Profitability and viability analyses of small-holder cocoa production three management systems in Abia State Nigeria: A study for commercialization implications

Abstract

The study examined the viability of small-holder cocoa production under three management systems in Abia State. The systems studied were owner-, lease and sharecrop management systems. The instrument of data collection was questionnaire. Using a random selection method 150 cocoa farmers were selected for the study. The data collected were analyzed using descriptive statistics, Benefit Cost Ratio and Net Present Value at 10% discount rate. Results show that cocoa production is profitable and viable in the study area. Also, the three management systems are efficient and practicable. The NPV for owner managed was highest showing that it is the most economically viable management system. It is recommended that ample amount of capital therefore should be invested into cocoa production to reinvigorate life in this dying and critically dwindling commercialized sector. Thus government and multinationals should assist the cocoa farmers with soft loans to encourage them help enhance production and break even. Moreso, group production should be encouraged in the study area for commercialization purposes considering the fact that cocoa production option is viable and profitable.