ANALYSIS OF PROFITABILITY AND VALUE ADDITION ALONG GINGER VALUE CHAIN IN KADUNA STATE, NIGERIA

Abstract

This study analyzed the profitability of ginger value chain in Kaduna State, Nigeria. Multi-stage sampling technique was used to select 160 producers, 55 wholesalers, 109 retailers, and 53 processors for the study. Seven exporters operating in Dawanau Market were sourced through key informants and all of them were selected. Primary data were collected using structured questionnaire, interview and analyzed using descriptive statistics and farm budgetary techniques. The results showed that ginger production in Kaduna State was profitable with gross margin of ₦273,107.29/ha. Similarly, among the marketers, results of marketing margin analysis showed that ginger marketing was also profitable, with marketing margins of ₦81.27/kg and ₦120.76/kg for wholesalers and retailers respectively. Our findings further showed that ginger processing was the most profitable segment along the value chain, with the processors recording processing margins as high as ₦397.44/Kg and ₦256.65/Kg for processed ginger with and without others spices respectively. Further, export margin of ₦333,032.82/ton recorded by ginger exporters showed that the ginger exporting enterprise was profitable. Our findings further revealed that the highest value addition along the value chain was in the processing segment of the chain, which amounted to ₦2,567.37 per kg. The study concludes that ginger enterprises along the value chain were profitable and worthwhile. It recommends that the government, through collaboration with development partners and/or value chain development projects should make adequate supply of high quality and affordable fertilizer, which constitute a major cost component in the production segment, in order to improve profitability along the entire chain.