Drivers of Technical Efficiency in Cassava Processing in Nigeria: Implications for a Commercializing Food Sector

Abstract

Most agriculture policies in Nigeria are aimed at integrating the rural poor into market economy. In the last decade, Nigeria witnessed significant private and public injection of capital into the promotion of small-medium scale cassava processing. This study uses a stochastic frontier function and inputs/outputs data to measure technical efficiencies (TE) of 274 small-medium cassava processing firms in Nigeria. Results showed that the cassava processing enterprises had a mean TE of 43 percent, indicating that, a large proportion of output value (57%) is lost due to firm-specific inefficiencies. Cassava processing enterprises in the north-central area of Nigeria recorded a mean TE of 61% (highest), followed by South-east/South-west (42%) and South-south (26%). TE values were below 80% for about 85% percent of the sampled enterprises. Technical efficiencies were influenced by enterprise classification (small-medium, sole proprietorship or family ownership), social factors (interaction with other actors), economic (number of products, clients or orders received) and attendance of training workshop. It is recommended that government and institutions with statutory role to promote agricultural value chains should consider encouraging and promoting small-medium scale cassava processing the more with adequate impetus. Constant training workshops to improve the skills and efficiency of the cassava processors are also recommended.

Keywords

• cassava processing
• efficiency
• normal/half
• normal distribution
• products value chain
• Nigeria