INVOLVEMENT OF SMALL AND MEDIUM SCALE ENTERPRISES IN CULTURE FISH VALUE CHAIN IN NIGER STATE, NIGERIA

ABSTRACT

This study assessed involvement of small and medium scale enterprises (SMEs) in cultured fish value chain in Niger  State,  Nigeria.  Fish provides a rich source of protein for human consumption. The  specific  objectives  were  to:  describe  the  socio-economic   characteristics   of the  SMEs, examine the various SMEs in cultured fish value chain, determine the income disparities between the SMEs along the cultured fish value chain, evaluate the factors influencing the profit of SMEs in cultured  fish value  chain and finally examine  the constraints  of different  SMEs along the cultured fish value chain. A multi-stage  sampling technique  was employed in the selection of respondents to get a total number of two hundred and sixteen (216) respondents composed of 79 producers,  75 processors  and  62  marketers  on  which  questionnaire  were  administered  and complemented   with   face-face   interview.   Data   collected   were  analyzed   using   descriptive statistics,  flow  chart,  farm  budgeting  technique  and  inferential  statistics  such  as  multiple regression  analysis. The results  obtained  showed that mean age of producers, processors  and marketers  were  42 years,  40  years  and 42years,  respectively.  Majority  (93.8  %,  68.0%  and 71.2%) of the producers,  processors  and marketers  respectively,  were male implying that men were more involved in cultured fish farming than their female counterparts. The average mean of household  size was 7,  7  and 8  for producers,  processors  and marketers.  Also,  majority  of the cultured  fish actors  were  educated  having  a minimum  academic  qualification  of first school leaving certificate.  This implies that the cultured fish farmers could read and write, thus, able to adopt new innovations.  The results also showed that average farming experience  of producers, processors and marketers was 11.4 years,  10 years and 8 years, respectively.  The cost and return analysis of the culture fish producer for l000stock/production cycle gives a gross margin sum of N176,113.89  and a net profit of N123,096.91,  while processors  (100kg) had a gross margin of N51,239.00  with a net income of N32,260.09  and the marketers (100kg) had a gross margin of N26,564.80  with a corresponding  net income  of N25,351.40  this implies that the culture fish value chain business is profitable.  The pair-wise t-test showing differences  in the profit margin of the three value actors (producer, processors  and marketers) and how they significantly differ from one another revealed t – statistic value of 1.741  at 10% level of probability.  This implies that there was a significant difference in the mean profit of the producers and processors, while t – statistic value of 1.634 showed that there was no significant difference in the mean profit of the producers  and marketers.  Thus,  the null  hypothesis  was therefore  accepted  Furthermore,  t statistic value of -0.192 showed that there was no significant difference in the mean profit of the processors  and marketers.  Thus, null hypothesis was therefore accepted.  The major  constraints faced by cultured  fish value  chain  actors include:  Lack of ready market,  Shortage  of ponds’ water,  Poor extension services,  and high cost of fingerlings.  Processors  constraints  are majorly Poor  market  information,  Limited  access  to  credit  and  high  interest  rate,  Lack  of storage facilities. Marketing constraints are Challenges in prices of harvested fish, Lack of ready market, High cost of transportation,  Fish price are unstable,  Lack of transportation  facilities The study concluded   that   cultured   fish   farming   has   helped   increase   shelf-life,   open  new   market opportunities for producers by increasing job creation down the value chain this directly reduces rural poverty.  Based on the findings of this study,  it was recommended  that government  should improve on infrastructures in the rural areas and there should be active use of extension agents to transfer innovative ideas and technologies to the farmers.

CHAPTER ONE

1.0       INTRODUCTION

1.1       Background of the Study

Small and Medium Enterprises  (SMEs) has impacted greatly on the economic growth and development in Nigeria and across the world (Olowe et al., 2013).   Ofoegbu et al.  (2013) also agreed that SMEs are the bench mark of many developing countries such as Nigeria. They  believe  that       interest  in  SMEs  will  enhance  job  opportunity,  reduce  income disparities,  and  increase  production  of goods  and  service  in  the  economy  as  well  as providing a fruitful ground for talent progress. SMEs contribute to improving standards of living,   bring   about   substantial   local   capital   formation   and  achieve   high   level   of productivity.  SMEs  are  recognized  as the  principal  means  of achieving  equitable  and sustainable  industrial  diversification  and dispersal  (Adewuyi  et al.,  2010).   According  to Salami (2013),  SMEs account for well over half of the total share of employment  sales, and  constitute   the  most   viable   and  veritable   means   for  self  -sustaining   industrial development.  SMEs possess the capability to grow an indigenous enterprise culture more than any other strategy.

