Journal of Agriculture and Food Environment

Volume 7(2): 35-44, 2020 Adeoye et al., 2020

Original Research Article

Economic Analysis of Watermelon Production in Ibarapa Central
Local Government Area of Oyo State, Nigeria
*Adeoye, A.S., Jatto, K.A., Abegunrin, O.O., Eniola, O. and Oke, O.O.
Federal College of Forestry
P.M.B. 5087, Jericho Hills
Ibadan, Nigeria
*Corresponding author: saadeoye06@gmail.com; +2348037657876
Received 4th March, 2020; Accepted 6th June, 2020; Corrected 16th June, 2020

Abstract
The study assessed the economic analysis of water melon production in Ibarapa Central Local Government Area
of Oyo State, Nigeria. A multistage sampling technique was used in selecting the respondents. A total number of
eighty respondents were selected in the study area by simple random sampling, and data collected from them
with a well-structured questionnaire. The objectives of the study were to identify the socio-economic
characteristics of the respondents, determine the profitability or otherwise of watermelon production, identify
the factors that affects the yield of watermelon production, and to examine constraints associated with
watermelon production in the study area. The data were analyzed using descriptive statistics, and quantitative
analytical tools such as farm budget analysis and stochastic frontier. The results revealed that the majority of the
respondents (95.5%) were male. Majority of the respondents (68.8%) were aged 30-50 years, which implies that
mature adults dominated the production of watermelon. Majority (96.3%) of the respondents were married. Most
(85.0%) of the respondents had primary education or higher, while 47.5% of the farmers had farmed
watermelons for 1-5. The budgetary analysis revealed that watermelon intercropped with cassava had a higher
gross margin per hectare (₦258,367.02) than sole watermelon farms. However, sole watermelon farm had higher
Benefit Cost Ratio (BCR) of 2.35 than the one intercropped with cassava. This signified profitability in watermelon
production. The problems encountered included inadequate credit and pests and disease infestation. It was
recommended that farmers be organized into cooperative groups by facilitators from the Local Government or
State department of extension services for easier access to loans. Also, there should adequate pest and disease
control from recent research discovery in traditional and biological pest/disease control methods to reduce
production cost.
Key words: Watermelon production, Farm budgetary analysis, Profitability, Technical efficiency

Introduction
Watermelon, Citrullus lanatus is one of the most widely cultivated crops in the world. According
to FAO (2011) statistics, China is the world’s leading producer of watermelon. Nigeria produced
more watermelons in 2011 (139,223 tons) than the leading fresh produce African exporter, Kenya,
which produced 66,196 tons, and South Africa that produced 77,993 tons. There are over 1,200
Copyright © 2020 by The Faculty of Agriculture, Delta State University, Abraka, Nigeria
This is an Open Access publication distributed under the terms of the Creative Commons Attribution 4.0 International License

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Volume 7(2): 35-44, 2020 Adeoye et al., 2020

varieties of watermelon worldwide, and quite a number of these varieties are also cultivated in
Africa (Zohary and Hopf, 2000). Watermelon is a tender, warm season vegetable belonging to the
family Cucurbitaceae. It is enjoyed by many people across the world as fresh fruit. It is highly
nutritious and thirst-quenching, and also contains vitamins C and A in the form of disease-fighting
beta-carotene. Watermelon is rich in carotenoids, some of which include lycopene, phytofluene,
phytoene, beta-carotene, lutein and neurosporene. Lycopene and beta-carotene work in
conjunction with other plant chemicals not found in vitamin/mineral supplements. Potassium,
which is also available in it, is believed to help in the control of blood pressure and, possibly,
prevention of stroke (De Lannoy, 2001).
It thrives very well in most well-drained soils whether clayey or sandy but preferably in sandy
loams. Although China is reported to be the current world largest producer of the commodity
(Huh et al., 2008), watermelon is generally believed to have originated from Africa. Presently,
the largest production of the crop in Nigeria still comes from the northern part. It has however
been established that a good crop could also be achieved in other parts of the country.
Specifically, the southwestern farmers could take advantage the possibility to grow the crop
twice a year to generate additional income and therefore increase their overall annual farm
income. The potentials of watermelon as a cash-generating crop is significant for farmers
especially for those residing near the urban areas. According to Oguntola (2006), watermelon is
the most preferred among five exotic vegetables examined in Ibadan Metropolis of Oyo State,
Nigeria. This was coupled with a recent report that exotic vegetables production generally
generated higher profit, and provided more employment and income to the farmers than those of
indigenous vegetables (Shu’aib et al., 2017). The productivity differences over time, and farming
types can result from a variety of factors including variation in scale or level of production,
farmers’ rationality in resource use, and management practices at the plot level in the northern part
of Nigeria where suitable agro-ecology is found (Bamidele et al., 2008). The potentials of
watermelon as a cash-producing crop are enormous for farmers, especially those residing near the
urban areas (Adekunle et al., 2003). Shortages of horticultural produce especially fruits are often
very acute because of low levels of technology in production, harvesting and storage as well as
increasingly high demand for fruits arising from rapidly improving standards of living (Ndubizu,
2008).
Production of fruit crops such as watermelon has been low despite its nutritional and commercial
value. This low production of watermelon calls for a close examination of the profitability of
producing the crop, and analysis of the resources used in its production. In this study, the
parameters employed to assess the economic analysis of water melon production in Ibarapa Central
Local Government Area, Oyo State were as follows; the socio-economic characteristics of the
respondents, profitability of water melon production, factors that affected the yield of water melon
production, and the constraints associated with water melon production in the study area.

