Technical efficiency and profitability of small holder natural rubber production in southern Nigeria

Abstract

The study measured the technical efficiency and profitability of small holder natural rubber production in southern Nigeria by examining the socio-economic characteristics of respondents, the profitability of latex production and technical efficiency. Multistage, purposive and random sampling techniques were employed in the collection of primary data from 300 respondents. Descriptive statistics and stochastic frontier production function were used to analyse the data collected. Results indicated that respondents were educated, married (76%) with a mean family size of seven people and well experienced mean farming experience of 19 years. Latex production was a profitable venture with an average variable cost per ha of 55,700.94 with total revenue (T.R.) and gross margin (G.M.) per hectare 163,594.17 and 107,893.23, respectively. Furthermore, the stochastic frontier production function analysis showed the number of trees per task, labour, farm size and age of plantation, clone, wage and fixed cost items were significantly related to rubber latex. The mean technical efficiency (T.E.) of the respondents was 0.84. Education, extension contact and experience were the significant factors that increased the technical efficiency of the respondents. The resuscitation of extension activities of A.D.P.s in the rubber growing states of the country through adequate funding by the government to improve the efficiencies of farmers, use of improved planting materials during replanting old plantations and the formation of cooperative societies by farmers to enhance access to production credit amongst others are recommended in the study.