Thesis Abstract

<p>&nbsp;                        <b>ABSTRACT&nbsp;</b></p><p>The broad objective of the study was to examine the Economics of Sesame Production among small-holder famers in Benue State, Nigeria. Specifically, the study examined the socio-economic characteristics of farmers in the study area, profitability, technical, allocative and economic efficiencies and constraints of sesame production in the study area. A multi-stage sampling procedure was used to randomly select 180 farmers from 12 villages in the state. Primary data were collected using structured questionnaire and analyzed using net farm income and stochastic frontier production function. The results revealed that majority (85.6%) of the farmers were male with a mean age of 37. About 97.8% of the respondents were literate with a mean farm size of 3.13 hectares. The gross farm income, net farm income per hectare and the return per every naira invested were found to be of N121, 435.20, N67,261.95 and N1.24. Labour was the most prominent cost item and it accounts for 57.85% of the total cost. The estimate of the technical efficiency indicates that farm size was positive and statistically significant at 1% while the coefficients for fertilizer and herbicide were statistically significant at 5% and 10% level of probability. Farming experience, extension contact and membership of cooperative society were found to influence technical efficiency. The analysis of allocative efficiency revealed that seed, fertilizer and herbicide were all statistically significantly at 1%. The inefficiency model indicates that education, farming experience and extension service were significantly related to allocative efficiency. The mean technical, allocative and economic efficiencies estimates were 0.712, 0.968 and 0.689 respectively. The major problems encountered by the sesame farmers in the study area were inadequate capital (80.5%), poor market pricing (76.7%) and lack of modern cleaning facilities (73.9%). There is a need for farmers to form cooperative organisation so as improve their access to production inputs and enhance their marketing efficiency. Also, strengthening the present extension service will increase efficiency in the long term. <br></p>

