Institut für Ernährungswirtschaft und Verbrauchslehre

Impact of agricultural technology and market access on the welfare of rice producing households in Nigeria

The roles of Green Revolution in increasing food production, poverty reduction and fostering overall economic development in Asian and Latin America and countries are well documented in literature. Green Revolution which started in Mexico in the 1940s had its roots in the adoption of agricultural technologies specifically; high yielding varieties (HYV), irrigation and chemical inputs Agricultural technologies can have both direct and indirect effects. The direct effects of adoption of improved technology include productivity gains and lower per unit costs of production, which can raise incomes of producers. Indirect effects include lower food prices, increased employment and wages for farm labour and production of cheap raw materials required for rapid industrialization However, quantitative evidence of the impact of agricultural technology on rural households’ welfare in Sub-Saharan Africa is thin because only few empirical studies have been done hitherto.

Rice is an important food crop whose popularity and consumption have been on a steady increase in Nigeria in the last four decades. Its consumption has risen tremendously as a result of the accelerating population growth, rapid urbanisation and changing family occupational structure. Available data show that, out of about 5 million tons of rice consumed annually, only 3 million tons are produced locally. The balance of 2 million tons is imported into the country . In a bid to close the gap between rice demand and supply, Nigerian government has implemented different policies, in order to encourage local production. Rice cultivation therefore offers a means of employment to many Nigerian smallholder farmers. Nevertheless, low productivity and low returns on farming are disincentive to rice production in the country. The growth being recorded in domestic production is largely due to area expansion. The average yield of rice in Nigeria is very low (currently 1.8 tons/ha), compared to 9.42 tons/ha in Egypt, 7.54 tons/ha in the USA and 6.55 tons/ha in Japan (FAOSTAT). In the 1990s, the African Rice Center (formerly WARDA) developed the New Rice for Africa (NERICA) varieties, which are inter-specific crosses between the Oryza sativa high yielding varieties from Asia and the locally adapted multi-stress resistant Oryza glaberrina African rice species. NERICA varieties have higher yield potentials, are highly responsive in low input and rain-fed agricultural systems and have short growth cycle. These improved rice varieties are also resistant to African pests and diseases, have higher protein, better taste, and better quality.

Although the NERICA varieties have been widely promoted in Nigeria, its dissemination is limited, necessitating a need for studies to understand the adoption behavior and the contribution of NERICA technology to productivity, income and poverty reduction amongst the rice producing households. Increased agricultural productivity is expected to lower per unit cost of production and thus increases the income of the producers. Since increased income generation is essential in poverty reduction, an understanding of the contribution of high yielding varieties to profitability of rice farming enterprise is highly relevant in this study. Furthermore, assessing the economic benefits of adoption the new technology by comparing profit efficiencies of adopters and non-adopters is important, since the rice producers are market-oriented than subsistence Rice postharvest processing in Nigeria is dominated by cottage and small scale processors, whose activities are grossly undermined by low technology, infrastructural and institutional factors. Consequently locally produced rice is less preferred to imported rice because of poor grain quality. 

To address issues associated with grain quality, the private sector was encouraged to establish high technology rice mills to buy and process rice into better quality. This provides farmers with good opportunities in industrial market participation in contrast to the traditional practice of selling to the middle men at the farm gate. There is vast empirical evidence that show that smallholder farmers involved in industrial market participation and contract farming realize greater net earnings per ha or per kg of the produce marketed compared to the non participants. Participants also have better opportunities such as access to credit from the buyers and the assurance of market to sell their crops after production when compared to farmers selling their products in traditional channels. However, the welfare effects of industrial marketing participation in Nigeria has received less attention. This study therefore also examines the impact of industrial market participation on the welfare of the rice producing households in Nigeria.

 

Laufzeit: 01.04.2011
Projektleitung: Prof. Dr. Awudu Abdulai
Bearbeitung: Taiwo Osun, MSc.