SMEs are divided into different industrial sectors such as agricultural sector, fishery sector and marketing sector which plays a vital role in the industrial development.  Schaper (2016) reported that, there have been several ideas to move from capital intensive to large scale industrial  project  which  is  based  on  improving  the  SMEs  that  have  better  views  for developing domestic economy, thereby producing the required goods and services that will boost  the economy  of Nigeria  towards  development.  Ojo (2009) posited  that the major 1 challenges  of development  in  developing  countries  particularly  in  Nigeria,  is encouragement of entrepreneurial  development  scheme. Despite the abundant natural resources, the country still finds it hard to discover her developmental bearing since independence. Quality and adequate infrastructural provision  has remained  difficult; other sectors have perceived downward performance while unemployment rate is on the increase (Oni and Daniya, 2012).

Fish is an important source of animal protein with good amino acids and essential minerals profiles.  According  to  Food  and Agriculture  Organization  of the  United  Nations  (FAO) (2018), there is great gap between the demand of fish and fisheries production  in Nigeria. According to the report, there is about 179 million tonnes of supply in 2018 globally; while in Nigeria  the current  fish production  stands at 0.8million  metric tonnes with a deficit of 1.9million  metrics  tonnes  of fish,  as  local  demand  for  the  protein  is  2. 7million  tonnes annually.  This makes Nigeria one of the largest importers of fish in the developing world, importing  600,000 metric tonnes annually (Adewuyi et al., 2010).  It is therefore important to  ensure  that  improved  fish  production  technologies  that  have  been  developed  and disseminated are adopted, in order to increase fish production. Fishery industry is essential to the World economy,  the livelihood of millions of people worldwide  are dependent on fish  farming  (Golden  et al.,  2016).  Fish provides  a rich  source  of protein  for human consumption.  The flesh of fish is readily digestible and immediately utilize by the human body,  making   it  suitable  and  complementary   for  regions   of  the  world  with  high carbohydrate  diet,  like Africa  (FAO, 2015). However,  global evidence  indicates  that in many  areas  of  the  world,  particularly   in  Africa,   fishery  management   has  decline (Beaumont, 2016).

Over the years, efforts have been made to develop new technologies, which have been introduced to the industry.  This has led to more fish being caught, but this has also resulted in the over-exploitation  of fisheries (Y~ez  et al., 2017). The consumption and demand for fish as a major source of protein is rapidly increasing in most African countries, because of the poverty level in Africa.  Fish is mainly supped from rivers in the continent, but capture fisheries  are based  on  species  presently  exploited  which  seems  to  have  reached  their natural limits (Ferrol-schulte et al., 2013).

The aquaculture  industry  has great potential  to meet the increasing  demand  for aquatic food in most regions of the world (Akegbejo-Sarnsons  and Adeoye,  2017).  The need for intensive and skilled management  sterns from the high  level of capital  invested  in the facilities,  and in the high levels of operating capital required to operate a competitive and profitable SMEs.  Commercial aquaculture (farming operations of aquatic organisms) seeks to maximize profits (business-oriented)  especially by the private sector. Majority of SMEs involved in cultured  fish require  substantial  amounts  of both  operating  and investment capital. One of the largest problems encountered in starting a cultured fish SMEs often is to acquire sufficient capital.

Aquaculture value chains include a sequence of value adding activities, from production to consumption, through processing and marketing (Gereffi and Femandez-Stark,2011). Each segment of a chain has one or more backward  and forward linkages. A value chain in agriculture identifies the set of actors and activities that bring a basic agricultural product from production in the field to final consumption, where at each stage value is added to the product (De Silva,2011 ).

According to Ifejika  et al.  (2007a), fish farming is one of the new initiatives that have been implemented in various areas in Niger  State. Fish farming is carried out by fish farmers through fish ponds and is mainly practiced by farmers in the rural communities as a source of food and income.  The response has been positive and extremely high as evidenced by a large number of individual farmers and famers’ groups specialized in fish farming.