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Volume 7(2): 35-44, 2020 Adeoye et al., 2020

Methodology
Study area
The study was carried out in Oyo State, which lies within the tropical zone in the rain forest region
of southwestern Nigeria. The study was carried out in Ibarapa Central Local Government with
headquarters at Igboora, Oyo State. The Local Government Area is bounded in the East by Ibarapa
East Local Government, in the West and North by Ibarapa North Local Government and in the
South by Ogun State. It is located on latitude 8.0ʹʹ N and longitude 4.0ʹʹ E. The area is peculiar for
horticultural crop production, and a large percentage of the inhabitants are farmers. The population
figure of Ibarapa central is was 102,979 (NPC, 2006), with a land mass of 440 km².
Sampling procedure and sample size
A multistage sampling technique was used in selecting the respondents. Ibarapa Local Government
Area was purposively selected, in the first stage, due to its high watermelon-farming population.
In the second stage, a simple random selection of thirty percent of producers from the Local
Government Area was done, giving a total number of eighty respondents that were used for this
study. Data were collected with a well-structured questionnaire.
Method of data analysis
Data were analyzed using descriptive and quantitative statistical techniques. Farm budget analysis
was constructed to estimate the production costs, revenue and gross margin accruable to the
farmers. The equations used in estimating the various parameters are defined below:
GM = TR - TVC …………………. (1)
TC = TFC + TVC ………………… (2)
NP = TR - TC …………………….. (3)
Where:
TC = total cost, TFC = total fixed cost, TVC= total variable cost
GM = Gross margin, TR = Total revenue, NP = Net profit
Depreciation on tools was calculated by the straight line method as follows:
Depreciation = (cost of purchase - salvage value)/ useful life.
Stochastic frontier
The model was employed to examine factors influencing output of watermelon among farmers in
the study area and the technical efficiency of resources employed. The main strength of the model
is that it deals with stochastic noise and permits statistical test of hypothesis pertaining to
production structure and degree of efficiency. Efficient transformation of inputs into output is
characterized by the production function, which shows the maximum output obtainable from
various input vectors. The stochastic production function is defined as:

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Q = f (Xiβ) exp (VI - Ui) ………………………… (4)

Where:
Q = Quantity of Watermelon output
Xi = Vector of input quantities
β = vector of parameters to be estimated,
Exp = exponential function,
VI = random variables,
Ui = non-negative random variables which account for respondents’ socio-economic
factors which are technical inefficiency in production.
The random errors, Vi, are assumed to be independently and identically distributed and
independent of Ui’s. V captures variations in output due to factors outside the control of the farmer
like fluctuations in input prices, and farm size. The U’s are also assumed to be independently and
identically distributed (Meeusen and Van den Broeck, 1977). Technical efficiency (TE) of an
individual farmer is defined as the ratio of the observed output to the corresponding frontier output,
conditional on the levels of inputs used by the farmer. Thus the technical efficiency of farmer i in
the context of the stochastic frontier production function (1) is:
TEi = Yi/Yi* = f (Xi; β) exp (VI - Ui)/f (Xiβ) exp (VI).................... (5)
TE = exp (-Ui) ……………………………………… (6)
Where Yi is the actual output, and Yi* is the frontier output (potential output). The value of the
technical efficiency lies between zero and one. The most efficient farmer will have value one,
whereas the less efficient farmers will have their efficiencies lying between zero and one.
Results and Discussion
Socio-economic characteristics of respondents
The result from Table 1 revealed that most of the respondents (95.0%) were male. This indicates
dominance of male folk in watermelon production. The proportion of respondents less than 51
years old was 72.5%, revealing the presence of young and middle-aged individuals who are known
to be active and innovative. They are also likely to be open to new ideas. Furthermore, majority of
the farmers (96.7%) were married, and are therefore expected to be stable and settled in their
chosen vocation. Majority (85.0%) of the respondents had at least primary education, thus
indicating a high level of literacy in the study area. The mean years of watermelon production
experience was 6 years. This further shows that watermelon production was a newly-introduced
profession of the people in the study area.
Table 2 shows the various sources of credit available to watermelon farmers in the study area. All
the respondents got their credits from personal savings and from other sources of their livelihood,
while 56.3% obtained their credits from cooperatives.

