Economics of Groundnut (Arachis hypogaea L.) Production in Bali Local Government Area of Taraba State, Nigeria

Abstract

The study was carried out to analyze the economics of groundnut (Arachis hypogea L.) production in Bali Local Government Area of Taraba State, Nigeria. Multistage sampling technique which involves purposive selection of five wards from Bali LGA and simple random selection of 75 farmers from five wards were employed in collecting primary data using structured questionnaire. The data collected were analyzed using descriptive statistics, farm budgeting and regression analysis. The result showed that the mean age of the farmers was 35 years, 66.7% were married, 61% were female and 78% of the ground nut farmers had one form of education or the other. The mean years of farming experience was 6 years, the mean household size was 6 persons and the mean farm size was 2 ha. The analysis found that the total cost of producing groundnut per hectare was N170,610 and the gross margin was N 90,070. The profit of N75,040 was actualized with a benefit cost ratio of N1.44. The regression analysis indicated that Cobb-Douglas production function gave the best fit with R 2 value of 0.64. The coefficients of fertilizer (2.2301), farm size (1.5795) and labour (0.3782) were all positive and statistically significant at varying levels of probability. The coefficient of herbicide (-0.9423) was negative and statistically significant. The result revealed that the most severe problems affecting groundnut production were inadequate finance, lack of improve seed and high cost of labor which were ranked 1 st , 2 nd and 3 rd respectively according to severity. In conclusion, groundnut production was profitable in the study area despite being affected with notable problems. The study therefore recommends investment and participation in groundnut farming by investors as it is a profitable venture. Also, government should establish organized marketing systems to moderate the activities of middlemen which will enhance more profit for the farmers.