Profitability of shea butter processing business for rural women in Borgu LGA, Niger State, Nigeria

Abstract

This study investigated the profitability of small-scale shea butter processing enterprises in Borgu Local Government Area, Nigeria. It examined the socio-economic characteristics of processors (n=120), their processing methods, as well as the factors influencing profitability. A multi-stage sampling procedure was employed. Three wards and two villages were selected in each Local Government Area, followed by a random selection of 50% of identified shea nut processors. The findings revealed that the majority of processors were women (93%) with an average age of 39 years. Most had basic education or Qur'anic education only and relied on traditional processing methods. The results showed an average weekly gross margin of ₦2,237.78. However, considering the imputed cost of Shea nuts (gathered wild), the actual gross margin could be much higher at ₦6,665, resulting in a return on investment exceeding 58%. Years of experience and age were positively associated with profit margin, indicating that more experienced and older processors earned more. Conversely, educational level and household size had a negative association with profit margin although at the 10 level of significance.  It can be concluded that Shea butter processing offers a significant income-generating opportunity for rural women in Nigeria. However, traditional methods and limited knowledge restrict profitability. It is hereby recommended that interventions are needed to improve processing techniques, empower processors through education and training, and address constraints like unstable prices and inadequate storage facilities. This could significantly enhance the sector's contribution to rural livelihoods and women's economic empowerment.