COMPARATIVE ANALYSIS OF TOMATO PRODUCTION AMONG FARMERS USING INFORMAL AND FORMAL CREDIT SOURCES IN KANO STATE, NIGERIA
COMPARATIVE ANALYSIS OF TOMATO PRODUCTION AMONG FARMERS USING INFORMAL AND FORMAL CREDIT SOURCES IN KANO STATE, NIGERIA
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Date
2011-08
Authors
AHMED, SABO SA’ID
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Abstract
This study analysed and compared tomato production among farmers using
informal and formal credit sources in three Local Government Areas of Kano
State, Nigeria. Three-stage sampling procedure and random samples were used to
select 120 informal (66) and formal (54) credit beneficiaries out of 600 tomato
farmers in twelve villages (i.e. four villages from each local government).
Interview method of data collection was used to collect the data. The analytical
tools used were descriptive statistics, farm budgeting and production function
analysis.
The results showed that while the average age of farmers who got credit from the
informal sources was 33 years, the average age of farmers who got credit from
formal sources was 34 years. The result further revealed that, the farmers that got
credit from informal sources applied for an average of N47,000.00 but they got an
average N43,000.00 while those who got credit from the formal sources applied
for an average of N99,000.00 but they got an average of N66,000.00. The resource
use efficiency showed that the two groups of farmers did not use their input
resources efficiently. The net farm income of farmers who used informal sources
was N46, 000.00 while farmers who used formal sources had a net farm income of
N114, 942.00. Thus, while the average rates of return of those who got loan from
informal sector was 33kobo per every naira invested, that of those who got loan
from formal sector was N1.00 per every naira invested.
In terms of constraints; for farmers who got credit from informal sources, high
interest rate was ranked first; insufficient amount of credit was ranked second
while lack of extension services in the areas was ranked third. For farmers who got
credit from formal sources, late disbursement of credit was ranked first,
insufficient amount of credit was ranked second and high interest rate was ranked
third.
It can then be concluded that production of tomato among small scale farmers in
the study areas is relatively profitable but the optimum profit has not yet been
reached due to the high interest rate on credit, late disbursement and insufficient
amount of credit received by tomato farmers among others which leads to
underutilisation of resources and ultimately result to relatively low output.
Description
A THESIS SUBMITTED TO THE SCHOOL OF POSTGRADUATE
STUDIES, AHMADU BELLO UNIVERSITY
IN PARTIAL FULFILLMENT FOR THE AWARD OF MASTER OF
SCIENCE DEGREE IN AGRICULTURAL ECONOMICS
DEPARTMENT OF AGRICULTURAL ECONOMICS AND RURAL
SOCIOLOGY, FACULTY OF AGRICULTURE, AHMADU BELLO
UNIVERSITY, ZARIA NIGERIA.
Keywords
COMPARATIVE,, ANALYSIS,, TOMATO,, PRODUCTION,, FARMERS,, USING,, INFORMAL,, FORMAL,, CREDIT,, SOURCES,, KANO STATE,, NIGERIA