Economics of upland rice (Oriza sativa) production in Ivo local government area of Ebonyi state, Nigeria

Abstract

Economic analysis of upland rice production in Ivo Local Government Area of Ebonyi State was done. Data were generated through structured questionnaire and oral interview schedules administered on one hundred and twenty rice farmers, which were selected randomly from the local government area. The data were analysed using Cobb Douglas production function, budgetary system and descriptive statistics. The results showed that Cobb Douglas production function was the lead equation because of highest R² = (0.7725) and highest number of significant variables. Thus 77.3% of the variation in rice output is explained by the variables included in the model. The elasticity of rice production showed that all inputs were inelastic since they all have marginal value products less than 1. The return to scale was greater than 1indicating an increasing return to scale. Resource use efficiency showed that the farmers did not achieve optimum allocative efficiency in the use of any of the farm resources. Net farm analysis showed that the total cost of production of rice was N69,280 per hectare with total revenue of N140,460. The net farm income was N71,180, which implies that rice production is profitable in the study area. Most farmers complained of poor access to credit and high cost of labour as major obstacles to rice production. Policies that will enable farmers to employ more of their production resources such as encouraging the retribution and reallocation of resources should be made possible in order to improve farmers, performances. Also, increasing farmers’ access to production inpus; (fertilizer, improved varieties and land) were advocated.

Keyword: Economics, Allocative, efficiency, rice, production