INTRODUCTION

 

1.1  Background to the Study

Processing  of  agricultural  products  is  generally  accepted  as  the  efficient  method  of maintaining the  shelf-life  of produce.  Such processed  products provide  local  foods  for consumption among the rural population (Zuberu et al., 2013). Hence, the importance of crop  processing  industries  especially  in  Nigeria  cannot  be  over  emphasized.  The  crop processing industry of Nigeria like other African countries is dominated by the informal sector comprising mainly of small and medium scale rural enterprises owned and operated by  men  and  women  who  depend  solely  on  indigenous  technology  (Aseidu,  2009). Groundnut, soya beans, banana, palm kernel, potatoes, cassava, et cetra were some of the dominant agricultural produce that are processed into local foods consumed by the rural communities in Nigeria (Napodo and Ditto, 2013).

Groundnut is one of the most valuable legume crops of Nigeria and other tropical countries with 25 percent protein and more than 40% oil. Nigeria is a major producer of groundnuts accounting for 25 percent of world exports (IFPRI, 2012). In 2004 the country had 3500 hectares cultivated and production of 2750 tonnes (NBS, 2013). Groundnut accounted for 70% of total Nigeria export prior to petroleum oil boom (World Geography of Peanut, 2013). Groundnut is widely consumed in Nigeria as roasted or boiled nuts in the Western and Southern parts of the country (Adebesin et al., 2011).

Groundnut  has contributed  immensely to the development  of the Nigerian economy  in general and employment generation among the rural groundnut farmers and processors in particular. Also, they are important in the confectionary trade among the rural traders and the stable oil from groundnut is preferred by the deep-frying industries since it has a smoke point  of  229.4oC  compared  to  193.5oC  of  soybean  oil.  The  oil  is  also  used  to  make margarine and  mayonnaise (Hulme and Mosley,  1996). Confectionary products such as snack nuts, sauce, flour, peanut butter and cookies are made from high quality nuts of the crop.

Groundnut plays an important role in the diets of rural populations, particularly children, because  of  its  high  contents  of  protein  and  carbohydrate.  It  is  also  rich  in  calcium, potassium, phosphorus, magnesium and vitamin E. Groundnut meal, a by-product of oil extraction, is an important ingredient in livestock feed. Groundnut haulms are nutritious and widely used for feeding livestock. The groundnut oil is composed of mixed glycerides, and contain a  high proportion of unsaturated  fatty acids,  in particular  Oleic  (50-56%)  and Linoleic (18-30%) (Young, 1996).

Nigeria was the third highest producer of groundnut in the world after China and India with a production of 16,114,231, 6,933,000 and 2,962,760 tons respectively in 2011. In Nigeria, the crop is presently grown throughout the country with the exception of the riverine and swampy  areas.  The  leading  producing  states  in  Nigeria  include  Niger,  Kano,  Jigawa, Zamfara,  Kebbi,  Sokoto,  Katsina,  Kaduna,  Adamawa,  Yobe,  Borno,  Taraba,  Plateau, Nasarawa, Bauchi, and Gombe States (Yusuf, 2008).

In the Northern part of Nigeria, apart from being consumed raw, edible groundnuts are processed into many local foods or included as an ingredient  in a wide range of other products which includes groundnut paste which is fried to obtain groundnut cake (kuli kuli), salted groundnut (gyada mai gishiri), a gruel or porridge made with millet and groundnut (kunun gyada), groundnut candy (kantun gyada) and groundnut soup ( miyar gyada). The shells are used for fuel by some local oil factories or they are sometimes spread on the field as a soil amendment. They could also be used as bulk in livestock rations or in making chipboard for use in joinery (Mukhtar, 2009).

In Zamfara State, in particular, some of the processed local foods from groundnut include Nigeria groundnut cake called „kulikuli’, groundnut oil (mangyada), groundnut pap (kunun- gyada), salted groundnut (gyada mai gishiri), et cetra. The root could also be processed in a variety of ways, like roasting, baking, boiling, frying or drying for flour while the seeds can be substituted for beans or lentile in soups and stews (Brian, 2009).

Groundnut cake is a popular local food consumed even by both the urban and the rural population in Zamfara State. However, despite the importance of groundnut oil and cake processing  ventures  in  employment  generation  and  poverty reduction  among  the  rural population in Zamfara State, there was paucity of information about their impacts on the poverty level of the processors in the State.  In order to close this gap, this research focused on  the  processing  of  groundnut  into  groundnut  cake  (Kulikuli)  and  groundnut  oil (mangyada) in Zamfara State. The impact on the poverty level of the processors as well as the   defects associated with the processing methods were investigated and analyzed.

1.2 Problem Statement

The  groundnut  cake  and  oil  known  as  „Kulikuli‟and  mangyda  respectively  in  Hausa language contained about 40-50% protein and is a valuable feed mainly for poultry. It is also used in preparing groundnut soup. Groundnut flour produced from the cake can also be used for enriching tuber flours such as cassava flour which is low in protein (Aseidu, 2009). Groundnut cake is a popular local food consumed by the rural population in Zamfara State in  addition  to  groundnut  oil.  However,  despite  the  importance  of  groundnut  oil  and groundnut cake processing ventures in employment generation and poverty reduction among the rural population in Zamfara State, previous studies have not focused on the economic analysis of the impact of groundnut processing on poverty alleviation among the processors, whereas, economic returns of groundnut processing depends on wealth the of processors, costs and the price of groundnuts. Previous researches on groundnut processing in Zamfara State  have  focused  on the  marketing  system,  financing  and  roles  in rural development (Ugwu, 2009).

This  information  gap  in  the  previous  studies  necessitates  this  research  to  assess  the economic impact of groundnut processing on the poverty level of the processors with special focus on the processing of groundnut into groundnut cake (kuli kuli) and groundnut oil (mangyada) in Zamfara State, Nigeria. In a quest to ascertain the economic impact of the groundnut processing on the poverty level of the processors in the study area, the following research questions were raised:

 

(i)What  are  the  socio-economic  characteristics  of  the  groundnut  processing entrepreneurs?

 

(ii)What are the profitability levels of groundnut cake and groundnut oil processing

firms?

 

(iii) What  are  the  economic  and  allocative  efficiencies  of  groundnut  processing

firms?

(iv)What are the determinants of allocative and economic efficiencies of groundnut

processing firms?

 

(v)What are the impacts of groundnut cake (kuli kuli) and groundnut oil (mangyada) processing firms on poverty alleviation among the processors?

 

(vi) What are the constraints militating against the groundnut cake (kuli kuli) and

groundnut oil (mangyada) processing ventures in the attainment of their goals?