Thesis Overview

<p> <b>INTRODUCTION&nbsp;</b></p><p><b>1.1 Background to the Study&nbsp;</b></p><p>Available statistics show that agriculture is the most important Nigerian economic sector in terms of its contribution to the Gross Domestic Product (GDP), after oil. The sector contributes about 41% to the country‟s GDP, employs about 65% of the total population and provides employment to about 80% of the rural population. Agriculture is a major source of food and meat. It is estimated that some 25 million hectares of land are cultivated each year by small holders for food production and hence the sector plays an important role in rural livelihood. It is estimated that it accounts for about 70% of rural household‟s total incomes (Ogen, 2003). Agricultural growth in Nigeria is increasingly recognized to be central to sustained improvement in economic development. The sector plays a crucial role in food security, poverty alleviation and human development chain in Nigeria (Aye and Oboh, 2006). According to the Department of Agriculture, Forestry and Fisheries (2012), Smallholder farmers are defined in various ways depending on the context, country and even ecological zone. It is often interchangeably used with „small-scale, „resource poor‟ and sometimes „peasant farmer‟. In general terms smallholder only refers to their limited resource endowment relative to other farmers in the sector. It can be defined as those farmers owning small-based plots of land on which they grow subsistence crops and one or two cash crops relying almost exclusively on family labour. One of the main characteristics of the production systems of smallholder farmers are simple outdated technologies, low returns and high seasonal labour fluctuations. These smallholder farmers differ in individual characteristics, farm size, resource distribution between food and cash crops, livestock and off-farm activities, their use of external inputs and hired labour, the proportion of food crops sold and household expenditure patterns (DAFF, 2012).&nbsp;</p><p> In Nigeria, small-holder farmers constitute about 80% of the farming population (Awoke and Akorji, 2004). According to them, small-holder farmers are those farmers who produce on a small scale, not involved in commercial agriculture but produce on a subsistence level, and cultivate less than five hectares annually on the average. Smallholder and family farming agriculture remains the key and leading sector in economic development of many developing countries in the world (Quan, 2011). According to Quan (2011), in addition to producing staple food for domestic markets, small-holder farmers produce larger share of traditional export in these countries, hence, the economy of many developing countries is still reliant on small-holder agriculture. The agricultural sector in Nigeria is dominated by small-holder farmers who produce the bulk of the food requirements in the country (Asogwa, Umeh and Penda, 2011). <br></p><p> Sesame (Sesamum indicum L.) otherwise known as sesamum or benniseed, a member of the family padaliaceae, is one of the most ancient oil seed known to mankind. Sesame plays a major role in human nutrition. Most of the sesame seeds are used for oil extraction and the rest are used for edible purposes (El Khier, Ishag and Yagoub, 2008). Sesame is widely grown in the northern and central part of Nigeria as a minor crop initially until in 1974 when it became a major cash earner in many northern states such as Benue, Nasarawa, Jigawa, Kano, Katsina, Plateau and Yobe States and in Abuja, the Federal Capital Territory of Nigeria (NAERLS, 2010). Sesame is commonly grown by small-holder farmers in the major producing States of Benue, Nasarawa and Jigawa States.<br></p><p> Sesame has been reported to be a typical crop for farmers in the developing countries (Bennet, 2011). This is because it has deep roots and is well adapted to withstand dry conditions. It grows on relatively poor soils in climate generally unsuitable for other crops, and so it is widely valued for its nutritional and financial yield. It is well suited to small-holder farming with a relatively short harvest cycle of 90 – 140 days, allowing other crops to be grown in the field (Chemonics, 2002; Naturland, 2002; Nigeria‟s Harvest, 2009) and often intercropped with other grains. This makes it favourable to Nigerian farmers. Production can thus be sustained by small-holder farmers under minimum management with average yield of 700kg per hectare (Nigeria‟s Harvest, 2009). The three major languages in Nigeria, Hausa, Igbo and Yoruba call it Ridi, Isasa and Ekuku respectively.&nbsp;</p><p>1.2 Problem Statement Sesame seed is an important component of Nigeria‟s agricultural export (Chemonics, 2002). It currently ranks second to cocoa in terms of export volume in Nigeria and is fast becoming prominent among non-oil exports because it is one of the few cash crops that can earn the country foreign exchange. Attributed to its high demand, any quantity of the product offered to the market is easily sold. Although it is quite extensively cultivated, it is mainly a small-holder crop, often intercropped with others crops (Abu et al. 2011). Available records showed that Nigeria exported 140,800 tonnes of sesame seed worth $139 million in 2010. It was also recorded that Nigeria earned N210 billion from the export of sesame seed products in the first half of 2012 (Ciuci, 2013).&nbsp; This increasing demand for sesame seed provides Nigeria an opportunity to increase its production to meet the international demand for the commodity. Market opportunities exist in Korea, India, the Middle East and Mediterranean countries where sesame seed oil is in very high demand (Ciuci, 2013). This therefore provides Nigeria with the opportunity to broaden its market base. Currently only about 300,000 hectares of the estimated 3.5 million hectares of Nigeria‟s 90 million hectares of arable land that is suitable for cultivating sesame seed is presently being used in the production of sesame seed (Tunde-Akintunde et al. 2012). By investing more in sesame seed production, the Nigerian government could increase annual revenue from sesame seed export from N21 billion to about N86 billion annually (Ciuci, 2013). <br></p><p> The realization of the potential of sesame production in the acquisition of foreign currency for the country made increased production of the crop a prominent priority in the Agricultural Transformation Agenda of the Federal Government of Nigeria. To this end, farmers are being encouraged to produce sesame in all agro-ecological zones of the country. Nigeria has the technology to produce significant output of sesame for export in view of the yield potentials of the varieties released to farmers (NCRI, 2012). However, some studies on sesame indicated a wide gap between potential and actual yields obtained (RMRDC, 2004, Olowe, 2007; NAERLS, 2010; Kanton et al., 2013). The NAERLS (2010) reported actual sesame yield of 300kg/ha against potential yield of between 700-1,000 kg/ha which is below the world average yield of 4,900kg/ha and four times lower than the average yield of other oil seed crops like groundnut and soybean. Manyong et al. (2005) reaffirmed actual sesame yield of 0.55 tonnes/ha against a potential yield of 2 tonnes/ha with a yield gap of 264% for North-Central Nigeria.&nbsp;</p><p>Nigeria‟s inability to fully tap into the economic potentials of the crop might be a reflection of its inefficient nature in sesame production. One of the major factors responsible for low agricultural productivity in Nigeria is farmers‟ limited access to production inputs which are necessary for attaining a high level of production (Nwaru, 2004). Amaza and Olayemi (2002) observed that crop farmers mostly carry out their production under conditions involving the use of inefficient tools and unimproved seed varieties and therefore, maximum efficiency is elusive to them. Productivity according to Coelli et al. (1998) is a measure of farm performance which indicates whether a farm uses the best available technology to obtain maximum output from a given set of inputs. On the other hand, technical efficiency is the ratio of total output to total inputs; the larger the amount of inputs per unit of output, the smaller the size this ratio becomes (Ohajianya and Onyenweaku, 2001). <br></p><p> Sesame is extensively cultivated in Benue State but there is little information on the productivity as well as the efficiency of resources used and profitability. One way farmers can raise productivity is improving the efficiency within the limit of the existing resource base and technology (Udoh, 2005). Productivity is reduced in the presence of technical inefficiency whereas the more efficient the firm, the higher its productivity, ceteris paribus (Kumbhakar, 2004). Boosting sesame production would require that farm resources be use efficiently since efficiency in the use of the production inputs is essential for optimum production. Therefore, there is the need to assess the level of efficiency of resources used in agricultural production in general and sesame production in particular. This therefore, necessitates answers to the following research questions: <br></p><p> i. What are the socio-economic characteristics of sesame producers?</p><p>&nbsp;ii. Is sesame production profitable?&nbsp;</p><p>iii. Are the resources efficiently utilized?&nbsp;</p><p>iv. What are the constraints associated with sesame production in Benue State?&nbsp;</p><p><b>1.3 Objectives of the Study&nbsp;</b></p><p>The broad objective of the study was to examine the economic efficiencies of sesame production in Benue State.The specific objectives were to: i. describe the socio-economics characteristics of farmers in the study area; ii. determine the cost and returns in sesame production; iii. estimate the economic efficiency in sesame production; and iv. describe the constraints associated with sesame production in the study area. <br></p>