Copyright by Delane Emil Welsch 1965 ABSTRACT THE RICE INDUSTRY IN THE ABAKALIKI AREA OF EASTERN NIGERIA, 1964 by Delane Emil Welsch Rice was first introduced in 1942 into the saucer-shaped swamps of Abakaliki, Eastern Nigeria. Since that time production has expanded and processing and distribution systems have developed. The Eastern Nigeria government, through the 19§;:68 Devglgpment Elan, has singled out rice as the food crop on which major developmental efforts will be expended. This dissertation examines the problems of what place rice should have in the Eastern Nigerian economy and how govern- ment policy should be used to attain that place. First, the world rice situation was examined with respect to patterns of production, consumption, and international trade. Cost and quality standards were developed by which Nigeria's potential place in the world rice economy could be measured. Then the patterns of internal (Republic of Nigeria) production and consumption were de- termined, and projections of future demand were made. The next step was to divide the rice industry in Eastern Nigeria into four stages. Field surveys were carried out in each stage to determine the present structure of the rice industry and its potential. The stages and de- limitation in scope of each were: production, saucer-shaped inland swamps in Abakaliki Division; trading and processing, Abakaliki town- ship; distribution, Abakaliki Industrial Area; retail, four large ur- ban areas in Eastern and two in Western Nigeria. Alternative organi- Delane Emil Welsch zations of each stage of the industry were investigated. Both pres- ent and new inputs and their possible sources were considered. The analysis to this point considered non-normative infor- mation. Next, normative information on the situation was considered and a decision making framework designed which weighed both non-norma- tive and normative information in seeking solutions to the rice prob- lems to which this study is addressed. Normative concepts examined and used as criteria involved the goodness of individualism, group achievement, group leadership by consensus, higher standards and levels of living, equal distribution of income and ownership of wealth, full employment, government revenue, economic growth, and welfare, efficiency and profit. Conclusions from the study are as follows: 1. The quantity of rice demanded by consumers in Nigeria could double during each of the next few six year periods. 2. The Abakaliki rice industry in December, 1963, was in adjustment with the world rice economy and had attained that adjust- ment without government influence, control, or expenditure. 3. Abakaliki rice can compete in the Nigerian market and, with improvement in quality, in the West African and world markets. 4. Yam and paddy enterprises are organized as efficiently as they can be with present factors of production. Yams are four times more profitable per acre harvested than paddy, but fallow re- quirements of yams, economic pressures on land, and the economics of rotations have resulted in the inclusion of paddy in the rotation and expansion of paddy production. One-third of the farms have adopted Delane Emil Welsch the most profitable rotation. Further profitable expansion of paddy production is possible on the other two-thirds of the farms. 5. Because no new factors of production have been develop- ed, paddy cultivation is slipping into a low level equilibrium only 20 years after its first introduction. 6. Sources of profitable new factors (improved seed, water control, hand tools, and fertilizer) are readily available. 7. If the new factors are adopted, paddy production could be expanded ten-fold in Abakaliki Division as an important component of economic development. 8. The normative criteria, particularly individualism, equity, fuller employment, growth, and effective decision making, dic- tate that the organization of production and distribution be in the hands of individuals, with one exception. Supplemental irrigation structures servicing groups of farmers will require majority rule, or even more centralized decision making procedures, to replace the less effective group leadership by consensus. 9. The industry is neither a potential source of government revenue nor in need of government investment in direct productive capac- ity. Instead, the government should concentrate on the development and distribution of new technology and in the provision of facilities to service groups of farmers, preferably on an unsubsidized basis. THE RICE INDUSTRY IN THE ABAKALIKI AREA OF EASTERN NIGERIA, 1964 by Delane Emil Welsch A THESIS Submitted to Michigan State University in partial fulfillment of the requirements for the degree of DOCTOR OF PHILOSOPHY Department of Agricultural Economics 1964 ACKNOWLEDGMENTS Sincere appreciation is expressed to Dr. Glenn L. Johnson and Dr. L. W. Witt for guidance and intellectual stimulation during the doctoral. program and encouragement to undertake international- work. Special thanks are due to Dr. Johnson for thesis supervision and for making the year's stay in Nigeria possible. Appreciation is also expressed to the Department of Health, Education and Welfare for financial support throughout the doctoral course of study, and to Michigan State University International Pro- grams for financial support during the year in Africa. A great debt was also incurred to the University of Nigeria Economic Development Institute for the base from which to work; to its staff for profes- sional criticism and encouragement in carrying out the work; and to its external advisors, particularly Professor T. W. Schultz, for ad- vice at a critical point in the research. The assistance of A. G. Leeks, F.A.O. Rome, in assembling materials for the chapter on the world rice economy is gratefullyacknowledged. Appreciation is also expressed to all those in Nigeria who aided immeasurably in the carrying out of field work. These include W. O. Achukwu, J. C. U. Eme, D. R. E. Jackson, B. U. Okoli, and A. N. ngatu of the Ministry of Agriculture; James Leach, Abakaliki Provin- cial Secretary; Edvard Nordrum of NORCAP; all of the U.S.A.I.D. Enugu staff; Frank Moore of the Ford Fopndation; legislators, particularly Hon. 0. O. Nweke and Hon. Nwele, and local councillors; Bill Manthey, ii Peace Corps Volunteer; Simon Eke, an Abakaliki entrepreneur; and most of all, the 30 students who did the interviewing and measured the farms. An additional acknowledgement is made to Bill Miller and Kurt Anschel, fellow graduate students in Nigeria, and their wives, Marie and Sally, whose support and understanding bolstered my morale during trying times. Words alone cannot acknowledge the debt which I owe my wife, Kay, who not only supported and encouraged me throughout graduate study, but also found time to raise a family and to pursue her own academic career . iii TABLE OF CONTENTS ACKNOWLED GENTS I O O I O O O O O O O O O O O 0 LIST OF TABLES O O O O O O O O O O O I O O O O 0 LIST OF ILLUSTRATIONS . . . . . . . . . . . . . Chapter I INTRODUCTION I O O O O O O O O O O O O O O The Problematic Situation. . . . . . . Objectives . . . . . . . . . . . . . . Brief Review of Previous Research and Rice Terminology . . . . . . . . . . Methodology and Theoretical Background . II THE WORIJD RICE ECONOMY. o o o o o o o o 0 General Characteristics of the World Rice Economy. Projections for 1970 . . . . . . . . . Implications for Nigeria . . . . . . . Markets . . . . . . . . . . . . . Comparative Costs . . . . . . . . III RICE IN THE NIGERIAN ECONOMY. ._. . . . . ‘ 0 Patterns of Internal Production and Consumption. Factors Affecting Future Internal Demand. Population. . . . . . . . . . . . Income . . . . . Price . . . . . . . . . . . . . . Other Factors . . Predictions of Future Demand . . . . . Summary. . . . . . . . . . . . . . . . IV STRUCTURE OF THE RICE INDUSTRY IN EASTERN BASIS FOR EMPIRICAL STUDY . . . . . . . . Historical Background . . .~. . . . . Principal Areas and Methods of Cultivation Goverment ACtiVities o o o o o o o 0 Stages of.the Industry . ... . . . . . Areas St‘ldiEd O O O O O O O O O O O 0 iv Page ii viii xii l4 14 22 23 23 28 33 33 4O 40 42 45 48 53 56 57 58 6O 66 68 68 Pagev v THE PROD UC T I ON S TAGE . . 0 0 O O O O O O O I I O O O O O 7 2 Sample Selection. . . . . . . . . . . . . . . . . . . 74 Characteristics of the Farmers. . . . . . . . . . . . 81 Available Resources . . . . . . . . . . . . . . . . . 82 Paddy Production Practices. . . . . . . . . . . . . . 89 Regression Analysis of Paddy Enterprises. . . . . . . 94 Yam Production Practices. . . . . . . . . . . . . . . 113 Regression Analysis of Yam Enterprises. . . . . . . . 120 Costs and Returns for Farms with both Paddy and Yam Enterprises . . . . . . . . . . . . . . . . . . 124 Estimates of Paddy Acreages . . . . . . . . . . . . .p 133 Comparison with World Production Costs. . . . . . . . 138 Summary . . . . . . . . . . . . . . . . . . . . . . . 140 VI THE PADDY TRADING AND PROCESSING STAGE . . . . . . . . . 144 Processing Practices. . . . . . . . . . . . . . . . . 144 Organization of Traders . . . . . . . . . . . . . . . 148 Results of the Survey . . . . . . . . . . . . . . . . 153 Summary . . . . . . . . . . . . . . . . . . . . . . . 162 VII THE DISTRIBUTION STAGE . C O O O O O O O O O O O O O O O 166 Selection of Interviewees . . . . . . . . . . . . . . 166 Estimates of Volume . . . . . . . . . . . . . . . . . 168 Results of the Survey . . . . . . . . . . . . . . . . 170 Summary . . . . . . . . . . . . . . . . . . . . . . . 176 VIII THE RETAILING STAGE- . . . . . . . . . . . . . . . . - . 180 Sample Selection . . . . . . . . . . . . . . . . . . 181 Results of the Survey . . . . . . .‘. . . . . . . . . 182 Retail Only. . . . . . . . . . . . . . . . . . . 184 Retail and Wholesale . . . . . . . . . . . . . . 185 Wholesale Only . . ... . . . . . . . . . . . . . 187 General Observations . . . . . . . . . . . . . . 187 Summary . . . . . . . . . . . . . . . . . . . . . . . 189 IX ALTERNATIVE ORGANIZATIONS FOR TRANSFORMING THE SAUCER- SHAPED SWAMP RICE INDUSTRY IN EASTERN NIGERIA. . . . . . 193 Transforming Traditional Agriculture. . . . . . . . . 193 Production . . . . . . . . . . . . . . . . . . . . . 199 Present Factors. . . . . . . . . . . . . . . . . 199 New Factors. . . . . . . . . . . . . . . . . . . 201 Seed . . . . . . . . . . . . . . . . . . . . 202 Hand tools . . . . . . . . . . . . . . . . . 204 Water control. . . . . . . . . . . . . . . . 206 Pest control . . . . . . . . . . . . . . . . 209 Page Humus and fertilizers. . . . . . . . . . . 210 New varieties. . . . . . . . . . . . . . . . 211 Summary. . . . . . . . . . . . . . . . 211 Organization of Production with the New Factors. 213 Improved small-holding . . . . . . . . . . . 213 Communal holding . . . . . . . . . . . . . . 226 Farm settlement. . . . . . . . . . . . . . . 231 Nucleus plantation . . . . . . . . . . . . . 235 Processing. . . . . . . . . . . . . . . . . . . . . . 237 Present Factors. . . . . . . . . . . . 237 Combining Present and New Factors. . . . . . . . 239 New Factors. . . . . . . . . . . . . . . . . . . 240 Marketing . . . . . . . . . . . . . . . . . . . 242 Present Structure and Functions. . . . . . . . . 243 New Organizations. . . . . . . . . . . . . . . 24S Ownership during processing. . . . . . . . . 245 Producer-processing cooperatives . . . . . . 246 Central wholesale market . . . . . . . . . . 247 Large scale retail outlets . . . . . . . . . 247 Marketing board. . . . . . . . . . . . . . . 248 Summary . . . . . . . . . . . . . . . . . . . . . . . 250 X A DECISION MAKING FRAMEWORK. . . . . . . . . . . . . . . 255 Introduction. . . . . . . . . . . . . . . . . . . . . 255 Normative Considerations. . . . . . . . . . . . . . . 259 Individualism. . . . . . . . . . . . . . . . . . 264 Group Achievement. . . . . . . . . . . . . . . . 266 Group Leadership by Consensus. . . . . . . . . . 268 High Standards and Levels of Living. . . . . 271 Equal Distribution of Income and Wealth. . . . . 272 Full Employment. . . . . . . . . . . . . . . . . 274 Government Revenue . . . . . . . . . . . . . . . 275 Economic Growth. . . . . . . . . . . . . . . 276 Welfare, Efficiency, and Profit. . . . . . . . . 276 smary. O O O O O O O O O O O O O O I O O O O 279 Value Attaining Potentials of Alternative Organiza- tions of the Rice Industry. . . . . . . . . . . . . 280 Production . . . . . . . . . . . . . . . . . . . 281 Processing . . . . . . . . . . . . . . . . . . . 284 Marketing. . . . . . . . . . . . . . . . . . 285 The Industry as a Whole. . . . . . . . . . . . . 287 Basis for Choice. . . . . . . . . . . . . . . . . . . 290 XI SUMMARY, CONCLUSIONS, AND RECOMMENDATIONS. . . . . . . . 293 The Optimum Role for Rice in Eastern Nigeria. . . . . 293 How to Attain the Optimum Role for Rice in Eastern Nigeria . . . . . . . . . . . . . . 296 Recommendations at the Government Level . . . . . . . 300 Production . . . . . . . . . . . . . . . . . . . 300 Processing . . . . . . . . . . . . . . . . . . . 303* Marketing. . . . . . . . . . . . . . . . . . . . 304 vi Specific Recommendations at the Abakaliki Division Level. . . . . . . . . . . . . . . . . . . . . . Production. . . . . . . . . . . . . . . . . . Processing. . . . . . . . . . . . . . . . . . Marketing . . . . . . . . . . . . . . . . . . Recommendations for Further Research . . . . . . BIBLIOGRAPHY O O O O O O O O O O O O O O O O O O O O O O 0 Appendix I questionnaires O O O O O O O O O O O O O O O O O O 0 Farmers Survey . . . . . . . . . . . . . . . . . . Paddy Traders Survey . . . . . . . . . . . . . . . Rice Buyers Survey . . . . . . . . . . . . . . . . Rice Retailers Survey. . . . . . . . . . . . . II Statistical Basis for Calculations of Expansion Potential 0 O O O O O O O O O O O O O O O I O O O O 0 III Research Costs Incurred During This Study . . . . . . vii Page 304 304 307 308 309 311 318 318 324 326' 328 329 330 10. ll. 12. 13. 14. 15. LIST OF TABLES Paddy yields in different latitudes. . . . . . . . . . . . Importance of rice to the internal economies of selected importing and exporting countries. . . . . . . . . . . . . . International market prices of rice in pounds sterling per ton and price indexes I O O O O I O O O O O I O O O O O I O O Milled rice-comparisons of projection of production and consumptions for 1970, and balances, compared with trade POSItIOHS in 1957-59 s o o o o o o o o o o o o o o o o o o 0 Rice markets outside the Far East, trends in consumption, production, and imports. . . . . . . . . . . . . . . . . . . Cost in U. S. dollars of paddy production in selected countries 0 O O O O O I O O O I O I O O O O O O I O I O O O 0 Average prices for paddy, received by producers, 1961, seleCted countries 0 O O O O O O O O O O I O O O O O O O O O Acreage, average yield, and production of paddy,” Nigeria,by regions . . . . . . . . . . . . . . . . . . . . . Estimates of paddy acreage and yield, Eastern Nigeria, 1962 production season . . . . . . . . . . . . . . . . . . . Calculation of milled rice available for consumption in Nigeria, 1963 O O O O O O O O O I O O O O O O O I O O O O O 0 Retail prices of rice and yams in selected Eastern Nigeria markets, 1957-60 s o o o o o o o o o o o o o o o o o o o o 0 Comparative price indices (1957 - 100) for rice and yams for selected markets in the Eastern and Western Regions of Ni- geria, 1958-60 0 o o o o o o o o o o o o o o o o o o o o 0 Division into stratum and 1953 population of sub-units in each stratum, Abakaliki Division . . . .,. . . . . . . . Villages selected for production stage survey, Abakaliki DiViSion O O O I O O O I O O O O O I I O O I O O O I O O O I General characteristics of the 73 farmers interviewed, by stratum and totals, Abakaliki Division, 1963 . . . . . . . . viii Page 16 18 19 24 26 29 31 34 35 36 47 50 75 76 81 Table 16. 