As reported by Ali et al.  (2008),  culture fish value chain in Niger State was fairly simple and  short,  with  wholesalers  and  traders  buying  at the  farm-gate  and  re-selling  either directly  to  restaurants  or  market  women  who  retail  fresh  or  smoked  fish  directly  to consumers in Niger State’s various markets. The consumer preference is for large fish at bars/joints  and restaurants, the  small and odd-sized  fish also find a ready market  with wholesaling market women who specialize in smoking fish. Domestic smoked fish demand in Nigeria is estimated to be as large as the fresh fish market, and increasing in markets far away  from  the  coast.  Smoked  fish  markets  were  generally  controlled  by  fish  market women who by tradition,  smoke fish and sell at a margin to mostly traders and retailers, and sometimes to consumers as well.

1.2       Statement of the Research Problem

The  global  production  of fish  has  decline  over  the  years,  and  has  highlighted  many challenges to development. Culture fish enterprises, particularly in Niger State, often have low production  efficiency, experience  occasional production  crashes due to fish diseases Ifejika et al.  (2007b) contribute to pollution and the loss of mangroves. Efforts to sustain or accelerate culture fish growth in Niger State must address breed improvements, fish health, sustainable feeds and environmental management, together with the need for socially equitable distribution of economic and nutritional benefits.

In Niger  State, majority  of poor and unemployment  youth have engaged  in establishment of personal  SMEs  in  other to  improve  their  standard  of living  (Sharu  and  Guyo,  2013). Consequently,  entrepreneurship  is growing to a fast level and becoming  a household name in Niger State.  Reasons being that the white collar jobs that people admire and boast of are no longer there. Even, the touted  sectors (Banks and companies)  known  to be the largest employer of labour are on the down-tum  following the consolidation  crisis and fraudulent practices  of  high and mighty in the banking  sector. The companies  of course are folding up  as a result  of erratic power  supply,  insecurity  and persistent  increase  in  interest rate which  has  led  to  high  cost  of production  that  undermines  profit  making  potentials  of companies operating in Niger State.  As a result of banking sector practices and continuous folding up of companies,  a lot of people are thrown into unemployment  which inevitably is detrimental to the economic situation of the country (Salami, 2013).

Culture  fish are projected to be the dominant  supply of fish for many  in Niger  State for decades (World Bank, 2014).  However, most people face severe pressure from overfishing, particularly  in resource-poor  regions where fish is an important source of food and income (FAO,  2014).  The most  recent  analysis  of culture  fisheries  clearly  demonstrates  that the importance   of  small-scale   fish  farming   for  food  security   of  Niger   State  cannot  be overemphasized  (Pauly,  2008).  The performance  of the  fisheries  sector  in Niger  State  is below expectation with low supply as a result of low production.  This is evident in the fact that Niger State still imports fish into the State to supplement fish production.  Fish farming in Niger State is the least exploited fishery sub-sector with the vast brackish water fishing grounds almost unexploited  (Ejiola  and Yinka,  2012).  Less than  1.0%  of the  fresh water grounds and about 0.05% of the brackish water grounds are under aquaculture to produce a current average yield of 20,500 tonens  of fish per annum.  This represents  only 3.12% of the  estimated  culture  fish potentials  of 656,815  tonens per  annum  (Oyinbo  and Rekwot, 2013).

In  spite  of these  great potential  of natural  resources  and man-power  availability  to  fish farming in Niger  State, the State is still currently unable to bridge the gap in the short fall between  total domestic  fish production  and total domestic  demand. Niger  State has been unable to produce  enough fish for consumption because improved high-breeds  of fish that depend  on  phytoplankton  have  not  been  adequately  adopted;  but  still  depend  on  local varieties that are of low productivity.  Salami (2013).  Besides,  most rural farmers who are the major producers  of fish,  do not have  adequate  access to purchase  fish  equipment  or facilities  which have tendencies  for enhancing productivity,  income and alleviating  rural poverty.  Fish  farmers  as  other  farming  producers  are not  enjoying  the  benefits  of their products   due  to  inadequacy  of  inputs  and  markets.  Value   chain  is  essential  to  the understanding  of markets, their relationships, the participation  of different  actors, and the critical constraints that limit the growth of fish production  and consequently the competitiveness   of smallholder  farmers.  These  farmers  currently  receive  only  a  small fraction of the ultimate  value of their output, even though in value chain theory, risk and rewards  should  be  shared  down  the  chain.  The  potential   for  an  improved  and  well• functioning market which will enable smallholder producers to derive greater benefits from their production activities has not been fully tapped.

