Comparative Economic Analysis of Upland And Lowland Rainfed Rice Production In Selected Local Government Areas of Kaduna State, Nigeria.
ABSTRACT
This research carried out a comparative economic analysis of upland and lowlandrainfed rice production in selected local government areas of Kaduna state, Nigeria.
The study set out to compare the profitability and efficiency of resource use in upland andlowland rainfed rice production. A multistage sampling technique was used to select 75upland and 150 lowland rice farmers .
Primary data were collected using structuredquestionnaire. The data were analyzed using descriptive statistics, stochastic frontierproduction function, gross margin analysis, return on investment and student t test.
The result showed that rice productions were more dominated by male farmers in the uplandwith 89% than the lowland with 75% .
The upland rice farmers participated more thanthe lowland farmers in years of schooling with 78% and 17% schooling for more than13 years respectively.
The lowland farmers had more experienced in rice cultivationthan upland farmers with about 5% and 3% cultivating the crop for more than 30 yearsrespectively.
The upland rice farmers had more farm size than lowland farmers withaverage of 1.47 hectares and 1.30 hectares respectively.
The lowland rice farmers hadmore household size than upland farmers with average of 9 and 8 people respectively.The lowland rice farmers comprise of older people than the upland farmers with meanage 43.75 and 40.75 years respectively.
TABLE OF CONTENTS
Title page ……………………………………………………………………………….. i
Declaration …………………………………………………………………………….. ii
Certification …………………………………………………………………………… iii
Dedication ……………………………………………………………………………….. iv
Acknowledgement ……………………………………………………………………….. v
Tables of Contents ……………………………………………………………………. vii
List of Tables …………………………………………………………………………….. x
List of Figures ………………………………………………………………………….. xi
List of Appendices …………………………………………………………………….. xii
Abstract ……………………………………………………………………………….. xii
CHAPTER ONE ……………………………………………………………… 1
1.0 INTRODUCTION ……………………………………………………………… 1
1.1 Background to the Study ………………………………………………………. 1
1.2 Problem Statement ……………………………………………………………… 3
1.3 Objectives of the Study ………………………………………………………… 5
1.4 Hypotheses of the Study ……………………………………………………….. 6
1.5 Justification for the Study ……………………………………………………… 6
CHAPTER TWO ……………………………………………………………… 9
2.0 LITERATURE REVIEW ……………………………………………………… 9
2.1 History of Rice Production in Nigeria …………………………………………. 9
2.2 Rice Agro-Ecological zones in Nigeria ………………………………………. 11
2.2.1 Rainfed upland rice …………………………………………………………… 12
2.2.2 Rainfed lowland rice ………………………………………………………….. 12
2.3 Importance of Rice Production in Nigeria ……………………………………. 13
2.3.1 Rice as a staple food ………………………………………………………….. 13
2.3.2 Rice for food security ………………………………………………………… 14
2.3.3 Rice for poverty reduction ……………………………………………………. 15
2.4 Production and Economic Importance of Rice in Kaduna State ……………… 16
2.5 The Concept and Measurement of Efficiency in Agriculture ………………… 17
2.5.1 The stochastic production frontier function …………………………………… 17
2.5.2 Data envelopment analysis (DEA) …………………………………………… 21
2.5.3 Tobit regression model ……………………………………………………….. 24
2.5.4 Importance and application of efficiency studies in agricultural research …… 25
2.6 Measurement of Profitability …………………………………………………. 28
2.6.1 Net farm income ……………………………………………………………… 28
2.6.2 Gross margin ………………………………………………………………….. 28
CHAPTER THREE …………………………………………………………. 29
3.0 RESEARCH METHODOLOGY …………………………………………….. 29
3.1 Study Area ……………………………………………………………………. 29
3.2 Sampling Procedure and Sample Size ………………………………………… 32
3.3 Data Collection ……………………………………………………………….. 33
3.4 Analytical Techniques ………………………………………………………… 34
3.4.1 Descriptive statistics ………………………………………………………….. 34
3.4.2 Stochastic frontier production function ………………………………………. 34
3.4.2.1 Techef Technical efficiency measurement ………………………………….. 35
3.4.2.2 Allocative efficiency measurement …………………………………………. 36
3.4.2.3 Economic efficiency measurement ………………………………………….. 37
3.4.3 Profitability analysis ………………………………………………………….. 38
3.4.3.1 Gross margin analysis ……………………………………………………… 38
3.4.3.2 student t-test ………………………………………………………………… 39
3.5 Measurement of Variables ……………………………………………………. 40
CHAPTER FOUR …………………………………………………………… 45
4.0 RESULTS AND DISCUSSION ……………………………………………… 45
4.1 Socio-Economic Characteristic of Rice Farmers ……………………………… 45
4.1.1 Distribution of respondents by sex …………………………………………… 45
4.1.2 Distribution of respondents according to major occupation ………………….. 45
4.1.3 Distribution of respondents according to educational attainment ……………. 47
4.1.4 Distribution of respondents by farm size ……………………………………… 48
4.1.5 Distribution of respondents according to household size …………………….. 49
4.1.6 Distribution of respondents according to age ………………………………… 50
4.1.7 Farming experience in upland and lowland rice farming …………………….. 51
4.1.8 Credit accessibility by the upland and lowland rice farmers …………………. 52
4.1.9 Reasons for cultivating rice …………………………………………………… 53
4.2 Technical Relationship between the Inputs and Outputs of the RiceProduction Systems……… 54
4.2.1 Estimation of stochastic frontier production model ……………………………54
4.2.2 Return to scale in upland and lowland rice production ………………………. 59
4.2.3 Estimation of technical inefficiency model …………………………………… 60
4.2.4 Estimation of the allocative stochastic frontier model ……………………….. 65
4.2.5 Estimation of allocative inefficiency model ………………………………….. 71
4.3 Technical, Allocative and Economic Efficiencies of the RiceProduction Systems ……… 76
4.3.1 Technical efficiency distribution ……………………………………………… 76
4.3.2 Allocative efficiency distribution …………………………………………….. 77
4.3.3 Economic efficiency distribution ……………………………………………… 78
4.4 Profitability Analysis for Upland and Lowland Rice Production …………….. 79
4.5 Constraints in rice Production ………………………………………………… 85
CHAPTER FIVE ……………………………………………………………. 89
5.0 SUMMARY, CONCLUSION AND RECOMMENDATIONS ……………… 89
5.1 Summary ……………………………………………………………………… 89
5.2 Conclusion ……………………………………………………………………. 92
5.3 Recommendations ……………………………………………………………. 92
5.4 Contribution to Knowledge …………………………………………………… 94
References ………………………..96
INTRODUCTION
Background to the Study
Rice is a major commodity in world trade and a staple food for about 2.6 billion peoplein the world.
The global output showed that the Asian continent accounted for about92%, America and the Caribbean accounted for 5% and 3% for Africa (Spore, 2005).
Insub-Saharan Africa, West Africa is the leading producer and consumer of rice with63.4% and 69.1% of total rice production and consumption respectively (WARDA,2007).
Three African countries are among the twentieth world highest producer of rice.Nigeria is the nineteenth highest producer of rice in world surpassed only by Egypt and Madagascar in Africa.
It has been reported that Nigeria, Egypt and Madagascarproduced 3218760, 4329500 and 4737970 metric tonnes of rice respectively (FAO2010).
In the entire continent of Africa, it is reported that only Egypt and Madagascarhave attained self sufficiency in local rice production, all other countries have rice demand exceeding local production (FAO, 2008).
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