17. 18. 19. 20. 21I 22. 23. 24. 25. 26. 27. 28. 29. 3OI Available resources of farmers interviewed by stratum and totals, Abakaliki Division, 1963. . . . . . . . . . . Credit utilization by farmers interviewed, Abakaliki DiViSion’ 1963I I I I I I I I I I I I I I I I I I I I I I I Number of farmers who saved and average amount saved, Abakaliki DiViSion, 19630 I I I I I I I I I I I I I I I I I Paddy production practices of farmers interviewed, Abakaliki Division, 1963. . . . . . . . . . . . . . . . . . Marketing practices of paddy farmers interviewed in Abakaliki DiViSion, 1963. I I I I I I I I I I I I I I I I I Equation 1, regression analysis on a per acre basis of 19 stranger farmer paddy enterprises, Abakaliki Division, 1963. Equation 2, regression analysis on a total enterprise basis of 19 stranger farmer paddy enterprises, Abakaliki Divi- Sion, 1963. o o o o o o o o 'o o o o o o o o o o o o o o o 0 Equation 3, regression analysis on a per acre basis of 31 native farmer paddy enterprises, Abakaliki Division, 1963 . Equation 4, regression analysis on a total enterprise basis of 31 native farmer paddy enterprises, Abakaliki Division, 1963I I I I I I I I I I I I I I I I I I I I I I I I I I I I Labor input by operation for stranger and native paddy farmers, Abakaliki Division, 1963 . . . . . . . . . . . . . Type of planting material and disposition of output, yam farmers interviewed, Abakaliki Division, 1963 . . . . . . . Equation 5, regression analysis on a per acre basis of 38 native farmer yam enterprises, Abakaliki Division, 1963 . . Equation 6, regression analysis on a total enterprise basis of 38 native farmer yam enterprises, Abakaliki Division, 1963 I I I I I I I I I I I I I I I I I I I I I I I I I Inputs, output, and income per acre for 31 native paddy farm records and 38 yam farm records, Abakaliki Division, 1963 I I I I I I I I I I I I I I I I I I I I I I I I I I I Inputs, output, gross and net income for the 22 native paddy-yam farms, Abakaliki Division, 1963 . . . . . . . ix Page .100 .102 .104 .107 .114 .121 .123 .124 .125 Table Page 31. 32. 33. 34. 35. 36. 37. 38. 39. 4OI 41. 42. 43I 44. 45. 46. Net income per acre for paddy and yams at various combinations of price and yield or both . . . . . . . . . . . .127 Alternative rotations; resulting acreages and labor required, family income per farm; population density, family income, and calories per square mile; Abakaliki Division. . . . . . . . . .129 Comparisons between selected areas of the world and Abakaliki Division of cost of production per ton and per acre of paddy, and per cent of cost represented by variable costs. . . . . . .139 Activities in 1963 of a sample of members of three organiza- tions in Abakaliki-town, and characteristics of those who traded paddYI I I I I I I I I I I I I I I I I I I I I I I I I I 154 Buying activities of Abakaliki paddy traders, 1963. . . . . . .157 Cost of transporting paddy per ton-mile by lorry to Abakaliki- town, 1963I I I I I I I I I I I I I I I I I I I I I I I I I I I159 Number who regularly store paddy, length of time stored, and highest tonnage stored, Abakaliki paddy traders, 1963 . . . . .160 Number of respondents, buying trips, average and total volumes, membership affiliations, and distances, by destination, 86 rice buyers, Abakaliki Industrial Area, December, 1963. . . . .169 Type of sale of rice at destination, and products traded in,by destination, 86 rice buyers, Abakaliki Industrial Area, Decem- ber, 1963 I I I I I I I I I I I I I I I I I I I I I I I I I I I172 Sources of milled rice, by destination, rice buyers, Abakaliki Industrial Area, December, 1963 . . . . ... . . . . . . . . . .173 Cost of milled rice at mill and delivered, selling price, mar- gin, and average size of sale for 64 wholesalers, by destina- tion, December, 1963. . . . . . . . . . . . . . . . . . . . . .174 Cost of transporting milled rice from Abakaliki-town to nine different locations by rice buyers, December, 1963. . . . . . .174 Retail market areas surveyed, size of sample and distribution among types of sellers, December, 1963 . . . . . . . . . . . .181 Characteristics of rice sellers in the retail only category in the six markets surveyed, 1963 . . . . . . . . . . . . . . .183 Characteristics of rice sellers in the retail and wholesale category in the six markets surveyed, 1963. . . . . . . . . . .186 Characteristics of rice sellers in the wholesale only cate- gory in the six markets surveyed, 1963. . . . . . . . . . . . .188 x Table 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. Selected data on simple hand tools which could be employed on improved small-holding paddy farms in Abakaliki Divi- 81onI I I I I I I I I I I I I I I I I I I I I I I I I I I I I Estimated irrigation and land development costs for the 3,500 acre Uzo-Uwani irrigated paddy scheme . . . . . . . . . Estimated annual labor requirements per acre and for a 10.5 acre improved small-holding producing one crop of paddy per year, Abakaliki Division, with comparative 1963 data I I I I I I I I I I I I I I I I I I I I I I I I I I I I Estimated budget:fin:10.5 acre improved small-holding produc- ing one crop of paddy per year, Abakaliki Division. . . . . . Estimated annual labor requirements per acre and for 5.25 and 10.5 acre improved small-holdings producing two crops of paddy per year with supplemental irrigation, Abakaliki Divi- SionI I I I I I I I I I I I I I I I I I I I I I I I I I I I I Estimated budget for 5.25 and 10.5 acre improved small-hold- ings producing two crops of paddy per year with supplemental irrigation, Abakaliki Division. . . . . . . . . . . . . . . . Estimated costs and returns from employing a small garden- type tractor for the tillage operation on 5.25 and 10.5 acre improved small-holdings producing two crops of paddy per year with supplemental irrigation, Abakaliki Division. . . . . . . Estimated costs and returns for a typical 100 acre communal paddy production holding, without and with supplemental irrigation, Abakaliki Division. . . . . . . . . . . . . . . . Annual costs and returns for a paddy processing firm in Abakaliki Industrial Area . . . . . . . . . . . . . . . . . . Estimated costs and returns for a reorganized paddy pro- cessing firm in Abakaliki Industrial Area . . . . . . . . . . Value and per cent of consumer expenditure on milled rice in Port Harcourt that accrues to each operation and stage in the Abakaliki rice industry, December, 1963 . . . . . . . . . xi Page .205 I207 .214 .217 .219 .220 .222 .230 .238 .239 .288 LIST OF ILLUSTRATIONS Figure Page 1. Outline map of Abakaliki Division showing the location of the 10 villages selected for study . . . . . . . . . . . . 77 xii CHAPTER I INTRODUCTION The Problematic Situation The Eastern Nigeria Development Plan 1962-68 (hereafter referred to as the plan) places first priority on agriculture with roughly 34 per cent of total planned development expenditure to be made in that sector. With over 50 per cent of the Region's output in the agri- cultural sector alone, it follows that no serious improve- ment in the pace of over-all progress can be made unless very strenuous efforts are made to raise productivity in agriculture. Such increases must manifest themselves not only in the exports but also in food crops: the growth of industry could be retarded if food production (in Nigeria as a whole) is not expanded significantly. The aim is not to make the Region self-sufficient in food but to increase the protein content of the diet and to raise and diversify the production of those crops for which the Region has natural advantages. One of the main objectives of the 1962-68 Plan is therefore the modernisa- tion of agricultural methods through the adoption of im- proved techniques, intensified agricultural education and changes in land tenure. Food crops are dealt with specifically as follows: 12. Food Crops.--In this Plan the proposals for the development of food crops are mainly directed towards the promotion of rice cultivation and rice processing. There 1Eastern Nigeria Development Plan 1962-68. Official Document Number 8 of 1962. (Enugu: Government Printer, 1962), p. 9. 21bid., p. s. is already a noticeable shift from yams to rice in many parts of the Region. This shift is to be encouraged and the Plan makes provision for its encouragement. It is considered important to stimulate food production because of the long gestation period of the investment to be made in the agricultural sector; strong emphasis is therefore laid on bringing a substantially increased acreage under rice production. 13. A four-fold approach to this objective is con— templated. Firstly, an effort will be made through the departmental channels of the Ministry of Agriculture to encourage farmers at present cultivating rice in the Abakaliki area to extend their acreage. A proposed new rice mill is expected, by increasing returns on the crop, to make a significant impression on the farmers. Secondly, rice is under consideration as a major crop for at least one of the planned Farm settlements. Thirdly, the Plan provides for the development of a major scheme in the Cross River area where land at present is largely unculti— vated, and where very large acreages are known to be suit- able for rice cultivation, subject to the organisation of proper drainage and irrigation and the development of access roads. Provision has been made in the Plan for a study in depth of local conditions with a view to the pre- paration of a large mechanised rice planting scheme for the final years of the Development period. Fourthly, there are indications that large tracts of swamp land in the Brass and Degema Divisions are suitable for rice cul- tivation. It is the intention of Government to work closely with the Niger Delta Development Board in this area. Funds have been set aside to permit implementation of schemes which may be recommended by the Board, on the basis of a major survey now being undertaken. Government has also indicated its willingness to welcome outside in— vestors for these projects on terms similar to those apply- ing to participation in industry. An expansion of 50,000 acres of rice is tentatively pro- posed during the period covered by the plan. These statements raise several important economic questions. First, does rice have a "natural advantage" in Eastern Nigeria, parti- cularly in the Abakaliki area? Is this an advantage over the rest of Nigeria, West Africa, other parts of the world, or over all three? Second, is "the noticeable shift from yams to rice" a shift in absolute or in relative terms, can it be documented, and what are the economic factors causing this shift? Should the shift be en- couraged? Should a substantially increased acreage be brought under rice production? Third, if the answers to the previous sets of questions are affirmative, then is the "four-fold approach" the best way to expand the rice industry? In particular, what is the right way to encourage production in the Abakaliki area? This in- volves such questions as,what is the present structure of the rice industry and how is it functioning, what would be the consequences of changing the structure, and what criteria should be used to judge the "best" among possible organizations? These and similar types of questions indicate the nature of the problems facing Eastern Nigeria and indeed all of the newly developing countries using development plans as guides in attempts to accelerate growth of their economies. First, the plan is just that, a plan and not a concrete program. It is primarily a teaching device, designed to create an awareness on the part of government agencies of the need for coordinated attacks on major problems. Second, this is the second plan drawn up for Eastern Nigeria. It represents more study and research than the first, but still is characterized by a paucity of data and lack of detailed appraisals of approaches to major programs. This is not a condemnation of the plan but a statement of fact. This weakness is inherent in plans of all developing countries where systematic collection of data is just beginning, and the research that has been done does not cover the broad spectrum of problems facing the planners.1 Third, planning is dynamic. POpulations may increase at varying rates, and their economies may or may not keep pace. Goals need to be reexamined and readjusted according to needs. Progress of current programs needs to be evaluated and the programs redirected when necessary. Objectives Set Wlthln the context of these considerations of the plan and the previousquestions raised about rice, the problems to which this thesis is directed may be stated as: What place should rice have in the Eastern Nigeria economy and how may government policy be utilized to attain that place? The overall objective of this study then is to find a solution to these problems. Specific objectives are to: At the world level: (1) Examine the world rice economy to determine what position is possible for Nigeria; At the Republic of Nigeria level: (2) Estimate what place rice will have in the Nigerian economy in the next few years; 1See the collection of articles on the Development Plan in The Nigerian Journal of Economic and Social Studies. At the Abakaliki level: (3) Assess the potential of the present structure of the rice industry in meeting this place; (4) Estimate the effects of change in organization at all stages of the rice industry; (5) Draw conclusions within a decision-making framework which weighs both normative and non-normative con- cepts in assessing the consequences of possible alternative government rice policies. There is also an implicit objective in this dissertation. It is the one behind much of the current intellectual effort in the pro- fession and the one that brought this researcher to Africa. It is simply the seeking of answers to the puzzle of how to transform traditional agriculture from a constraint into an important compo- nent of growth for poor economies. Brief Review of Previous Resegggh and Rice Terminology The world rice economy is covered by a large and increasing body of literature. Publications on rice research started in pre- war years, primarily by British agriculturalists. Britain's colonial empire at that time