ECONOMIC ANALYSIS OF CASSVA PROCESSING AND MARKETING KOGI STATE, NIGERIA

ABSTRACT

This research work examined the economics of processed cassava products and marketing in Kogi East of Kogi State, Nigeria. Among other objectives the study sorts to: identify and describe different processing/marketing channels of selected the value added chain in cassava processing, and describe the constraints’ seriousness in cassava processing/marketing in the study area. A multistage purposive and random sampling technique was used to select 120 cassava processors/marketers who provided the relevant data for the study through a set of structured questionnaire administered to them. Descriptive statistics, multiple regression, profit function analysis and likert scale rating techniques were employed to analyse the data collected. Results of the study showed that, 66% of the respondents were of middle age between 31-50 years, predominantly females (73%). The majority (67%) of the respondents were married, 37% of the respondents had 5-10 years experience in processing/marketing, and 57% had large family size of about 5 -10 persons. Also 55% of the respondents had between 4-6 persons of their family members directly assisting them in the processing/marketing activities. The study noted that about 50% of the respondents obtained capital from their personal savings while 54% of the respondents source their fresh cassava roots from the market. Additionally, 42% of the respondents had no formal education and 52% indicated that the initial capital they invested was between N20,000 – N39,000. The results also showed that majority (58%) of the respondents in garri processing adopted processing channel which comprised peeling-washing-grating- dehydration-fermentation and frying (referred to in the text as processing channel ‘1’) while majority (70%) cassava flour processors adopted the processing channel which comprised peeling-washing-soaking-sifting-dewatering-molding and drying (referred to in the text as processing channel ‘1’). For fufu processors, majority (88%) adopted the processing channel which comprised peeling-washing- soaking-fermentation- sifting-dewatering-boiling and molding (referred to in the text as processing channel ‘1’) . On marketing channels, majority (60%) and (53%) of garri and cassava flour marketers adopted marketing channels which comprised packaging-transportation-wholesaling-retailing and final consumers (referred to in the text as marketing channel ‘1 ’) while majority (57%) of the fufu marketers adopted marketing channel which comprised packaging-retailing and final consumers (referred to in the text as marketing channel ‘3’). The socio-economic factors that influenced output of cassava products were sex, level of education, amount of initial capital invested, family size, marital status and age of the respondents. The study also found out that 79.9% of total variability in the output of garri enterprise was explained by the stated socio- economic factors which influenced output of the garri product. Meanwhile, 62.7% and 81.1% of cassava flour and fufu enterprises profit were explained by the same factors respectively. Thus, the null hypothesis which stated that socio-economic factors of cassava processors/marketers do not have significant effect on the output of cassava products processed and marketed was rejected for the three enterprises at the 5% level of probability. In the garri enterprises, the combined effects of all the variables and fixed inputs in the profit function explained 78.9% of the variation in the maximum variable profit while the combined effect of the variable and fixed cost in the profit function in cassava flour and fufu processing/marketing enterprises, explained 80.1% and 84.4% respectively of the variation in the maximum variable profit. The null hypothesis which stated that output and input prices do not significantly affect profit of garri, cassava flour and fufu enterprises was rejected at 5% level of probability. Lack of capital for expansion, irregular power and water supply, fluctuation in prices of output and irregular shapes stood out as the most challenging constraints to the respondents in the cassava processing/marketing activities. The study among other things recommmended, provision of finance and infrastructural facilities such as road and supply of water and electricity to reduce cost of processing/marketing of the cassava products.

CHAPTER ONE

INTRODUCTION

1.1      Background of the Study

Cassava (Manihot spp) is believed to have originated from Brazil and was introduced into West Africa countries by the Portuguese (Antonio, 2002). Benue and Kogi States in the north central zone of Nigeria are the largest producers of cassava in the country (IITA, 2004). Cassava’s comparative advantage compared with other food crops lies in its efficient production of cheap food energy. In addition, cassava is available all year round as well as tolerant to extreme conditions. These qualities contribute in alleviating African food crises (Nweke, Dixon, Asiedu and Folayan, 1994). This accounts for why Philip (2005) referred to cassava as the “famine security crop”.

Studies have shown that cassava contains substances known as cyanogenic glucosides, which break down into hydrocyanic acid (HCN) after the crop must have been harvested. This acid makes raw cassava very poisonous for human consumption. Processing is therefore important as a means of removing this poison by reducing its toxicity and increasing its palatability (Adegeye, 1999). After harvest, cassava roots are processed to stop physiological and microbial spoilage, reduce the cyanogenic glucosides content and convert the roots to other products that are more acceptable (Asiedu, 1989). Major products derived from cassava are cassava flour (alibo), fufu, garri, starch, tapioca, sliced cassava chips (abacha) and other cassava-based products.

Rural based cassava processing activities offer opportunities in terms of employment. It is estimated that 60 percent of the labour force in Sub-Saharan Africa are gainfully employed in small-scale food processing enterprises and majority are women (ITDG, 2005). Cassava may in fact hold the key to fully land use intensification in Africa (Enete, 1995). This is because population increase is often accompanied by switch to crops previously thought to be inferior due to protein, essential minerals and vitamins content but with higher yield as is the case with Africa where cassava has ousted the traditional yam (Griggs, 1980). The market for cassava can be divided into two categories, the traditional food-oriented market and the new emerging market for industrially processed cassava. The vast majority of the cassava grown in Nigeria is processed and sold through the traditional market channels which are fairly well known. In 2002, cassava suddenly gained national prominence following the pronouncement of a Presidential Initiative. The intent of the Initiative was to use cassava as the engine of growth in Nigeria. To put Nigeria in the global context for competition, the country needs to upgrade the use of cassava in primary industrial manufacturing of starch, ethanol, chips and flour in order to provide an industrial base for further diversification of its national economy. Cassava can be used to improve rural and urban income and development in Nigeria if investments in the downstream sector or the industry are made more effective through value addition.

The value chain describes the full range of activities which are required to bring products from conception, through different phases of processing involving a combination of physical transformation and the input of various producers, before delivery to the final consumers and final disposal after use (Kaplinsky and Moris, 2000). Most of the processors prefer to offer the commodity to the market without bearing the cost involved in value adding because of the uncertainty in the market. The continuous fluctuation of prices of final goods in the market poses a serious problem to processors who are interested in adding value to their products. Figure 1.1 illustrates a simple value chain.....

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