Despite the great opportunities  which the fishery  sub-sector holds in Niger  State,  a lot of the  fish  resources   are  being   wasted   and  underutilized   on  a  daily  basis   due  to  an unorganized  or uncoordinated  distribution  channel  (Aihonsu  and  Shittu,  2008).  The  fish value chain in Niger State are not yet developed to meet international market requirements as limited value addition is done in the industry and this has limited fish and fish products to only domestic  markets.  Value  addition  to fish in Niger  State  is mostly  simplistic  and traditional.  The reasons include fisher folk eagerness to raise immediate  income from fish harvest   and  the  high  level  of  fish  spoilage   once  harvested.   It  is  thus  against  these backdrops  that this  study intends to examine  the  SMEs value  chain of culture  fish in the study area by providing answers to the following research questions:

i.        What are the socio-economic  characteristics  of the SMEs?

ii.      What are various SMEs in culture fish value chain?

iii.  What  are the  income  disparities  between  the  SMEs  along  the  culture  fish value chain?

iv.  What are factors influencing the profit margin of SMEs in culture fish value chain actors?

v.    What are the constraints of different  SMEs along the value chain?

1.4      Aim and Objectives of the Study

The main aim of the study is to determine  the involvement  of small and medium  scale enterprises in culture fish value chain in Niger state, Nigeria. The specific objectives of the study are to:

i.                 describe the socio-economic characteristics of the SMEs;

ii.                examine the various SMEs in culture fish value chain;

iii.              determine the income  disparities between the SMEs along the culture fish value chain;

iv.         evaluate  the  factors  influencing  the  profit  of SMEs  in  culture  fish  value chain, and

v.          examme  the  constraints  of different  SMEs  along  the  culture  fish  value chain.

1.4      Hypotheses of the study

The following null hypotheses  were formulated subject to further empirical validation in this study:

HO. There is no significant relationship between some socio-economic  characteristics  of (age,  gender,  household,  education  and  experience)  of SMEs  value  chain  and  profit realized.

HO: There is no significant difference in the profit realized among the various SMEs in culture fish value chain.

1.5      Justification of the Study

In Nigeria, the role of fish is recognized in the National Development Plan (2013 – 2016). Improvements  in governance  and management  of resources  along  the  value  chain  are identified as key to sector development (Sharu and Guyo 2013).Fish as a source of animal protein has played a vital role in the nutritional budgets of many nations as fish production is becoming more valuable and important source of food protein. The world food crisis and present demand for food are increasing the demand for fish and aquatic organisms which can directly be consumed or converted to food for human consumption.

Fish requires high quality nutritionally balanced diet for growth and attainment of market size within the shortest period  of time. Therefore, local production  of fish feed is very important to the development and sustainability of culture fish in Nigeria, particularly the rural areas. For aquaculture  to reach and bridge the already existing wide gap between fish demand and supply especially in the Sub-Saharan Africa,  the vital role of locally produced fish  feed  in  reducing  production   cost,  thereby  making  fish  farming  attractive  to  both private  and commercial  investors and ultimately  to boost  fish production  cannot be over• emphasized  (Gabriel  et al.,  2007).   Fish and fisheries are included  in the SMEs and are expected to maximize  their contribution  to the target 6% annual agriculture productivity growth rate. The value chain approach has been seen by notable organizations, government and  other  agencies  as  a very  reasonable  and  concrete  way  of poverty  alleviation  by focusing  on weak links and constraints  faced by various actors in the value chain.  The process not only include more actors but it also covers wider range of activities  such as facilitating  access to inputs,  strengthening  the delivery  of SMEs and financial  services, enabling the flow of information and facilitating  leveraging to higher-value  markets.  The cumulative effect of the activities collectively leads to the creation of more jobs and more mcome.

Therefore, the outcome of this study is expected to expand the frontier of knowledge.  The exploration  of facts  findings  is  expected  to  raise  some  policy  issues  and  give  policy direction to policy makers. It will give new knowledge  for prospective  entrants into the SMEs, stakeholders  and researchers. This will not only reduce poverty, but also help the poorest  of the poor to contribute  and benefit  from the value chain. This study will also provide  basis  for  the  review,  design  and  implementation   of new  poverty  reduction strategies and could serve as a baseline  for the assessment  and monitoring  of fish value chain under  SMEs in Niger  State.  Thus,  the study aimed at contributing  to bridging the knowledge  gap,  promoting  co-operation,  co-ordination  and communication  among the fish value chain stakeholders.

₦8,000.00 – DOWNLOAD FULL PROJECT DOWNLOAD FULL PROJECT Added to cart

---

---

---

---

Related Project Topics :