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Table 1: Socio-economic characteristics of respondents (n = 80)

Variable Frequency Percentage
Sex
Male 76 95.5
Female 4 5.0
Age (Years)
Below 30 3 3.7
30-40 29 36.3
41-50 26 32.5
51-60 20 25.0
Above 60 2 2.5
Marital status
Married 77 96.3
Divorced 3 3.7
Educational qualification
No formal education 12 15.0
Primary 19 23.8
Secondary 23 28.8
Tertiary 26 32.4
Experience (years)
1-5 38 47.5
6-10 32 40.0
11-15 10 12.5

Table 2: Sources of credit (n = 80)

Sources *Frequency Percentage
Friends 3 3.8
Family 5 6.3
Government 0 0.0
Banks 29 36.3
Cooperatives 45 56.3
Personal savings 80 100.0
*Multiple responses

Cropping practices employed by the farmers

Table 3 reveals that watermelon was predominantly grown as a sole crop by 52.8% of the
respondents, while 47.2% of them engaged in intercropping watermelon with cassava, maize,
tomato and pepper in the study area. About 73.8% of this category of respondents intercropped
with cassava, 14.3% with maize, 7.1% with pepper and 4.8% with tomato. The major reason given
by the respondents for intercropping watermelon with other crops was improved income (62%).
Although Sugarbaby and Kaolack were the most grown varieties of watermelon in the area,

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majority (96%) preferred the Sugarbaby because of its marketability, sweetness, size and
storability.
With respect to the method of seed planting, it was discovered that direct seeding method was the
most popular technique adopted by most (97.8%) of the sampled farmers.
Majority of the respondents (39.3%) cultivated 1-2 hectares of land. This is an indication that most
of the farmers practiced on a small scale. The table further showed that majority of the respondents
relied on hired labour (50.8%) for their farm operation.
Table 3: Cropping practices adopted by farmers (n = 80)
Characteristics Categories Percentage
Cropping system Sole watermelon 52.8
Watermelon intercrop 47.2
Intercrop System Water melon – cassava 73.8
Watermelon – maize 14.3
Watermelon-pepper 7.1
Watermelon-tomato 4.8
Reasons for intercropping Improved income 62.0
Increased fertility 19.0
Prevention against crop failure 14.0
Maximum use of land 5.0
Watermelon variety Sugarbaby 96.0
Kaolack 4.0
Charlton gray -
Method of seed planting Direct seeding 97.8
Transplanting 2.2
Farm size Below 1 ha 37.1
1-2 ha 39.3
3-4 ha 13.5
5-6 ha 6.7
Above 6 ha 3.4

Costs and returns structure

Estimates of the budgetary analysis for sole watermelon farms and farms containing watermelon
intercropped with cassava are presented in Table 4. The average gross margin generated by sole
watermelon farms was N 232, 918.06 per hectare, which was lower than N 258, 367.02 per hectare
recorded on farms that intercropped watermelon with cassava. Also, the net margin was higher by
about N 25, 448.96 per hectare for farms that intercropped watermelon with cassava. Similar trends
(higher income with intercropping) were also observed by Aihonsu (2002), and this may probably
be the reason why watermelon-cassava intercrop was popular with the farmers. However, the