covered much of the rice producing and eating world. Two prominent professional journals, the Empire Journal of Experimental Agriculture and the Journaliof Tropical Agriculture (Trinidad), still contain a high proportion of articles on rice. Since the founding of the Food and Agriculture Organization of the United Nations, world-wide attention has been focused on rice and rice problems. The International Rice Commission has been estab- lished with the objective of promoting national and international action in the technical aspects of production, conservation, distri- bution, and consumption of rice. The Commission reports its find- ings in newsletters and occasional reports. The Rice Section, Commodities Division, Department of Economic and Social Affairs of F.A.O., Rome, has as an ongoing assignment the analysis of the economic aspects of world rice production and consumption and in- ternational trade in rice. A comprehensive three volume study of the world rice economy has just been published, and commodity re- ports on rice are published annually. World attention will be focused on rice in 1965, which has been designated as "International Rice Year." The newly formed International Rice Research Institute, situated at the University of the Philippines, is carrying out re- search on the technical and economic aspects of rice in the Far East. Governments of various major rice countries are also be- ginning to publish results of rice research. The bulk of these studies are farm management investigations. Japan and China (Taiwan) are currently the leaders in this field, but similar studies have been done in seven or eight other countries. The West African Rice Research Station at Rokupr, Sierra Leone, has been in operation for over ten years. Work is sum- marized in annual reports and described in detail in scientific journals. Research is divided into plant physiology, plant breeding, rice processing and storage, soil chemistry and bacteriology, and pests and disease. Cooperation is maintained with the Federal (Nigeria) Rice Research Station, Badeggi, Nigeria. The station at Badeggi is currently carrying out research in plant breeding, agronomy, and processing for all of Nigeria. A sub-station at Warri is investigating soil problems in the mangrove swamps. Work at Badeggi is published mainly in scientific journals. Rice research in Eastern Nigeria is limited to ferti- lizer trials in various parts of the Region which are directed by the Regional Research Station at Umudike, a small program at the University of Nigeria, and a few field trials at the Abakaliki farm. Rice research in Eastern Nigeria is thus at quite a low level. Social Science research involving rice is likewise at a low level in Eastern Nigeria. The only major study was carried out in 1962 by Dr. P. Von Blanckenburg, UNESCO specialist in Rural Sociology.1 This was a study of the process of introduction of a new crop, rice, in the Abakaliki area. Dr. Blanckenburg analyzed the factors involved in the extension of rice cultivation and briefly reviewed the state and problems of rice farming. Dr. C.A.P. Takes, also an UNESCO expert in Rural Sociology, has studied the "Socio-Economic Factors Affecting the Productivity of Agricul- 2 ture in Okigwi Division." This study provides some insights into sociological problems involved in attempts to shift from subsistence 1Peter Von Blanckenburg, "Rice Farming in the Abakaliki Area," Preliminary Report, Nigerian Institute of Social and Economic Research, Ibadan, Nigeria (Ibadan: October, 1962), 68 pp. 2Charles A. P. Takes, "Socio-Economic Factors Affecting Productivity of Agriculture in Okigwi Division," Preliminary Report, Nigerian Institute of Social and Economic Research, Ibadan, Nigeria (Ibadan: February, 1963), 91 pp. to cash crop farming. The remainder of the research dealing directly with Eastern Nigeria and applicable to rice is mostly contained in visiting con- sultants' reports. Loren Davis, USAID rice consultant, recommends major emphasis on improvement of basic cultural practices on land currently in rice.1 This should come before new lands are devel- oped, and mechanization and Niger Delta rice production should be delayed until existing potential is exploited. A combined Ford Foundation-USAID survey team studying the potential of the Cross River Basin recommended attention to improved processing and fur- ther investigation of present ecological zones of production.2 With respect to processing, considerable investigative work has been done by M. Zwankhuizen, F.A.O. Agricultural Processing Expert.3 His second report is the basis for a proposal to the U.N. Special Fund for a Rice Research Center in Eastern Nigeria.4 This proposed 1Loren Davis, "Status of Rice Production in Nigeria," U.S. Agency for International Development, Consultant Report No. 12 (January 25, 1962), 20 pp. 2J. E. Christiansen, C. L. Scrivner, F. C. Jones, and F. R. Olive, "Preliminary Survey of the Cross River Drainage Basin of Eastern Nigeria," (Enugu: January 12, 1963), 64 pp. 3Melle Th. Zwankhuizen, "Possibilities in Stepping-up Production and in Improving the Processing of Rice in the Eastern Region," Ministry of Agriculture File #773/S.l, Vol. I (1961), and "Development of the Rice Industry in Eastern Nigeria," Ministry of Agriculture Field E. 773/S.l, Vol. I (September 10, 1962), 7 pp. 4Melle T. H. Zwankhuizen, Improvement in Processing and Utiliggtion of Copra, Cassava (Gari), Rice,,and Cashew Nuts Suitable for Adoption in Rural Industries, Food and Agriculture Organization of the United Nations, Report No. 1529 (Rome, 1962). center will concentrate on the agronomic, agricultural engineering, and processing engineering phases of the rice industry. The pro— posal has been approved by the Special Fund and the initial survey team will arrive in early 1965. No studies of the economics of rice production have been made. Dr. Blanckenburg's data on costs are not from a random sample, and as will be shown later, some of his conclusions seem doubtful. His study does however provide a valuable starting point. In reviewing the literature and writing this manuscript a specialized rice terminology was encountered. In order to help the reader, a brief glossary of special terms is given below. These are standard terms, adopted by representatives of nineteen govern- ments and eight organizations at a meeting at Baguia, The Philippines, in 1948. This meeting was one of the first projects of the Inter- national Rice Commission. Rpggh Rice or Paddy: Rice in the husk after threshing. Stalk Paddy: Unthreshed rice in the husk, harvested with part of the stalk. Husked Rice: Rice from which the husk only has been removed; it still retains the bran layers and most of the germs. It is sometimes referred to as brown rice, even though there are varieties having red or white bran coats. Milled Rice: Rice from which the husk, germs, and bran layers have been substantially removed by power machinery. This is known as polished rice in the Western hemisphere. If it is milled to a high degree, it is generally called white rice. 10 ygdermilled Rice: Rice from which the husk, germs, and bran layers have been partially removed by power machinery. This product is termed unpolished rice in the United States. Hand-pounded Rice: Rice from which the husk, germs, and bran layers have been partially removed without the use of power machinery, usually in deep mortars. Coated Rice: Rice milled to a high degree and then coated with a foreign substance such as glucose or talcum. When the coating con- tains a mixture to restore nutrients lost in milling, the rice may be known as enriched rice. Whole-grain Rice: Husked, milled, or hand—pounded rice which does not contain any broken grains smaller than three-fourths of the whole kernel. Broken Rice: Husked, milled, or hand-pounded rice consisting of broken grains smaller than three-fourths of the whole kernel but larger than one-fourth. Various classifications of broken rice are used by the trade, depending on size of grains and amount of foreign material. Brewers Rice: Broken rice smaller than one-fourth of the whole kernel, generally used for industrial purposes. Hggkg: The outermost covering of the rice kernel, removed during milling, and also called hulls or chaff. Bygg: The outer bran layers of the kernel with part of the germ removed during the first run in the milling process. 11 Rice Polishings: The inner bran layers, part of the germ, and a small percentage of the starchy interior, removed during subsequent runs in the milling process. Glutinous Rice: A botanical variety of rice which has a peculiar stickiness after cooking, regardless of how it is cooked. It is milled to various degrees or home-pounded the same as other varieties. Parboiled Paddy: Paddy which has been specially processed by steaming, or soaking in water, heating (usually by steam), and drying. Methodology and Theoretical Background The research plan of this thesis follows the general out- line indicated by the objectives. The world rice economy is re- viewed in Chapter II, stressing important trends and their possible implications for Nigeria. In Chapter III estimates of present pro- duction and consumption and predictions of future demand are made for the Republic of Nigeria. The bulk of the field research is reported in Chapters IV through VIII. The rice industry is divided into four stages and the present organization of each stage is analyzed. Study of the first stage, paddy production, is limited to the inland saucer-shaped swamp area of Abakaliki Division. The second stage study, paddy trading, is limited to those traders operating out of Abakaliki town. Study of the distribution of milled rice is limited to rice buyers who purchase in the Abakaliki Industrial Area. The fourth stage, rice retailing, is studied in four large retail market areas in Eastern Nigeria and two in Western 12 Nigeria. Possible alternative organizations of each stage are examined in Chapter IX. Four alternative organizations of produc- tion (small holdings, communal holdings, nucleus plantations, and farm settlements) are considered, first with present factors of production and then with new factors. The question of supplying new factors is also examined. Alternative Organizations of the other three stages (processing, distribution, and retailing) are discussed, again with attention to both present and new factors. Chapter X focuses on normativquuestions of goodness and badness. Both normative and non-normative concepts are then combined in an attempt to provide realistic solutions to rice production problems of Eastern Nigeria. The conclusions of the study are summarized in Chapter XI. The dissertation reports the results of practical problem solving research. The approach taken is partially based on the following four main bodies of thought. First, the production phase of the study is based on well developed static equilibrium economic theory. Restatement of the theory is not needed, but attention needs to be drawn to assumptions behind the theory to indicate what can and what cannot be done within these limiting assumptions. Second, this study involves dividing an industry into stages, in- vestigating each phase, and then reassembling the stages back into an industry. The meager body of theory dealing with micro-macro relationships and aggregating micro data into macro conclusions is used. Third, the process of accelerating the economy through govern- 13 ment planning in Nigeria and, to a certain extent, throughout the less developed countries of the world in an exercise in management-- management of the resources of the country in an attempt to grow. Management involves decision making. A small beginning has been made in the development of theories of the decision making pro- cess. This dissertation considers and uses what is known and is an example of practical decision making. Fourth, because this the— sis involves men and the problems faced by men, normative considera- tions must be included if solutions to the real problems considered are to be reached. Ideas from various schools of thought in Agri- cultural Economics on handling values are used. Approaches from each school which aid in solving the problems in this thesis are utilized without submitting to the restrictions imposed by any one particular school. The recently published work of Professor T. W. Schultz is reviewed.1 A significant portion of his ideas are woven into the theoretical and empirical work with a view to both further exa- mining Professor Schultz's ideas and to providing deeper insights and possible solutions to the problems of the Eastern Nigeria rice economy. W 1T. W. Schultz, Transforming Traditional Agriculture (New Haven and London: Yale University Press, 1964). CHAPTER II THE WORLD RICE ECONOMY1 Rice is the most important food in the world today. It is the staple food for over one-half of the world's population. Millions more prefer to eat rice when prices and their incomes permit. The debate over the origin of this crop is unsettled, but there is evidence that rice was grown over 5,000 years ago in the Far East. General Characteristics of the World Rice Economy The Far East today is still the home of rice, with about 90 per cent of total world production occurring in that area. While acreage‘ in the Far East continues to expand, its pre-war share of 95 per cent of total production has declined due to increased production in other parts of the world (particularly in the Western hemisphere and Africa). Land abandoned during the war was rapidly brought back into production. By 1948, acreages, and by 1953, total production in the Far East exceeded pre-war levels. 1This chapter draws heavily upon personal correspondence with Mr. A. G. Leeks, Chief, Rice Section, Commodities Division, Department of Social and Economic Affairs, F.A.O., Rome, and publi- cations originating from the Rice Section. 14 15 World production trends in the past 50 years show an in- teresting phenomenon. Total production of paddy has risen from the 1909-13 average of 77 million metric tons to a 1957-59 average of 131 million tons. This increase is due entirely to a rise in hec- tares planted from 48 million to 82 million. The world average yield was practically the same in 1957-59 (16.0 kg. per hectare) as it was in 1909-13 (16.1 kg. per hectare). The disruptive effect of World War II on the world rice economy is shown by the 1945-46 average yield of 12.9 kg. per hectare. This lack of improvement in average world yield in 50 years is heavily influenced by the 90 per cent share of production of the Far East, where average yields have ac- tually declined from 16.0 to 15.7 kg. per hectare over the 50 year period. Yields have increased in most of the rest of the world, with the most spectacular increases in the United States, Egypt, Japan, and Italy. This lack of secular improvement in yields illus- trates the basic fact that most of the world's production is depen- dent on uncontrolled and unreliable water supplies. Grist says that "drainage and irrigation are of paramount importance" in in- creasing paddy yields.1 However, water control measures require capital and the bulk of the paddy producers in the Far East are small farmers who are almost universally short of capital. Grist concludes that the most immediate possibility is in the use of 1D. H. Grist, Rice (3rd ed.; London: Longmans, Green and Co., 1959), p. x. 16 improved seeds, which could possibly raise yields by 25 per cent.1 Some indication of yields and distribution of production by distance from the equator is shown in Table 1. Rice experts TABLE l.