by smallholder rice farmers. However, the negative and insignificant estimate for rice farmers could be attributed to the higher relative returns from other nonfarm investments and when nonfarm enterprises have higher returns, then smallholder’s farmers might prefer to invest in options that have better returns, given the risk involved in agriculture. Therefore, agricultural income should exceed off-income for farmers to be motivated to invest in the use of agricultural inputs. Furthermore, in assessing the effect of farmers’ location on the use of agricultural input, the findings suggests that among the five regions included in the Probit model, Shinyanga region has a positive and significant effect on rice farmers input use. This finding may be due to the fact that, in Shinyanga region rice production is mainly rain fed whereby fertilizer is mainly used for fast tracking the growth of seedling so that transplantation can be done within the short rain season but not after seedling transplanting.Moreover, the study found that small holder rice farmers’ level of sales and market participation are constrained by a number of factors; such as socio-economic, technological and institutional factors, these may include low level of education which may lead to inadequate access to extension services, low use of improved seed and application of fertilizer which leads to small marketable surplus, poor infrastructure(rural roads, irrigation schemes and market). The study recommended that, in order to raise the use of agricultural fertilizer among smallholder farmers, policy makers and development agencies should put more efforts on developing and implementing sustainable strategies that shall lead to improved access to input and output markets. Through improved market infrastructures and agricultural price policies, smallholder farmers like price incentives that increase their farm income and lead to investment in improved agricultural technologies such as improved use of agricultural inputs and post-harvest management techniques. However, inputs trade regulations need to be reviewed to address the issue of higher costs due to unavailability of inputs by doing so it may increase access to input by small holder famers.Accordingly, smallholder rice farmers’ participation in markets upgraded more from subsistence farming into commercial farming hence their income from agriculture will be increased and rural poverty will be alleviated. It is the believe of the researchers that, when the above recommendations are carefully considered and implemented, Tanzania’s rice sector and other food crops production, productivity and marketing will be improved, hence, the food security and livelihood of the rural poor who mostly depend on agriculture will be improved.
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