The Determinant of Profit Inefficiency of Soybean Producers in Niger State, Nigeria

Abstract

This research work examined the determinants of profit inefficiency of soybean producers in Niger State of Nigeria. Multi-stage sampling method was used to sample 216 respondents for the purpose of this research work. Primary data were taken on respondents’ socio-economic factors, cost and return and determinants of profit inefficiency of soybean producers with the use of a questionnaire. The data collected were analyzed with means, frequency counts, percentages, cost and return analysis, stochastic profit frontier and profit inefficiency (SFPF) model. The gross margin was found to be ₦859,376.55 and profit efficiencies of soybean producers in the study area varied from 11.0% to 100.0% with a mean value of 80.4%. Farmland and seed affected soybean profit positively while herbicide and labour affected soybean profit negatively. Producers’ age and access to credit facilities were the major determinants of profit inefficiency. This study concluded that soybean farmers in the area of study were profit inefficient in soybean production. The study recommended that adult and extension education, workshops and seminars should be encouraged and made free among soybean farmers and that Young and experienced farmers should be encouraged to engage in soybean production by providing basic incentives such as credit facilities at low interest rate to increase the profit efficiency of producers.