-Paddy yields in different latitudesa Latitude ° Average yield Per cent of total world (degrees) : in lb. per acre : area in each category 0 to 10 982 9.4 11 to 20 1010 17.9 21 to 30 1289 64.5 Over 30 1888 8.2 aD. H. Grist,nggg (3d ed.; London: Longmans, Green and Co., 1959), p. 363. generally agree that one of the main factors governing yields is climate. Several reasons have been advanced to explain the fact that the paddy plant is capable of yielding its maximum only under sub-tropical or warm temperate conditions. Most varieties are photoperiod sensitive, and the day length in the growing season in the tropics is not long enough. Second, cold winters may favor- ably influence soil conditions. Third, outside of the tropics paddy is part of a regular rotation, which may also have a favorable ef- fect on yields. The important point remains that these average yields by climate belts are much lower than the potential which could be achieved with known technology. Rice is very important in the internal economics of many countries. Most of the rice is consumed in the countries where it 11bid., p. 366. 17 is produced. Column (2) of Table 2 indicates how important rice is in the diets of selected countries. Only about five per cent of total world production moves across international boundaries. This has several effects on trade in rice. First, fluctuations in pro- duction from year to year magnify price changes within a country, because such a small part of output enters commercial channels. Second, though an even smaller part of production enters interna- tional trade, such trade is an important factor in the balance of payments of individual countries (see columns (3) and (4) of Table 2). These factors cause an inherent instability in the world rice trade. But as shown in Table 3 world prices have been remarkably stable for the past five years. Longer run trends show nearly as much sta- bility. This seemingly contradictory position of unstable output and domestic prices, and stable world prices is explained by the fact that over 50 per cent of the 6 million tons entering the world market moves on government-to-government contracts. Some indication of the extent of government control of trade is shown in column (5) of Table 2. In these countries where rice is so important, government programs have also developed which focus on the paddy farmer. Most of these programs concentrate on improving productiv- ity. In the exporting countries, rice represents such a large part of national income that any acceleration in income growth will require comparable improvements in the rice sector. In the import- ing countries government efforts are generally oriented toward self- sufficiency in paddy production, so that increased internal produc- tion can reduce expenditure of foreign exchange. But, when carried 18 TABLE 2.-Importance of rice to the internal economies of selected importing and exporting countriesa Calories I Value of I Value of I Government . from Rice I Trade in Rice I Rice as % I Activity Countries I as Z of I in Millions I of Total I in Rice ° Total I of US dollarsc I Tradec I Trade . calories I I (1) : (2) : (3) = (4) = (5) Exporters Burma 70 151.9 71 Monopoly Thailand 146.6 43 " Cambodia 21.2 39 d Rep. of Viet Nam 19.2 27 d China: Taiwan 22.6 15 Monopoly British Guina 5.1 9 " Magagascar 44 6.6 8 N.A. U.A.R. 10 25.2 5 Monopoly U.S.A. 0.8 109.9 1 e Importers Ceylon 47 54.3 14 Monopoly Indonesia 82.6 14 " Mauritius 8.4 14 N.A. Pakistan 48 51.1 12 Monopoly Malaya 44.1 8 Senegal 10.7 6 d Cuba 17 38.6 5 Monopoly Hong Kong 42.0 5 d India 34 49.0 3 Monopoly aUnited Nations, Food and Agriculture Organization, Ihg_ World Rice Economy Vol. II: Trends and Forces (Commodity Bulletin Series XXXVI)(Rome, 1963), pp. 2 and 35. U.N.F.A.O. Rice Report 1963 (Rome, 1963), p. 10. b1954-56 average c1957-59 average d . 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Among the cereals, wheat and rice are probably superior foods in consumption to maize, millets, and sorghums. The problem of competition between wheat and rice still exists. On a world-wide basis F.A.O. reports that in areas where the two grains are a rela- tively new food and not fixed by long tradition in diets, rice is considerably more expensive at the retail level than wheat flour. However, Enugu, January, 1964, prices show wheat flour at 10.2 pence and rice at 6 pence per pound. Whether this disparity exists through- out Nigeria is not known. One factor favoring rice is that it is produced locally, whereas all wheat consumed in Nigeria must be im- ported. Other Factors The structure of internal marketing undoubtedly has an in- fluence on the consumption habits of what has been identified as the urban portion of the rice-consuming population. Again it is difficult to separate out influences of price, income, and tastes. Generally speaking, markets in West Africa are characterized by the multiplicity of middlemen. In a later section it will be shown that the ownership 1Some investigators would include the conservatism of Afri- can consumers and the strong influence of habit and custom as factors preventing prediction of future changes in demand. As indicated on page 54, these factors may be highly overrated. 2F.A.O., The World Rice Economy, Vol. 11 (Rome, 1963), p. 70. The areas are West and North Africa, most of Latin America, the Near East (excluding Egypt), western and eastern EurOpe, as well as Japan and Malaya. 49 of rice may change hands as many as five times between producer and final consumer. Each transaction may involve some profit taking so that the marketing margin may be considerable.1 Typically only a small proportion of most foodstuffs produced in Nigeria enters com- mercial market channels. The situation with respect to rice is dif- ferent, however, as a considerable portion of commercially milled rice is marketed. At the present time government exerts no control over rice marketing such as, a Produce Marketing Board, ceiling or floor prices, or subsidies to either producer or consumer. Such con- trols are common in major rice producing and consuming countries. As a result of this absence of control, fluctuations in production of rice are reflected in market prices. However, these fluctuations are much less severe than those for yams, which appear to be the prin- cipal competitor with rice for consumer expenditures on staples. Com- parison of the relative yearly fluctuations in the Eastern and Western Regions between rice and yams are shown in Table 12. Monthly fluctua- tions within each year are much more severe. The higher variation in retail prices of yams is probably due to the fact that only a small proportion of the total production is usually marketed, and variations in production have a magnified impact on quantities available to con- sumers. Thus it appears that the present structure of marketing favors rice over yams, and future improvements in structure will be much more easily carried out for rice than yams. Additional factors which favor 1As was mentioned in Chapter II and will be discussed in detail in Chapters V-VIII,at the present time the profit margin is very low at each level of middleman,except retailing, in the rice trade. Whether this is abnormal or not is not known. 50 TABLE 12.-Comparative price indices (1957 = 100) for rice and yams for selected markets in the Eastern and Western Regions of Nigeria, 1958-60 Market I 1958 I 1959 I 1960 Rice: East:a Enugu 85 105 80 Calabar 83 98 83 Aba 83 95 75 Port Harcourt 90 103 90 Onitsha 92 111 84 West (brown rice)b Ibadan 92 101 104 Abeokuta 82 94 95 Benin 94 93 138 Akure 85 96 80 Yams: East:a Enugu 92 92 92 Calabar 122 115 111 Aba 37 63 78 Port Harcourt 146 154 173 Onitsha 80 72 8O West:b Ibadan 82 84 81 Abeokuta 77 81 90 Benin 90 72 79 Akure 67 67 65 aEastern Nigeria, Ministry of Economic Planning, Statis- tics Division, Statistical Digest of Eastern Nigeria (Ed. 1, No. 22, 1963) (Enugu, E. Nigeria, 1963), pp. 59-60. bWestern Nigeria, Ministry of Economic Planning and Com- munity Development, Statistics Division, Statistical Bulletin Vol. 111, No. 1 and 2 (June and December, 1961) (Ibadan, 1961), pp. 109-110. 51 rice marketing are: storage qualities of rice, particularly in paddy form; higher value per unit weight which means lower proportional transportation costs; and a product that is more readily adapted to standard weights and measures. Animal feed and industrial use are further sources of future demand for rice which are currently untouched in Nigeria. The principal industrial uses of rice in other parts of the world are for brewing and distilling and for starch production. At the present time rice cannot compete cost-wise with cassava as a source of starch in Nigeria. However, the use of rice in the brewing of beer appears to be an excellent prospect. Currently all grains used for brewing are imported. Domestic brewing has been increasing rapid- ly. By 1958, one quarter of all beer and stout sold was produced in- ternally, and this proportion should increase substantially in the next 15 years. Another brewery was opened in 1963. Beer was one of the most sharply income—elastic of all the commodities studied in the E.R.S. report. But utilization of rice for brewing W111 depend upon the development of modern processing facilities which can separate broken rice and brewers rice from the whole grains. By-products from such processing facilities could be utilized as livestock and poultry feed. Raising of poultry has been rapidly expanding in Nigeria, par- ticularly in the Eastern Region. Rice bran, brokens, and old crop paddy could be utilized as poultry feed. These products could also be fed to cattle and hogs. The demand for rice for animal feed and industrial uses will depend primarily on prices relative to maize, Which is the principal competitor for these uses. Current prices 52 favor maize at the retail level. However, the many problems connected with the production and storage of maize, particularly in southern Nigeria, seem to indicate that production cannot be of the scale or at the cost per equivalent unit to allow these commercial usages. All of the factors affecting demand for rice discussed thus far have had one feature in common'— government intervention has not be considered. The nutritional value of rice should be men- tioned in demand considerations. It is a factor which will depend upon government action for its influence. At the present time, the influence of nutrition on consumer mumnulfor various staples appears to be slight. However, nutritional aspects do influence government programs and through mass educational efforts governments can influence consumption. B.M. Nicol, a nutritionist with considerable experience in Nigeria, looks favorably on increased consumption of rice: "If rice can replace the roots now used in such large quantities as a staple food, the protein deficiency in these southern diets would be greatly reduced, if not entirely overcome."l This enthusiasm for rice carries two further qualifications. First, the rice must be par- boiled and not highly milled, or a big loss in vitamins of the B- complex group will occur. Second, rice does not contain as much vitamin-B as millets and sorghums, and replacement of these cereals in the North would result in a nutritional loss with respect to these ‘Vitamins. However, the quality of rice protein is superior to that ‘ 1B.M. Nicol, Feeding_Nigeria (Fed. Inf. Service Pub., Lagos, n.d.), quoted in Johnston, p. 164. 53 of millets and sorghums and clearly superior to maize. Consumers, in the South at least, do not seem to discriminate against parboiled rice. In fact, because rice has been parboiled in the Eastern Region since its first introduction, consumers may have acquired a preference for parboiled rice. During the survey of retailers carried out as part of this thesis, the preference for white rice by their customers was frequently expressed by the retailers.1 Retailers in Ibadan reported that highly polished white rice imported from the United States was much preferred because "it is whiter." At the same time, retailers in Calabar reported that rice from the same source was not preferred by customers because "it is whiter." These contradictory statements may indicate that consumer preferences for rice are not firmly fixed, and that they could be greatly influenced by an educational program pointing out the nutritional advantages of parboiled rice. Predictions of Future Demand What conclusions can be drawn about the effects of these various factors on future internal demand for rice in Nigeria? FirSt, the effects of the factors are interdependent. A change in one factor, such as prices, may cause a change in the competitive position of other foods, which may cause further changes in prices. Second, predictions 0f future demand are speculative even in countries where considerable research on demand has been carried out. The lack of data on demand in Nigeria makes the task much more difficult. The remarks which follow should be interpreted with these weaknesses in mind, namely —_ 1See Chapter VIII- 54 that they are very rough estimates, subStantiated only by meager data, intended only as directions of influence, and heavily influenced by the author's personal impressions. The most exciting prospect for future internal demand is the increasing consumption of rice by rural people. This fact which was uncovered during field work was unexpected and has not been con— sidered previously by demand investigations. Out of the ten villages surveyed, the children in two of the villages eat rice daily, because they like rice better than yams. The impact of a new generation of rice eaters on demand for rice could be staggering. The second most important source of demand may come from a combination of factors which can be labeled changes in consumption tastes or habits. This composite of factors includes relative prices favoring rice over yams, more stable price levels for rice than yams, a shift in distribution of population from rural to urban areas, and rising incomes. A strong doctrine exists with respect to Nigerian consumption habits. The elements of the doctrine are: (1) Nigerian consumers are very conservative and strongly influenced by custom and habit in their consumption of staples, (2) yams are traditionally the preferred staple food; therefore (3) the influence of tradition and social norms on what people eat will