PERFORMANCE ANALYSIS OF COCOA MARKETERS IN ONDO STATE, NIGERIA

Abstract

Cocoa is a means of foreign exchange earnings for some of the West African countries. Hence, it becomes necessary to apply a functional market analysis to cocoa markets at the primary production level. This paper determined profitability and its correlates among cocoa marketers in Ondo State, Nigeria. Using multi stage sampling technique, fifty merchants were selected. Socio-economic characteristics of respondents collected were analyzed using descriptive statistics such as frequency and percentages while Gross margin analysis was employed to determine the profitability of the enterprise in the study area. Gini coefficient was used to examine the market structure while Ordinary Least Square regression model was used to ascertain the influence of some factors on the profitability of respondents. The result showed that 92% of respondents were married, with high (80%) literacy level. Most of the marketers have been on the job for long with the mean being about 18 years. The analysis also revealed that 66% of these marketers were primary assemblers while only 34% were bulk merchants. The profitability and efficiency ratio for the enterprise were 0.032 and 1.032, respectively. Gini coefficient value of 0.680175 obtained in this study indicates a high level of inequality in income among the respondents. The result also revealed that determinants of profitability in the enterprise were volume of goods handled by a marketer as well as its involvement in exportation. Ownership of a truck and the cost of warehousing were inversely proportional to profitability. The study concludes that the participation of a marketer in exportation of cocoa influences the volume handled and the profitability.