Profit Efficiency Of Small – Scale Rice Farms In Patigi Local Government Area Of Kwara State, Nigeria

Abstract

This study examined the profit efficiency of small-scale rice farms in Patigi Local Government Area of Kwara State, Nigeria. Data for the study came from structured questionnaire administered to 150 small scale rice farmers in the study area selected through a three-stage sampling technique. The Cobb-Douglas - Stochastic Frontier Profit Function, Descriptive statistics, and Gross margin analyses were used to analyse the data. Findings showed that 88.7% are males, married and have a mean age of 40 years. Only 33% of the respondents have access to credit facilities. The result of the gross margin analysis showed that average gross margin and Net return are #50,985.12, and #41,112.88 respectively. The return per Naira invested is #1.79 which implies that for every #1 spent. 0.79k is returned as profit. Result of the stochastic frontier profit efficiency showed that the mean profit efficiency is 77% showing that there is still room for improvement. The major constraints faced by the rice farmers are inadequate capital, high cost of labour, lack of credit etc. The study therefore recommends that the government formulates agricultural-improving policies that will solve the major constraints observed in the study to ensure profitable rice production in the study area.