prevent any large shift in tastes. Because of a lack of empirical consumption data, this doc- trine has been more or less accepted as fact. It may very well be a myth, and this investigator believes that it is. First, the myth that native people do not respond to economic motives has been largely (jestroyed. Second, if they are "economic men" in production, there 55 is no reason to expect that they are not "economic men" in consump- tion (especially since they have not been exposed to mass consumption advertising such as has occurred in Western countries). When farmers 20 miles out in the bush sell their yam crop and buy rice for their children to eat, at a time when relative prices per calorie favor rice, then it seems evident that the previously stated doctrine is suspect. Such reasoning, plus the continued rural to urban migration, plus a probable rise in the general wage level as a result of the forth- coming government report on wages, plus the increase in the rate of training of skilled and professional personnel, all lead td the conclu- sion that an increase in rice consumption can be expected. Governmen- tal educational efforts emphasizing the nutritional value of rice could greatly strengthen this trend. Among the cereals in West Africa rice and wheat are supe- rior goods compared to maize, millets, and sorghums. Little can be said about consumer preferences between rice and wheat. Relative prices currently favor rice and prices in the future shouid also, since rice is grown internally and all wheat must be imported. How- ever, the world wheat market is dominated by countries which practice export subsidies, so that wheat import prices rarely reflect actual production costs. Any estimate of future demand for industrial use and live- stock feed is purely speculative. These factors will depend not only on the rate of transition from outmoded to efficient milling practices but also on the rate of expansion of breweries and the livestock in- dustry. The demand for brewers rice is present now. The demand for 56 poultry and livestock feed is not. Quantitatively, increases in future demand per year appear to be as follows. Increases in total population will add three per cent to rice consumption. The new generation of rice eaters can rea— sonably be expected to increase rice consumption at a minimum annual rate of three per cent. If the urban population increases at twice the rate of the rural (including bOth natural increase and net migra— tion), this source could result in a one to two per cent increase. Rise in.incomes is an uncertain source, but two per cent per annum seems to be reasonable to expect as the increase in rice consumption from this factor. A quite uncertain source of additional demand lies in Government nutritional efforts. If those consumers who eat rice once a month were to eat it twice a month, consumption would double! A very conservative estimate for results from nutritional education would be on the order of five per cent per annum. The factors men- tioned this far would add a total of 15 per cent per year to rice con- sumption, or a doubling of consumption every six to seven years, with- out considering demand for industrial or livestock usage. Summary There is no surplus of rice in Nigeria. All of current production is consumed in Nigeria, as well as a small amount of imports (about one per cent of total consumption). The prospects are for a rapid expansion in demand. Can production, processing, and distribu- tion be expanded advantageously in pace with demand? The answer to this question is sought in the neXt five chapters. CHAPTER IV STRUCTURE OF THE RICE INDUSTRY IN EASTERN NIGERIA AS A BASIS FOR EMPIRICAL STUDY The first section of this chapter deals with the history of the introduction of a new crop, rice, to Eastern Nigeria. The principal areas and methods of production in Eastern Nigeria are described in the second section. The third section covers govern- ment activities in the rice industry. These three sections de- scribe the rice industry in Eastern Nigeria in general terms. To- gether with previous research reported in Chapter 1, these sections summarize knowledge on the rice industry available at the start of this study. As such, they greatly influenced the design and execu- tion of the study. In section four, the rice industry in Eastern Nigeria is divided into four stages, production, trading, distribution, and re- tailing. Limitations on the scope of the study of each stage are set forth in the fifth section. This chapter thus provides the necessary background for the following four chapers in which the results of the field research are reported. These four chapters represent the empirical analysis of information contained in over 850 individual interviews. 58 Historical Background1 Prior to World War 11, wild and red Species (Q, glaberrima, known locally as "Nupe" rice) of paddy were cultivated in Eastern Nigeria, chiefly in old Onitsha province around Nzam and Anambra Creeks in the regions of the Odah and Omerum rivers. A small amount of paddy was also cultivated in the Rivers area. The advent of the war caused a curtailment of rice imports and concern over possible food shortages. Oryza sativa Linn. specie, Indica subspecie was first introduced in 1942. Fifty-six pounds of Guiana Creole paddy were planted at Abakaliki. The experiment was so promising that the next year a large program of free seedling distribution was carried out, primarily on demonstration plots in villages but also on a few individual farms and communal projects. The 1943 crop was purchased by the government and in 1944 the campaign was extended to more vil- lages. The seedlings were sold on credit, repayment being in the form of paddy at harvest time. Processing demonstrations were carried out. Parboiling, drying, and hand hulling in deep mortars were introduced. Although the principal advantage of parboiling is the increased nutri- tive value of the hulled rice, its introduction was chiefly for the purpose of making hulling easier. The process led to the development of subsidiary industries in and around Abakaliki town, such as the cutting in half of empty 44 gallon drums for parboiling, cutting of 1This section is based on I. Eleji, "Rice Production in Eastern Nigeria." Eastern Nigeria Ministry of Agriculture File E(AR) 770?, no date. B.U. Okoli, "Report on Rice Work in Old Ogoja Province from 1942 to 1955." Eastern Nigeria Ministry of Agriculture File E.77 Vol. II, no date (a short summary of each year's work from 1942 to 1955). x. 59 deep mortars and pestles, and supplying of firewood. By 1948 the quantity of paddy produced exceeded the capae city of hand hulling methods, and the government introduced two Planter's rice mills (a horizontal huller performing both hulling and whitening in one operation) powered by diesel engines. By 1950 ownership of the mills had been transferred to private hands and many more mills had been installed. Paddy has been a cash crop from its first introduction, with cultivators at first consuming little or none of what they pro- duced. The first cultivators were stranger—farmers, i.e., in—migrants not of the same clan as the farmers living in the villages and owning the land. The indigenous farmers were content to rent out swamps, work for wages for the paddy cultivators, grow yams, and keep cattle on their own. The keeping of cattle was a major source of civil agitation and strife in the 1940's and continues so to the present day. Landlords' cattle destroyed paddy, the cattle were killed by the paddy stranger-farmers, and disturbances resulted. Trouble over cattle has occurred as recently as 1960 in the Ishieke sub-clan area with the result that in that area swamps are no longer rented to strang— ers and the indigenous farmers have stopped growing paddy. 60 Principal Areas and Methods of Production1 Four distinct ecological zones are used for the growing of paddy in Nigeria.2 These are: (1) fresh water mangrove swamps, (2) naturally inundated lowlands, (3) non-inundated irrigable low- lands, and (4) rainfed uplands. All four zones are present to vary- ing extents in Eastern Nigeria, and each of the four present substan- tially different problems of technology and farm organization. The tidal fresh water mangrown swamps (120 to 160 inches annual rainfall) present the greatest number of yet unsolved problems.3 Land clearance of the dense mangrove forests is costly. Estimates run as high as 5100-5150 per acre. Perhaps some methods of produc- ing wood pulp from mangrove would leave the land clear. But from one-half to one inch of silt covers an eighteen inch thick fiberous mat in these chikoko soils. These swamps are exposed to tides, and the outgoing tide rapidly removes the silt unless cover is maintained. 1This section draws heavily on J. E. Christiansen, pp..gl., "Preliminary Survey of the Cross River Drainage Basin of Easern Ni- geria" (Enugu, January, 1963), 64 pp. and the following note by Hard- castle. 2J.E.Y. Hardcastle, "Notices on Rice Development Projects, Eastern Region," Eastern Nigeria Min. of Agric. File 774/52, Vol 1, 5 pp. (n.d.). 3This area lies in a 50-75 mile-wide belt along the coast. Water level is influenced by ocean tides. During the dry season the water is brackish, but the heavy rainfall during the rainy season results in fresh water covering the land. Around the mouth of the Niger River the swamps extend further inland and are subject to river floods during the rainy season. The Niger Delta Development Board, Agricultural Division, has the responsibility for experimental work on rice production in that area. 61 A great deal of research has been done at the West African Rice Re- search Station (WARRS) at Rokupr, Sierra Leone, on the technical problems of chikoko soils and some work has been done at Warri in Western Nigeria by a soil chemist from WARRS. In Sierra Leone, empoldering the mangrove swamps allowed control of salinity, reten- tion of silt, and controlled decay of the fiberous mat. However, in Sierra Leone hills and ridges extend to the river banks every half mile or so, permitting empoldering of small areas. In Eastern Ni- geria the terrain is nearly level in the mangrove swamps, greatly increasing the cost of polders and size of area to be empoldered at one time. The lack of higher terrain in the swamps also presents what will probably be the most difficult obstacle to overcome - that of human health. Lack of suitable sites for construction of villages, the extent of malaria in the area, and the prevalence of schistomiasis-bearing snails all appear to limit the development of the mangrove swamps to large scale, wholly mechanized operations. If the technical problems of such operations can be solved, there still remains the problem of no roads in the area to transport the product out and the great difficulty of grain storage in such a humid climate. Therefore, although they definitely are potential areas for paddy production, the tidal fresh water mangrove swamps cannot be considered as practical areas for paddy expansion within the next 10-15 years. The second ecological zone, the naturally inundated low‘ Ilands, can be subdivided in Eastern Nigeria into three areas: (1) fresh water swamp forest, (2) saucer-shaped inland swamps, And 62 (3) lowlands bordering drainage ways. The fresh water swamp forest (90 to 120 inches annual rainfall) covers a broad band between the tidal mangrove swamps and the derived savanah further inland. Ex- cept for the soil problems peculiar to the mangrove swamps, the fresh water swamp forests offer the same problems of clearance, human health, transportation, and storage as do the mangrove swamps, and likewise cannot be considered as a potential paddy growing area within the next 10-15 years. A similar situation exists in Thailand, where there is a large delta with no hills or ridges to permit small pold- ers. The lack of higher terrain has been overcome by building houses on stilts. Transportation is by boats and barges on canals which have been constructed throughout the area. Water level is controlled by dikes and treadmills, windmill and gasoline powered pumps. The naturally inundated saucer-shaped swamps occur within the derived savanah (60 to 90 inches rainfall). This area covers most of the northern tier of provinces (Enugu, Abakaliki, and Ogoja), extends into the northern parts of the next tier of provinces (Owerri, Umuahia, Uyo, and Calabar), and extends into Benue Province of Northern Nigeria to the Benue River. This area, which lies to the east of the Enugu-Awgu escarpment, constitutes most of the Cross River Plain. Three closely related soils account for most of the area with 60 per cent of the soils being gently sloping and imper- fectly or poorly drained. Such soils are readily adapted to paddy production. A geographically distinct, but ecologically similar, area consists of the rainfed swamps of northern Onitsha and south- western Enugu provinces. Although the soils in this area are of 63 impermeable clay, while the Cross River Plain has rather permeable soils derived from laterite, the topography and climate are similar and the two areas may be discussed together from the standpoint of production problems and practices. Nearly all of present paddy pro- duction occurs in these two areas. These saucer-shaped inland swamps are inundated from the onset of heavy rains in June and July until the dry season starts in November. The water is generally still or standing water, except in a few cases where artesian—type seepage occurs from nearby higher areas. The water may disappear during the August break in the rainy season if that break is prolonged. The naturally inundated lowlands bordering drainage ways are at presentrun:in paddy production in Eastern Nigeria, although in Northern Nigeria considerable areas of this type are cultivated. These lowlands are inundated only during the heavy rains, when the water level may reach six feet or greater. Most of these drainage ways are reduced to minute flows or dry up completely from late December to March. Floating varieties of paddy are available which are adapted to these areas, chiefly Oryza glaberrima varieties. Re- search at Badeggi is currently being carried out on suitable floating varieties of Q. sativa for the deep water areas and suitable swamp varieties of Q. sativa for the variable water conditions which are present on the margins of the areas occupied by the floating varieties. It is desirable to restrict cultivation to Q, sativa because of con- EBurner preference for that grain type, its non-shattering character, and the advantages of processing a uniform grain type. The flood Wfilters which cover these lowlands usually do not carry the heavy load 64 of nutrient-rich silt that is common to flood plain rivers in paddy producing areas of the Far East. Gourou suggests that this is due to the fact that watersheds of African rivers lie entirely within the tropics.1 The only major technical problem in the expansion of paddy production to these areas in Eastern Nigeria is the cost of construct- ing levees to control water level. Drainage would probably also have to be carried out. The Cross River Survey team cited large areas of alluvial soils which could be reclaimed in this manner, but did not estimate the area involved or costs and benefits of flood protection. Therefore, these inundated lowlands are not considered as potential paddy producing areas within the next 5 years. The third ecological zone, non-inundated irrigable lowlands (60 to 90 inches annual rainfall), intergrade with the saucer-shaped swamps and inundated lowlands of zone two to the extent that some varieties are adapted to both and some of the production problems are similar. A large scale irrigation project is currently being con- structed at Adani in western Enugu province. The Cross River Survey team found areas along the Cross River and the lower reaches of its tributaries where both soils and topography would be satisfactory and where water supplies might be obtained at reasonable cost. Im- pounded water might be used for a second crop of paddy during the dry season. However, costs and technical feasibility have not been inves- tigated. It appears, at least for one crop of paddy per year, that in an area of over 60 inches of rain per year all potential for 1Pierre Gourou, The Tronical World... (London, 1953), p. 105 n, quoted in Bruce F. Johnston, p. 23. 