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Abstract
Groundnut is one the five widely cultivated oilseed crops in Ethiopia. However, the subsector has been overlooked yet by development program interventions and analysis of its technical as well as economic is lacking far behind. Hence, this study presents economic performance of groundnut production in East Hararghe zone of Oromia regional state. It focuses on technical relationships between groundnut output and different inputs, economic resources use efficiency and cost benefit analysis. The result for the study is based on primary data generated from 86 randomly sampled groundnut farm households at different stage by means of structured and semi-structured questionnaire. From the total of seven explanatory variables to be estimated by using Cobb- Douglas function, quantity of seed labor and livestock in tropical livestock unit were significant at different significance level and they showed positive effect on groundnut output. The economic efficiency of resource used showed the seed, fertilizer and labor were underutilized and land was over utilized.
Article Information
Article History:
Received : 18-03-2013
Revised : 07-06-2013
Accepted : 15-06-2013
Keywords:
Groundnut
Allocative
Economic
Technical Efficiencies
INTRODUCTION
Groundnut is one the five widely cultivated oilseed crops in Ethiopia (Wijnands et al., 2009), Eastern Hararghe zone of Oromia region hold primary position in producing and supplying both domestic and export markets as compared to other parts of the nation (unpublished Ethiopia Export Promotion report, EEP 2004). Groundnut is grown under rain-fed and used for oil extraction, and for confectionary in Ethiopia. Moreover, it generates considerable cash income for several small scale producers and foreign exchange earnings through export for the country (Geleta et al., 2007).
Demand for groundnut is persistently increasing through time in the world markets. Future global demand for groundnut appears to be secure due to snack food markets in North America and the EU as well as in countries where groundnuts are a key ingredient in food preparation, such as Mediterranean, Indian and Asian cuisines (Rios and Jaffee, 2008). The recently franchised plumpy' nut (a peanut based nutritional product available for treatment of severe malnutrition in children age 6 to 24 months) operation in countries like Ethiopia offers additional market opportunities for groundnut producers (Pazderka and Emmott, 2010).Therefore, existing attention of market oriented agricultural policy of Ethiopian government, groundnut is...