ECONOMIC ANALYSIS OF COTTON PRODUCTION AND SUPPLY TREND ESTIMATION IN ZAMFARA STATE, NIGERIA

ECONOMIC ANALYSIS OF COTTON PRODUCTION AND SUPPLY TREND ESTIMATION IN ZAMFARA STATE, NIGERIA

Abstract:

The focus of this thesis was on economic analysis of cotton production and supply trend estimation. The specific objectives described socio-economic characteristics, predicted cotton production trends, described resource utilisation and production technologies and determined profits among cotton farmers. Also, the study estimated the levels of technical, allocative and economic efficiencies, examined the constraints to cotton production and estimated response of cotton supply to price changes in the study area. Primary and secondary data were used for the study. Structured questionnaire was used to collect information from farmers. The list from reconnaissance survey from Zamfara State Agricultural Development Project was used to randomly select 15% of farmers from selected villages of the four Local Government Areas to give a sample size of 220 farmers. The analytical tools used to achieve the stated objectives were descriptive statistics, grafted polynomial models, net farm income model, stochastic frontier models and models with lagged variables. The study found that the mean age of the farmers was 39 years and 30% of the farmers had no formal education while about 74% were married. Also, about 90% were males and having a mean of about 12 years of experience in farming. In resource utilisation and production technologies, about 35% used seed retained from previous planting while 36% procured fertilizers from Agricultural Development Projects. About 41% owned their land through inheritance, 53% used self-financing for their production while 54% used hired labour. The production trends showed that the values of the grafted (mean) function of 123,000 tons were closer to the observed values of 129,000 tons resulting in smaller difference during the sub-period under consideration when compared to the linear values of 137,000 tons. Analysis of net farm income showed a profit of N 51, 414.51/ha if all labour were valued and the returns per man-day of N 966.80 while the returns to investment showed that a farmer gains N 1.11 per Naira invested in cotton production. The input-output analysis showed that the average yield of cotton produced was 773.319kg/ha while return to scale (RTS) was 0.791 depicting a positive decreasing returns to scale and at stage II of the production function. The average technical, allocative and economic efficiency scores were 0.67, 0.64 and 0.44 respectively. The results of cotton production constraints showed that majority of the farmers faced inadequate soil fertility, inadequate loan and credit supply and inadequate market and marketing facilities. The application of models with lagged variables revealed that the coefficients of the explanatory variables in the analysis (Pt), t-1and were significant at 1% and 10% levels of probability for the Nerlovian Adaptive Expectation Model and the Constant Elasticity Adjustment Model. The study showed that socio-economic characteristics and production technologies had meaningful bearings on production. The grafted model gave a satisfactory result since the grafted mean values were closer to the observed values than the linear values while cotton production was profitable and farmers’ productivities were above average. The response of cotton supply to price changes was elastic and satisfactory. It was recommended that adequate and intensive research and extension service delivery programme should pursue a consistent and systematic campaign for cotton production. Efficiency of cotton farmers should be supported by government through timely distribution of inputs. An enabling marketing policy should be instituted by government. This could be achieved through Product Marketing Corporation which would serve as a clearing house for cotton marketing in Nigeria

ECONOMIC ANALYSIS OF COTTON PRODUCTION AND SUPPLY TREND ESTIMATION IN ZAMFARA STATE, NIGERIA

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