Economics of value addition in tomato

Abstract

Post-harvest losses during the peak season of tomato production reduce its profitability and availability. Processing tomato into value added products could minimize loss experienced. The study evaluated costs and returns in small scale processing of tomato into tomato dry slices, powder, whole peel and puree. Data was compiled during the training of 200 youth and women on tomato value added products and analyzed using the profitability indicators such as Benefit to Cost Ratio (BCR) and Rate of Return on Investment (ROI). The Highest cost of N250, 180 was incurred when 1 tonne of fresh tomato was processed into whole peel tomato; the least production cost per tonne of processed tomato was incurred with tomato puree (N138,780). The most profit, N549,820/tonne of fresh tomato processed, was for whole peel tomato, followed by tomato puree (N161,220) and the least profit of N64,310/tonne from dry tomato slices. Processing tomato into dry slices, powder, whole peel and puree had BCRs of 1.38, 1.08, 3.19 and 2.16. The rate of return on investment of 0.38, 0.8, 2.19 and 1.16 was obtained for tomato dry slices, powder, whole peel and puree indicating profitability of the enterprises. Processing tomato into value added products is profitable, reduces post-harvest losses and may improve stakeholders’ income and livelihood.