65 utilizing rainfall should be exhausted before the expense connected with supplemental irrigation is incurred. However, the 60 inches is not all retained, for evapotranspiration is high. Like the inundated lowlands, supplementally’lrrlgated lowlands do not seem to be potential areas for paddy expansion within the next five to 10 years, although their potential in utilizing retained rainfall seems immediate. The fourth ecological zone is the rainfed upland (dryland) paddy producing areas. These areas also intergrade with zone two saucer-shaped swamps and inundated lowlands and zone three non- inundated irrigable lowlands throughout the derived savanah belt. At the present time the upland paddy production in Eastern Nigeria is in the Onitsha to Nsukka area, near Obudu, and in Western Nsit (Annang Province). Some upland paddy is grown in the Mid—West and Western regions. Research results from Badegii show promise of cor- recting both the problems of unsuitable varieties and the lack of sound recommendations on improved cultural practices cited by Davis.1 Davis also points out that weed control, fertilization, and soil con- servation appear to be the most important factors in upland paddy pro- duction. While current research efforts show promise of solving these technical problems within the next 5 years, the comparative economics of upland paddy production versus alternative crops in Eastern Nigeria have not yet been investigated. Therefore, technically, this fourth ecological zone can only be considered as a potential paddy producing area in about five years. 1Loren Davis, "Status of Rice Production in Nigeria," U.S.A.I.D. Consultant Report No. 12 (January, 1962). 66 The same general production practices for swamp paddy are presently used in all paddy producing areas in Eastern Nigeria. Al- though in some small areas seed is broadcast directly into the field, transplanting is the general practice. Seed is sown in nurseries at the beginning of the rainy season. Seedlings are transplanted into the fields four to eight weeks later. The soil in the swamp is turned over by hand hoe either in the dry season or just before transplanting. The swamps may be weeded from none to two times during the growing sea- son. As the grain begins to ripen, children are employed to scare away birds and rodents. Grain is harvested either by cutting near the surface of the ground or right below the head. In the first case the paddy is dried and threshed in the field; in the latter, the drying and threshing occurs in the compound. The general division of labor by sex is as follows: women clear the underbrush and previous crop resi- due; men till the land and plant the nurseries; women and children transplant, weed and harvest; women and men thresh; and men bag and store. Government Activities Government activities in agriculture might be classified as: research and education, directly productive facilities, and price control. Nearly all government activity in the rice industry in Eastern Nigeria has been directed into the first category. The role of the government in the introduction of rice has been discussed. The introduction of mechanical mills in 1948-50 was also in the nature of research, for the mills were sold to private individuals as soon as they were proven to be practical. Current training of extension 67 workers at the School of Agriculture, Umuadike, includes a portion of the time spent at the Abakaliki farm for rice training. Activity in direct production has been limited to seed multiplication for distri- bution to farmers, small scale attempts at land clearance and paddy production in the Rivers area, and the Adani mechanized rice scheme. The latter two activities could well be included under research, for they are largely of an experimental nature. In connection with re- search, the government has actively used the services of visiting rice experts and consultants. The reports of most of these have been dis- cussed. This summary of governmental activities in the rice indus- try illustrates one very important fact. The expansion of paddy produc- tion from zero to 85,000 acres in less than 20 years has been accomp- lished without government intervention in directly productive capacity or in pricing of product or factors. Three of Professor Schultz's four necessary conditions for transforming traditional agriculture were met.1 First, new, profitable, agricultural factors were devel- oped and distributed (rice seed and mills). Second, the new factors were simple enough so that the general low level of education present permitted their utilization. Third, payment for the increased produc- tivity occured through the market. The relevant question at this point is, "Are these conditions currently being met in such a way that the transformation will continue or even accelerate?" _‘ 1Schultz, p. 205. Efforts are being made to meet the fourth (:ondition, technical education. 68 Stages of the Industry The rice industry in Eastern Nigeria can be divided into four stages for analysis. The division is based on changes in owner- ship of the product which usually occur between each stage. The first stage is paddy production. It starts with pre- paration of the soil prior to planting and includes all activities connected with production, harvesting, and threshing. Generally, paddy is sold after threshing or after a short period of storage. Paddy trading is the second stage. Movement from the farm to processing centers, storage, parboiling, and milling are performed in this stage. Although a few individuals have integrated stages one and two, the product is always sold at the end of stage two. The third stage consists of distribution activities. Dur- ing this stage milled rice is moved from the mills to consumption cen- ters. Local terminology for persons engaging in this stage is "big rice buyers." The fourth stage encompasses retail sales to final consumers. There are also cases of small scale Operations integrating stages three and four, but at the end of this stage the product is always in the hands of the final consumer. Areas Studgpg Field surveys were carried out covering each of the four stages in the industry. The production stage survey was limited to Abakaliki Division of Abakaliki Province for several reasons. First, as shown in Table 9, Abakaliki Province represents over one-third of tOtal paddy acreage in the Eastern Region. Second, the ecological 69 conditions in the saucer-shaped swamps in that area are typical of those found throughout the Cross River Plain. Furthermore, ecological conditions are identical with those found in Ogoja Province, with one- fourth of total acreage, and except for sub-soil structure, similar to those in Enugu Province, with one-third of Eastern Nigeria acreage. Thus,over 90 per cent of the present paddy production in Eastern Ni- geria can be represented by Abakaliki conditions. Third, Abakaliki is known as the "home of rice," for it is here that rice (9, sativa) was first introduced into Eastern Nigeria. Thus,production practices have become well established and the local economy is based on rice. Fourth, it was found that a great deal of advance preparation was needed before interviewers could actually go into the field to col- 1ect data. The original research plan to survey both Abakaliki and Afikpo Divisions was therefore reduced to cover Abakaliki Division only. Thus, the results of the survey and conclusions drawn from it are directly applicable only to saucer-shaped swamp paddy produc- tion in Abakaliki Division. But because of similar ecological condi- tions and production practices, it is reasonable to believe that the findings are applicable not only to this type of production through- out the Cross River Plain, but also to northern Onitsha and south- western Enugu Province. Seventeen first year students at the University of Nigeria, Enugu Campus, who are majoring in Agriculture were trained to conduct l:he interviews and measure farm plots for this survey. Twelve of the students had from one to three years' previous experience as agricul- tural extension workers. One of the twelve had been posted in the area 70 surveyed and assisted Dr. Blanckenberg in his study. Although all of the students were Ibo, and the area surveyed is Ibo, in one village the dialect was so different that local interpreters had to be employed. As the area is undeveloped in education, no University students were available from the area. The survey was carried out the week of Decem- ber 15, 1963, while the students were on term break. Five students carried out a follow-up survey the week of March 15, 1964, during second term break. Travel was not difficult as both periods were dur- ing the dry season. The paddy trading stage survey was limited to Abakaliki- township and further to the members of the three organizations of paddy traders. Possibly some independent traders were missed. Here again, the great amount of advance preparation required for interviews dictated this limitation in scope. Arrangements were much more diffi- cult to make for this survey than for the previous one and details are discussed in Chapter VI. Four students were trained. They conducted the interviews for this stage the week of December 15, 1963, with a follow-up in March, 1964. The distribution stage survey was limited to those "big rice buyers" who visited the Industrial Area in Abakaliki Township to purchase milled rice during the first two weeks of December, 1963. All persons entering the area were approached, with about two-thirds responding to interviews. The interviews were conducted by a Peace (Corps Volunteer. He was assisted by a Standard Six graduate employed as an interpreter and aided by one of the more progressive mill operators. 71 The retailing stage survey was carried out in six large re- tail market areas. Aba, Calabar, Onitsha, and Port Harcourt in the Eastern Region and Ibadan and Ilesha in the Western Region are the locations of the market areas surveyed. Ibadan included four, Ilesha and Port Harcourt, three, and Aba, two sub-markets. Selection of numr ber and locations of markets to be studied were based on: (1) impor- tance indicated by pretesting of the distribution stage survey ques- tionnaire, (2) availability of interviewers from these important areas, and (3) research budget limitations. The resulting combination of six markets and nine interviewers (two each in Ibadan, Onitsha, and Aba) were selected. Although Lagos is undoubtedly the largest rice market in Nigeria, it was not surveyed due to restrictiOns (2) and (3). The surveys were conducted during the week of December 15, 1963. CHAPTER V THE PRODUCTION STAGE Paddy is produced in the saucer-shaped swamps of Abakaliki Division by three types of farmers. The types differ in origin (place of birth or kinship ties), place of residence, place of farming, and rights to land. The types are native, village stranger, and Abakaliki- township stranger. A "native" farmer lives and farms in the village of his birth. "Village" must be interpreted loosely, for a characteristic of the Abakaliki area is the wide variation of social structure be- tween clans and geographical areas. Where water is available, typi- cal villages of compounds closely grouped together are present. But much of the area of the Cross River Plain is characterized by little or no ground water available for human consumption. Thus, compounds are scattered, and locations depend upon sources of surface water that last through the dry season. In these cases "villages" refer to kin- ship groups who trace their lineage to a common ancestor. This is most evident with the Ezza people, for an Ezza kinship group of 500 people may be scattered over 50 square miles, with people of other kinship groups also scattered over the same area.1 Thus, a "native" 1On this point see Daryll Forde and G.I. Jones, The Ibo and Ibibio-speaking Peoples of South-Eastern Nigeria (London: Inter- national African Institute, 1950), p. 58. ‘NOte: In the remainder of this thesis, unless specifically stated otherwise, money values are expressed in Nigerian Pounds (one 5 equals U.S. $2.80 at official exchange rate) and tenths of pounds. Weights are expressed in long tons (2,240 lbs.) and hundredweights (cwt, 112 lbs.) 72 73 farmer lives and farms in the "village" of his birth. Depending upon clan, he may have rights to communal land, own land outright, or both. The "village stranger" farmers live in the village in which they farm. These farmers were born and have their kinship ties else- where; many are Ezzas from the southwestern part of Abakaliki Division who have migrated northward, but there are also some from Okigwi Divi- sion. They tend to settle in groups in their new village and consider their real "home" to be the village from which they came and to which they return for ceremonies, etc. Occasionally, the "village stranger" takes a wife in his village. If he lives there for a long time (15-20 years) and has children by his "native" wife, he may be granted rights to communal land. Usually, however, he either owns land outright (purchased from the natives in the village where he lives) or pays cash rent for the land he farms, or both. The Abakaliki Township stranger farmer lives in Abakaliki Township. These farmers are Ibo from the heavily populated western part of the Eastern Region, predominantly Onitsha and Owerri Provinces. They usually also engage in paddy trading (stage two of the rice industry). They pay cash rent for land from one to 50 miles from Abakaliki town. This land is often communally owned land which they rent from village elders. They may also rent land owned by individ- uals. In addition to paddy production, these stranger farmers grow yams, mostly for family consumption. In some cases they have pur- chased land for yam production. 