Profitability Analysis of Greenhouse Tomato Production in Oyo State, Nigeria

Qudus Gbolahan  Nafiu; Olaniran Anthony Thompson

doi:10.35516/JJAS.3989

Authors

Qudus Gbolahan Nafiu Federal University of Technology, Akure, Ondo State, Nigeria https://orcid.org/0009-0005-1121-616X
Olaniran Anthony Thompson Federal University of Technology, Akure, Ondo State, Nigeria https://orcid.org/0000-0002-7361-3364

DOI:

https://doi.org/10.35516/JJAS.3989

Keywords:

Greenhouse technology, Tomato production, Profitability Analysis, Cobb-Douglass production function, Food security

Abstract

Greenhouse technology has been recognized as the best innovation in addressing issues of food insecurity, improved agricultural production, and climate change issues. Therefore, this study investigates the profitability of greenhouse tomato production in Oyo State, Nigeria. Data were collected from 60 respondents across six local government areas using a multistage sampling technique. Descriptive statistics analysis, gross margin analysis, and the Cobb-Douglas production function analysis were only used to assess the profitability as well as establish the factors affecting it. This finding shows that greenhouse tomato production is very lucrative with a gross margin of ₦10,678,978.65, and the benefit-cost ratio of 3.99 means every ₦1.00 invested yields ₦3.99. The computed annual net farm income of ₦9,331,986.65 reasserts this farming system as economically feasible irrespective of the high initial investments. Significant determinants of profitability include farm size, farming experience, and labor costs, all statistically significant at the 5% level. However, the high cost of seeds negatively affects its profitability, which stands out as an essential constraint. Some critical issues facing greenhouse tomato producers include water scarcity, high costs of production input and competition in the market. Such challenges require policy interventions, such as subsidies on agricultural inputs, support for sustainable means of irrigation and strengthening of farmers’ technical knowledge. This study calls for collective action between the government, private stakeholders and researchers to scale up adoption and overcome existing barriers, all of which can help enhance rural development and national food security.

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Author Biographies

Qudus Gbolahan Nafiu , Federal University of Technology, Akure, Ondo State, Nigeria

Department of Agricultural and Resource Economics, Federal University of Technology, Akure, Ondo State, Nigeria

Olaniran Anthony Thompson , Federal University of Technology, Akure, Ondo State, Nigeria

Department of Agricultural and Resource Economics, Federal University of Technology, Akure, Ondo State, Nigeria

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