Abstract

Odimegwe F. E1 *, O. W. Babatunde2 , Ogbonso Festus1 and Ambode Sunday

Profit maximization which is one of the common objectives of business enterprises is grossly dependent on how best productive resources are harnessed. In the light of this, this study was carried out to determine the profitability and resource use efficiency of poultry egg farmers in Ogun State, Nigeria. Primary data were obtained with the aid of structured questionnaire from a cross section survey of 120 farmers drawn through multi-stage sampling procedure. Descriptive statistics, cost and returns analysis, and Cobb-Douglas regression model were used to analyze data obtained. The results of the analysis showed that majority (90%) of the poultry egg farmers are males with 77.5% of them married. The average age and mean years of experience were 43 and 9 years respectively with majority of them having formal education. The study revealed that the poultry egg production enterprise is profitable in the study area as indicated by the gross margin of N2,118,280.1 and a net income of N2,011,857.16 per one thousand birds per production cycle. The profitability ratios further reveals that for every N1 invested in the enterprise, a farmer earns N 0.45 gross margin and N0.43 net income which are higher than the commercial interest rate of 21%. The return to scale estimate of 0.99 revealed that poultry enterprise in the study area are in the stage II of the production surface The study further revealed that most productive resources excluding the flock size maintained by the poultry egg farmers are being over utilized. The study recommended among others, directional extension services aimed at raising technical knowledge of poultry farmers aimed at effective allocation of productive resources is necessary in order to improve profitability.