74 Sample Selection Preliminary study, including intensive touring of the area, interviews with the Provincial Secretary, extension workers, Ministry of Agriculture staff, and others with experience in the area, led to the formation of hypotheses that the most important variables with respect to paddy production are: . origin of farmer . degree of vertical integration between phases . production practices (and costs) . yield . proportion of available paddy land in paddy. UIJ-‘UDNH Preliminary study also led to the decision to stratify Abakaliki Divi- sion into four strata, and the further hypotheses that between-stratum variation with respect to these five variables was high, and within- stratum variation was low. The strata are shown in Table 13. Abaka- liki Township and all leper settlements were excluded from the universe. Ishielu stratum corresponds to the Ishielu County Council. It is composed of 6 clans (Orri and Agba clans are combined into one administrative unit). Although largest of the strata in population, this is not an important paddy producing area. Izi stratum corres- ponds to the Izi County Council and is composed of 8 sub-clans of the Izi clan. Considerable paddy is grown in Izi and many of the Abakaliki- town stranger farmers rent land in Izi. Ikwo and Ezza strata consti- tute the Ezzikwo County Council area. This area was divided into two strata because of the great difference between the Ikwo and Ezza clans in social structure, population density, production practices, interest in paddy production, and receptivity to change. Ikwo stratum is the most important paddy producing area in Abakaliki Division. 75 TABLE 13.-Division into stratum and 1953 population of sub—units in each stratum, Abakaliki Division Stratum - : Population (1953 census) 1. Ishielu (148,592) Clans: Effium Group 28,198 Ezzagu 20,148 Ishielu 24,638 Ngbo 48,993 Orri/Agba 26,615 2. Izi (133,393) Sub-clans: Agbaja 18,410 Amachi 9,906 Enyigba (Amagu) 2,912 Igbeagu 20,272 Inyimagu 41,289 Ishieke 21,733, Nkaliki/Achara 6,698 Okpuitumo (Edda) 12,173 3. Ikwo (69,179) Sub-clans: Alike 25,372 Mgbabo 26,505 Umuaka 17,302 4. Ezza (107,193) Sub-clans: Imoha 24,316 Izo Imoha 36,579 Izzikworo 28,860 Kpakpaji 17,438 The strata were sampled disproportionally on the basis of importance of present paddy production. Two villages were selected at random from Ishielu and two from Ezza strata. Three were selected from Izi. Ikwo was further divided into three substrata and one village selected from each. However, because only one sample point was drawn from each substratum, no measure of within substratum 76 variation is possible. Therefore, the analysis of the data from Ikwo can be at stratum level only. The sample was drawn using the 1953 census. Clans, sub- clans, village groups, and villages were listed alphabetically. Cumu- lative totals of total population were made for each stratum. Random numbers between one and the stratum total population were drawn, the number of random numbers for each stratum depending upon the number of villages to be sampled for that stratum. Then villages whose cumula- tive population encompassed the random numbers were selected as sample villages. This gave each village in the universe a chance of being selected proportional to its population. The villages sampled are shown in Table 14 and Figure 1. TABLE l4.-Villages selected for production stage survey, Abakaliki Division Stratum I Clan or Sub-clan I Village Group I Villagea 1 Agba Ohoffia Axnaorie (1) Effium Group Umu Ezeoka Umu Uluka (2) 2 Amachi - Ochabu Izekwe (3) Ibeagu — Alibaruhu (4) Ishieke - Obutara Okwu (5) 3 Mgbabo Amagu Orongha (6) Umuaka Okpuitumo Enyibichiri (7) Alike Echi Alike Ndeleagu (8) 4 Izzikworo Idembia Obulo Idembia (9) Kpakpaji Ezzama Ohainya (10) aNumbers in parenthesis refer to location of each village on the map in Figure 1. 77 FIGURE 1.—Outline map of Abakaliki Division showing the location of the 10 villages selected for study. to . . Enugu " ’ ”‘JK Abakaliki-Towp , ‘ .- to , \\ . ...... v—ovv’ “\/“-'p’ \‘ I .1 ‘.-4' , ’4 .,l Ogoja .’ ‘3 2 I”" 10 I," I 9 {a ’8 ‘I i I I U I I II 6 I .- to ' .7 Afikpo Village numbers correspond to Table 14. Note: hard surfaced road 78 A sample of seven farmers was drawn from each village select- ed. The 1961 voters list for each village was used. The local council- 1or, village head, and village elders were consulted. A farmer was de— fined as one who has (1) the right to decide what to plant on a plot of land, and (2) the right to the produce from the land. Names of farmers who were bedridden tuberculosis cases or lepers were removed from the list as well as farmers who had died or moved away. In some villages, women were also excluded from the list because of require- ment (1), for although they received the produce from the land they farmed, they were allowed to plant only a specified crop. Preliminary studies also indicated that this survey would include only native and village stranger farmers. Therefore, a sepae rate survey, using the same questionnaire,was conducted in Abakaliki town for the Abakaliki-town strangers. Nearly all of these farmers belong to one of three organizations: the Cooperative Rice Mill Society, the City Rice Mill, or the Mill Owners Association. These organizations are described in detail in Chapter VI. Random samples were selected from each organization's membership list. If the member interviewed farmed, a farm schedule was completed; if he traded in paddy, a stage two schedule was completed; and if he did both, both interviews were conducted. Native and village stranger farmers were interviewed the week of December 15, 1963, with a follow-up visit the week of March 15, 1964. Farmer cooperation during interviewing was excellent due to ad- vance preparation. After the villages had been selected, Mr. James Leach, Abakaliki Provincial Secretary, contacted members of Federal 79 Parliament, Eastern House of Assembly, and Eastern House of Chiefs whose constituencies included the 10 villages selected. He informed them of the purpose of the study and asked their cooperation. These men accompanied the author to meet lesser chiefs, village heads, and the local councillor in each village, explaining the purpose of the study, assuring the villagers of their (the elected officials') BPPIOV‘ al of the study, and encouraging the farmers to participate fully. The sample farmers were selected during a second visit. Each village was then visited again at least once during the week prior to the sur- vey, the dates of arrival of the interviewers were reaffirmed, and any questions raised by the farmers were answered. In some villages during the actual interviewing, farmers not in the sample came for- ward asking to be interviewed. In other villages there was still apprehension when the interviewers first arrived. This was probably due to an intensive tax drive initiated by revenue collectors just prior to the survey dates. However, the students in all cases were able to explain the nature of the study to the farmers and obtain their cooperation. The villages of Obulo Idembia and Ohainya were surveyed by a three~man team living at nearby Onueke (on the Abakaliki-Afikpo road). The team required two days to interview seven farmers in a village. The other eight villages were surveyed by two teams of seven men each who lived in the dormitories at the Abakaliki Agri- cultural Farm. Each team had a driver and vehicle and was able to complete one village (seven farmers) in about one and one-half days. The villages ranged from 10 to 32 miles' distance from Abakaliki. 80 Abakaliki-town stranger farmers were interviewed partly by the four-man team interviewing paddy traders, and partly by the Onueke team and one of the seven-man teams after they had completed their respective assignments. Farmer cooperation was not as good as encoun- tered in the villages. There were several probable causes. First, although the presidents of each of the three organizations promised their support, they do not have the degree of control over their meme bers that a village head man has over his villagers. Second, Otten- berg says that these stranger-Ibos, particularly in Abakaliki, are quite mistrustful of fellow businessmen.1 Chubb extends this obser- vation to Ibos in general.2 This mistrust must have extended to the student interviewers, for the author had somewhat better cooperation from strangers whom he interviewed personally. In the follow~up visit in March, it was found that most of the strangers had given correct production and cost data on the first visit but failed to list all of their swamps to be measured. In the folloWbup visits, confidence was established only when the author interviewed the farmers and measured the swamps personally. A third difficulty was in contacting the stranger farmers. Many of them were also paddy traders and were out buying paddy several days each week, some to towns a considerable distance away. Some were also building con- i 1Letter from Dr. Simon Ottenberg, Professor of Anthropology, University of Washington, Seattle, Washington, November 29, 1963. 2L. T. Chubb, Ibo Land Tenure (2d ed.; Ibadan: Ibadan University Press, 1961). 81 tractors during the off-season and were away on business. Characteristicsggf the Farmers The questionnaire used is shown in Appendix I. Table 15 indicates the general characteristics of the farmers interviewed. TABLE 15.-Genera1 characteristics of the 73 farmers interviewed by stratum and totals, Abakaliki Division, 1963 Item I Ishielu f Izi I Ikwo I Ezza E Total number 1 Enterprises Paddy only - l - 1 2 Paddy & yams 10 10 23 3 46 Yams only 4 9 2 10 25 Total 14 20 25 14 73 Origin of farmer Village native 12 20 23 14 69 Village stranger 2 - 2 - 4 Proportion of time spent in farming Full time 8 17 25 12 62 Over half 3 2 - l 6 Under half 3 l - 1 5 The importance of paddy production in Ikwo is clearly shown. The ex- tent of paddy farming in Izi may be understated, for in one of the villages selected, Obutara Okwu (5), only one farmer in the whole village grew paddy. As recently as 1960, nearly every farmer grew paddy but in that year severe civil disturbances occurred because of cattle damange to paddy grown by strangers and, as a result, strangers were refused land and village farmers quit growing paddy. However, the prevalence of similar disturbances throughout Izi may make these proportions relatively valid for all of Izi. 82 The two village strangers in Ishielu (Amorie [1]) are from Okigwi, the two in Ikwo are Ezzas from nearby. All of village (2), Umu Ulaka, are Ezzas, but the farmers interviewed were all born in the present location and are classified as village natives. They all own their land outright however, as their fathers purchased the land from the Effiums when they migrated‘to the present location. Some of the occupations of the 11 other than full-time farmers were customary court judge, school teacher, native doctor, and craftsman. Available Resources Table 16 indicates the resources available for individual farmers. The average farmer has 3.15 man equivalents of labor avail- able for the year (assuming a woman is equal to 0.7 man equivalent and a child is equal to 0.5 man equivalent). Additional labor is available during peak periods to the 56 farmers who exchange labor with other farmers. As this is offset by the obligation to return the labor also during peak periods, there is no net addition to labor available. However, four or five farmers working together may be more efficient in some operations, such as land clearing. The exchange of labor is mainly within age groups. The size of these groups varies from 10 to 25, depending on the size of the village. Ownership of the land farmed shows considerable variation among strata. The high proportion of land owned outright in Ishielu is due to several factors. First, village (2), Umu Uluka, as men- tioned previously is inhabited by Ezzas who are the first generation born in the present location of the village. The generation which 83 TABLE 16.-Availab1e resources of farmers interviewed by stratum and totals, Abakaliki Division, 1963 ._7_ Item I Ishielu I Izi I Ikwo I Ezza I Total number Family labor . Wives 1.4 2.4 2.0 1.4 2.0 Children (total) 3.9 4.7 4.2 3.0 4.1 Children (help farm) 1.3 2.0 1.0 1.5 1.5 Exchange labor Do not 2 4 5 6 17 For paddy only 2 2 l l 6 For yams only 3 9 7 4 23 For both 7 5 12 3 27 Ownership of land All communal 1 5 5 - 11 One-third owned - 3 ll - l4 Two-thirds owned 1 5 7 . 4 17 All owned 12 7 2 10 31 Potential for expansion Source Of land Communal/token rent 6 3 5 2 16 Cash rent 3 9 15 8 35 Both 3 6 5 4 l8 Crops to be grown Paddy l l 4 2 8 Yams 4 l4 5 10 33 Both 7 5 16 1 29 Reason for not expanding Capital 6 11 16 7 39 Labor - 1 - l 2 Land - - l - 1 Other 2 - 1 2 5 _ No reason 2 6 3 4 15 migrated into the area purchased the land outright from the Effium people. The high incidence of owned land in the other village in Ishielu, Amorie, is also probably due to migration into this pre- viously sparsely populated area. Because the immigrants were paying 84 cash for land, the original inhabitants were forced likewise to pur— chase land from the community in order to insure that they had access to fertile land or land favorably located to their compounds. A some- what analogous situation has arisen in all of the strata studied with respect to cash rental of swamps for paddy. The demand of Abakaliki- town strangers for paddy land has led most villages to demand cash rent from their own members if they wish to plant paddy in communally owned swamps. There apparently is no discrimination as to origin of the prospective renter-— the land goes to the highest bidder. The high incidence of owned land in Ezza stratum is appar- ently due to a different cause. Chubb indicates that it is the most densely populated area in Abakaliki Division with 304 persons per 1 At that time there was already emigration of square mile in 1945. Ezzas occurring, and this movement has been increasing. One of the seven farmersixterviewed at Ohainya, village (10), left for Fernando Po the week after the March visit. He not only was the most prosperous of the seven and had the highest paddy yield but also was the "unoffi- cial" local councillor of the group and had some local political power. Chubb describes three stages through which land tenure systems pass in the course of development from initial settlement to high popula- tion density. Chubb quotes Bridges in describing the third and last stage where, Increase of population has made it more or less impossible for one central authority to control individual land tenure 1Chubb, p. 104. 