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benefit to cost ratio of sole watermelon (2.35) was higher than that of the intercropping system
(2.13).
In term of the cost structure, hired labour accounted for almost 90 percent of total variable cost for
both sole watermelon and intercrop enterprises, while seed, fertilizer and chemical costs accounted
for the rest. This probably indicates high labour requirements of agricultural practices.
Watermelon production was profitable based on the fact that an average farm in the area
investigated recorded over 100 percent returns on investment.
Table 4: Average costs and profitability per hectare of watermelon production
Sole watermelon Watermelon-
Variables farms cassava farms
Amount % of Amount % of
Revenue (₦/ha) VC/TVC (₦/ha) VC/TVC
Value of watermelon output 400,000.00 100 350,000.00 73.0
Value of other crops - - 130,108.69 27.0
Total Revenue (TR) 400,000.00 100 480,108.69 100
Variable costs
Seeds 6,000 3.6 14,628.63 6.6
Fertilizer 10,000 6.0 10,000 4.5
Chemicals 1,200.00 0.72 1,200.00 0.54
Hired labour 149,881.94 89.71 195,913.04 88.4
Total variable costs 167,081.94 100 221,741.67 100
Gross margin/ha 232,918.06 258,367.02
Fixed costs
Rent on land 2,000 2,000
Depreciation 1,333 1,333
Total fixed costs 3,333 3,333
Total cost (TC) 170,414.94 225,074.67
Net margin/ha 229,585.06 255,034.02
B:C ratio 1: 2.35 1: 2.13

Factors that influenced output and technical efficiency of watermelon farmers

The result from Table 5 shows the estimated production frontier and technical efficiencies for
watermelon production. Estimated coefficient of labour input was positive and significant at 1%
level. This means that the output increased as the level of these independent variables increased.
This conforms to the findings of Ajibefun et al., (2002), Ajibefun and Abdulkadri (2004), Adebayo
(2006), and Ogundele and Okoruwa (2006). They showed that hired labour contributed positively
to farm productivity in the dry savannah and humid forest agro-ecological zones of Nigeria.
For technical inefficiency effect, the coefficient of household size variable showed a positive
relationship, and was not significant. This suggests that increase in household size slightly

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increased technical inefficiency in the study area. The coefficient of education showed a negative
relationship with the predicted technical inefficiency effect and was significant at 5% level. This
implies that increase in years of schooling reduced technical inefficiency or improved efficiency.
This agrees with the findings of Ajibefun and Abdulkadri (2004); Adetiba (2005); and Kehinde
(2005) that education was key to enhanced productivity among farming households in the humid
forest, dry savannah and moist savannah agro-ecological zones of Nigeria. The positive coefficient
of experience which was significant at 10% level indicates that any increase in years of experience
increased inefficiency. This indicates that more experienced farmers tend to be less efficient in
watermelon production in the study area. This corroborates the findings of Ajewole and Folayan
(2008) that there is was high productivity in the dry season leaf vegetable production among small
holders in Ekiti State, Nigeria. The coefficient of extension visit was also negative though not
statistically significant. This implies that farmers that received more extension visit tended to be
more efficient. The positive coefficient of age also indicates that older farmers tended to be less
efficient in the production of watermelon.
Table 5: Estimate of the stochastic production function
Variable Parameter Coefficient t-value
Frontier production function
Constant βo 0.33 4.54**
Ln seed quantity β1 -0.61 -4.02
Ln chemical quantity β2 -0.14 -1.1
Ln Fertilizer quantity β3 -0.29 -9.74
Ln farm size β4 0.44 6.22
Ln Labour input β5 0.10 4.99***
Technical inefficiency function
Constant бo 0.31 7.7**
Age б1 0.11 1.40
Household size б2 0.11 0.08
Farming experience б3 0.15 1.66*
Extension visit б4 -0.16 -1.03
Level of education б5 -0.84 2.22**
Variance parameters
Sigma square Ϭ2 0.73 5.57
Gamma Γ 0.41 -3.10
Log likelihood Lif -0.66
***, **,* Significant at 1%, 5% and 10% respectively

Constraints to watermelon production

Table 6 contains the constraints to watermelon production in the study area. Inadequate credit
ranked first among the constraints. This is closely followed by pest and disease problem. There
were also problems of inadequate supply of inputs like fertilizer and seed among other constraints
faced in the study areas

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Table 6: Constraints to watermelon production

Constraints Percentage
Inadequate credit 78.0
Pest and disease problem 76.3
Inadequate fertilizer 69.5
Labour shortage 67.8
Inadequate transportation 54.2
Seed procurement 44.1
Marketing problem 39.0
Pilfering 33.9
Inadequate technical know how 23.7

Conclusion and Recommendations

The study revealed that watermelon production was profitable in the study area. The study further
revealed that the production level was significantly influenced by labour input while level of
education was identified as significantly contributing towards increased farmers’ efficiency. Based
on the findings from the study, the following recommendations are made; that farmers be
organized into cooperative groups by facilitators from the Local Government or State department
of extension services for easier access to loans and other production inputs. Also, there should be
adequate pest and disease control using traditional and biological pest/disease control methods to
reduce losses and production costs.
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