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Financial benefits from Eucalyptus woodlot growing can surpass staple crop production; nevertheless, the reasons for this shift and its potential impacts on income diversification remain largely unknown in the highlands of Ethiopia. Using a binary logistic regression model, the study aimed to evaluate the factors influencing the conversion of cropland to Eucalyptus camaldulensis woodlots. The independent t-test and the Simpson Diversity Index were used to evaluate the impact of transition on income diversification. Quantitative data gathered from 337 randomly chosen household heads were used in the analysis. Results revealed that market demand for E. camaldulensis woodlot, plot accessibility to a transportation route, declining cropland productivity, more saving potential, and total land holding size significantly influenced the decisions of farmers to convert their croplands into E. camaldulensis woodlot. Woodlot adopters diversified their source of income by 49.4 % compared to non-adopters, implying that eucalyptus woodlot plantings can be more preferred to income improvement than crop production. Policy makers must pay attention to important factors that significantly influence the decisions that farmers make about the conversion of croplands into E. camaldulensis woodlots. Increased growth in woodlots with balanced cropland output through a sustainable land management approach is required to increase the diversification of income among farmers.
Ermias Debie (Sun,) studied this question.