Economic Efficiency of Cocoa Production in Gashaka Local Government Area, Taraba State, Nigeria

Abstract

The study was carried out to analyze the Economic Efficiency of Cocoa Production in Gashaka Local Government Area of Taraba State, Nigeria. Data for the study were collected from 80 respondents in 2012 using multi-stage sampling techniques and were analyzed using budgeting technique and profit function. The gross income per hectare was estimated to be ?53, 250.00 while the total production cost per hectare was estimated to be ?116, 470.00, giving a gross margin per hectare of ?64, 005.00. The net farm income was estimated to be ?35, 780.00. Purchasing costs accounted for 72.9% of the total production cost with an average cost of ?851/kg. The Rate of Returns on Investment (RRI) was ?0.75. Profit function result revealed that, labour cost and herbicide have negative relationship with the estimated profit, while cost of cocoa seed and fertilizer were found to be inversely related to profit. Major production constraints associated with cocoa production identified were inadequate support on research (20%), inadequate farm tools (19%) inadequate credit (17%) and lack of storage facilities (16%). The study recommended among others that strengthening of extension services and subsidization of farm inputs could improve farmers’ profit margin in cocoa production.

DOI: 10.5901/mjss.2015.v6n1s1p570