Determinants of Rice Farmers’ Investment in Value Addition and Its Effect on Poverty Status in Kebbi State, Nigeria

Abstract

The study examined investment of rice value addition activities among farmers in Kebbi State, Nigeria. Data used for the study were collected with the aid of structured questionnaire administered to 123 randomly selected farmers in three local government areas of the state. Data was analyzed using Foster Greek Thoerboeck (FGT) poverty index and logit regression technique. The results showed that poverty status among the rice farmers was high, as 58.3% were poor and 42.7% were non poor. The result of the analysis showed that the marginal effects of income from parboiling, winnowing, drying, destoning, and bagging value addition were negative and statistically significant related to farmer’s poverty status at 1% level. It was concluded that rice farmers’ investment in value addition should be promoted among the farmers in Kebbi State. High cost of labour (81.0%), poor marketing information (75.6%) and inadequate credit (73.1%) were the three most critical constraints limiting the farmers in engaging in value addition activities. It was
recommended that farmers cooperatives should form collaboration with extension agent to make farmers aware of the benefits of investment in value addition activities and those farmers already investing in value addition should make use of the modern method of processing instead of the traditional practices which help to increase their income.

Keywords: Investment, Value addition, Processing, Poverty status and Rice farmers