Farm level efficiency and profitability of Soybean farmers in Otukpo Local Government Area of Benue State, Nigeria

Abstract

This study analysed the farm level efficiency and profitability of soybean production in Otukpo local government area of Benue State, Nigeria. The objectives of the study were to examine the profitability, technical and cost efficiencies, and constraints faced in soybean production. A multi stage sampling technique was used to select 215 respondents and data obtained were analysed using descriptive statistics, gross margin and stochastic frontier functions. The study revealed that majority (60.0%) of the respondents were male, 60.9% were within the age group of 18-40 years, 78.1% of the respondents spent at least 6 years in school. The profitability analysis from the study showed an estimated gross margin was ₦70246 per hectare. The respondents had a mean cost efficiency of 0.93 and mean technical efficiency of 0.78. The major challenges faced by soybean farmers were buyer unwillingness to pay higher price for improved output, poor storage facilities, scarcity of labour during cultivation and harvest seasons, and high cost of inputs. Farmers should group themselves to engage in contract farming agreements with buyers. These contracts can specify prices, quantities, and quality standards, providing a degree of price certainty and bargaining power. Farmers should join or form input cooperatives with fellow farmers to bulk purchase inputs at discounted rates. Collective purchasing can lead to cost savings.