85 and at the same time has driven many away from farming to seek their fortunes abroad, where they have developed more independent ideas.1 Bridges calls this the "suburb" phase, a term which does not seem applicable to the Ezza area because there are no urban areas or even large villages in that area. However, the high population density is evident from the typical one year of bush fallow followed by two to even six years of cropping. Following Bridges' thesis the high incie dence of ownership in Ezza must be due to population pressures causing transfer of authority on land tenure from central to individual control. This is a good example of the dynamic nature of the rules regarding rights to land in the Abakaliki area. Indeed "land tenure,"‘pppngg, is probably not the limiting factor to agricultural advance in Abaka- liki Division. The next question in Table 16, source of land for possible ex- pansion, at first seems to weaken the preceding discussion of land ownership. However, in 8 of the 16 cases of communal or token rent, the land is owned by a full or half brother who has more than he can farm in one year. The next section in Table 16 indicates the crops which would be grown if more land were acquired. Since both paddy and yams are commercial crops in the Division, the individual farmers may have had specific pieces of land in mind which are more suitable for one crop than the other. Unfortunately, this factor was not adequately provided for in the questionnaire. The large number who answered "both" indicates the prevalence of the rotation which will 1A. F. B. Bridges, "Report on Oil Palm Survey" (unpublished Inanuscript, 1939), quoted in L. T. Chubb, pp. 10-11. 86 be discussed at the end of this chapter. An interesting point in the next question is that only one farmer of the 63 who responded to this question is kept from expanding his farming activities by scarcity of land. Since only one answer was solicited, perhaps lack of capital was merely the first of several reasons for some of the respondents. The five "other" answers were "not well." mostly "too old" or Information about the financing of the farm operations (questions 13 though 18 of the questionnaire) was difficult to obtain. In most cases the sum of the responses to questions 13 (how much of your own money did you use in farming) and 14 (amount borrowed) was much less than the sum of the detailed cost of production of paddy and yams (pages four and six of the questionnaire). The amount bor- rowed is probably more reliable than "own money" because of the obli- gation to repay. "Own money" is not reported here but total costs of production of paddy and yams are given with the results of the regres- sion analysis in a later section. Table 17 therefore deals only with the credit used by the farmers interviewed. Proportionately more Ezza farmers used credit than farmers in other strata. The average amount borrowed is overstated for Ikwo because one farmer borrowed 5150 while the other nine ranged from 53 to 528. By eliminating the large borrower the average is reduced to 512.2. The average amount borrowed for all strata would likewise be reduced from 514.2 to 510.2 by eliminating the large borrower (the amount shown in parenthesis). The averages for Ikwo and Ezza are still considerably larger than for Ishielu. 87 TABLE 17.-Credit utilization by farmers interviewed, Abakaliki Division 1963 Item I Ishielu I Izi I Ikwo I Ezza I Total 5 Amount borrowed Average 4.5 8.6 26.0 12.5 14.2 Low 1.25 1.25 3.0 2.5 High 7.0 27.0 150.0 30.0 (10.2) number Farmers Who borrowed 6 7 10 12 35 Who did not 7 ll 15 2 35 No answer 1 2 — - 3 Source Friend/family 6 6 10 l 23 Money Lender - - - 7 7 Organization - 1 - 4 Length of loan (mo.) 5 6 9 11 Interest Under 65 p.c. l 2 1 4 65 p.c. to 100 p.c. 1 2 l 10 13 No interest 5 3 9 1 18 Loan used for Paddy l 1 2 2 6 Yams 1 4 2 - 7 Both 3 2 7 10 22 Ability to borrow Who did this year Yes ' 4 5 6 7 22 No 2 2 4 5 13 Who did not this year Yes 2 4 5 2 13 No 5 7 10 - 22 Source Friend/family 6 7 9 2 24 Money Lender - - l 5 6 Organization - - - 2 2 Membership Cooperative l 1 l 4 7 Esusu 2 2 3 2 9 Bank - - - l 1 None 11 17 21 7 56 88 The sources of credit are quite different for Ezza than for the other strata, particularly the prevalence of money lenders. This factor is well illustrated by the rate of interest paid (rate for the term of the loan, not per annum) with 10 of the 12 borrowers paying from 65 per cent to 100 per cent interest. The average length of time of the loans for Ezza is also longer, with two loans of 18 months' duration. The next item in Table 17 indicates that credit is used for both paddy and yams. Ability to obtain credit is about the same for all strata. The question asked was, "Can you always borrow as much as you need?" The interviews did not reveal why those farmers who could use credit failed to do so. The potential sources of credit indicate the same distribution by stratum as the actual sources used, with Ezza farmers again relying on money lenders. The next section of Table 17 indicates that one-fourth of the farmers be- long to a credit supplying institution with only one using commercial banking facilities. Ezza shows a higher rate of membership. Answers to question 18 regarding savings are of somewhat doubtful reliability. The interviewers experienced considerable diffi- culty in elicting answers to this question. Responses of "no" were often accompanied by the comment, "I haven't harvested my crops yet." Therefore, the amounts given by the respondents answering "yes" may be merely cash on hand or the balance of income from sale of crops after loans have been repaid and other unpaid expenses had been met. There were no relationships between a "yes" response to savings and whether or not the individual used credit for production. All 34 of the "yes" respondents kept the money in their house, so that this 89 amount may be more correctly identified as "cash hoard" or "cash on hand" than savings. The average amount is overstated for Ikwo, as one farmer saved (boarded) 5150 (not the same farmer who borrowed 5150 in Table 17). Eliminating this farmer lowers the average for Ikwo to 59.2 and for all strata to 513.6 (the figures given in parenthesis in Table 18). TABLE 18.—Number of farmers who saved and average amount saved, Abakaliki Division, 1963 Item I Ishielu I Izi I Ikwo I Ezza I Total Number (no.) 6 5 16 7 34 Average amount (5) 17.4 8.9 18.0 23.1 17.6 (9.2) (13.6) dedy Production Practices Current paddy production practices are indicated in Table 19 (questions 19 through 23 of the questionnaire). About one-fourth of the farmers growing paddy use some form of simple water control. These usually are shallow gutters or trenches which divert water out- ward from the center of the swamp. Several farmers have constructed low bunds or ridges to hold water on slopes. The only attempt made to level the soil is the pulling down of old yam mounds, leaving the sur- face still quite uneven. Generally, tree stumps have not been removed. In a few cases where they have, the holes left have not been filled. The overall result is an uneven distribution of water over the surface of the swamp. Near the edges the paddy plants grow essentially in dryland or upland conditions. In the center or low part and in the stump holes paddy plants generally are drowned out. Where the water 90 TABLE 19.-Paddy production practices of farmers interviewed, Abakaliki , Division, 1963 Item I Ishielu I Izi I Ikwo I Ezza I Total number Water control: Yes (simple) 3 3 5 l 12 No: Do not know how - l 2 - 3 One year lease 1 - 2 - 3 Costs too much 1 l 8 - 10 Enough water 4 5 5 4 l7 Fertilizer (none use): Soil rich enough 1 - 2 - 3 Never heard of 4 ll 14 1 30 Lack money 1 - 4 3 8 Cannot get 3 - 1 - 4 Source of seed: Agric. Extension - 3 4 - 7 Own seed lO 3 12 3 28 Apia - 5 6 l 12 Transplant in rows: Yes 1 1 7 3 12 No: Custom 3 3 4 1 11 Contract labor 1 - 4 - 5 Too much work 3 - 3 - 6 Never heard of l 5 4 - 10 Harvest: From top: Get second crop 1 - 4 2 7 Custom - - 6 - 6 Cheaper 2 - ll - 13 From bottom: Less work 4 9 - - 13 Custom - 1 - — 1 Both 1 - - 2 3 level is only one to two inches in depth, heat of the sun causes a rise in water temperature which may be sufficient to damage the plants. The number of farmers "who don't know how" to build or use 91 water control structures is probably understated in terms of effi— cient structures on the contour to maintain a uniform water level. Likewise, the number replying "have enough water" is overstated in terms of adequate water level for optimum growth. None of the farmers interviewed applied fertilizer in the 1963 growing season. Several had used fertilizer in the past but were of the opinion that an increase in yield was outweighed by in- creased weed growth and straw growth which resulted in more lodging. Two-thirds of the farmers had never heard of fertilizer. Only seven farmers purchased seed from the Agricultural Extension Service. Some of the 28 farmers using their own seed had started with pure seed from one to ten years ago. Thus, their seed should be of a good quality for the first or possibly the second year after planting pure seed, but purity probably declines rapidly after that. Seven of the 12 farmers planting apia had never heard of the pure seed program or the advantage of using improved seed. Many of the farmers said that seed often was not available from the extension service and that, when it was available, it was physically very diffi- cult for them to get. All farmers plant nurseries and transplant into the field at six to eight weekscn'huer. A physiological setback to the young seedlings occurs if they are transplanted later than four to six weeks so that this factor probably has an adverse effect on yields. Of the 12 farmers who transplanted in rows,transplanting was done be- fore the heavy rains so that the soil was wet, but there was no stand- ing water. The 32 farmers who did not plant in rows offered various 92 reasons for not doing so. The "labor is contracted" reason means that the task of transplanting a given swamp is let out on contract for a fixed amount. Transplanting in rows takes more time and the labor— ers refuse to do this for the set price. The practice of contracting certain operations for a fixed amount is common in all strata for most operations except nursery work. There are two distinctly different methods of harvesting: harvesting "from the top" and harvesting "from the bottom." Harvest- ing from the top involves grasping six or eight heads and cutting them from the stalk about one or two inches below the head. A small knife with a blade two to three inches long is used. Depending on the stage of ripeness of the head, little shattering occurs and all of the straw is left on the field. In addition a "rattoon" or second crop can be harvested from later tillers. Also, selective harvesting can be practiced with the laborers going over a field several times cutting only the ripe heads each time. ‘The work is done from a 'slightly stooped position. The heads are placed in a small basket weighing about 10 pounds when filled. Laborers are paid a fixed amount for each basket harvested. Harvesting is done by women who on the average earn about one shilling and six pence per day by this method. Harvesting from the bottom consists of grasping a handful of stems and cutting them about two to three inches above the surface of the soil with a cutlass (a matchet-like tool with a thin narrow blade two to three feet long). Two to three times more heads are gathered per cut when harvesting from the bottom rather than from 93 the top. However, because of uneven maturation of the heads, some are overripe and shatter while some are immature and subsequently either mold before threshing or produce lightweight and shriveled kernels. The stalks and attached heads are piled at various places throughout the field. After cutting and piling are completed, the grain is threshed by beating with sticks on woven mats. Although the straw is left in piles on the field, the organic matter is essen- tially lost because the piles of straw are burned at the end of the dry season. In one location the family surrounds each pile as it is burned and catch the rodents which run out. These rodents may be a fairly important source of protein in the family diet in that area. Burning of the straw may have the value of destroying spores of the fungus Piricularia Oryzae which cause blast disease. However, this has not been investigated through research. Paddy is harvested exclusively from the top in Ikwo and from the bottom in Izi. Farmers in Ishielu and Ezza use both methods. An equal number, 13, gave "cheaper" as the reason for using their par- ticular method. The Agricultural Engineer at Abakaliki Farm has con- ducted several trials of each method to determine labor required, but the trials were too small and the data collected were inconclusive. He has advanced the opinion that harvesting from the bottom has caused a high rate of miscarriage among pregnant women. No data are avail- able on this subject. Table 20 indicates that nearly four-fifths of the farmers sell their paddy at their own compound or in the local market. Eight farmers transported their paddy by lorry to the Abakaliki market where 94 TABLE 20.-Marketing practices of paddy farmers interviewed in Abakaliki Division, 1963 Item ° Ishielu ' Izi ' Ikwo ° Ezza ' Total ---------------- number --- — Trader comes to farm - 4 8 - 12 Local market 8 2 13 3 26 Abakaliki market 2 4 l 1 8 Parboil & mill — l - - 1 Reason for not pro- cessing paddy: Do not know how 1 2 9 l 13 Too much labor 4 3 10 2 19 Product too small - - 2 — 2 it was sold to paddy traders. The main reasons given by farmers for not parboiling the paddy themselves and having it milled were lack of knowledge of the technique and the large amount of labor involved. ‘gggression Analysis of Paddy Enterprises From the 48 native farmers interviewed who produced paddy in 1963, 31 usable records of inputs and output were obtained. Of the 23 stranger farmers interviewed, 19 usable records of inputs and output were obtained. The data were subjected to standard regression analysis. Both linear and curvilinear (of the Cobb-Douglas form) pro- duction functions were fitted to four sets of data. The four sets were (1) per acre data, (2) total farm data from stranger farmers, (3) per acre, and (4) total farm data for native farmers. The func- tion giving the best fit and supplemental statistics for each of the four sets of data are reported in the following four tables. The curvilinear function which best fits the stranger paddy per acre data is shown in Table 21. The multiple correlation coeffi- 95 TABLE 21.-Equation 1, regression analysis on a per acre basis of 19 stranger farmer paddy enterprises, Abakaliki Division, 1963 -.020 333 .146x3 '418Xn Y = 1.124 X1 . X2 = 0.63 Interval of minus to plus one standard error of estimate about the ‘mean of 1293 lb. per acre = 892 to 1875 lb. 2 _2 R = 0.71 R Yield per acre in pounds weight Labor per acre in L Rent per acre in L Seed per acre in pounds Total acres >4 N lllllflll Supplemental statistics : X1 X2 X3 Xg : Y Simple correlations: X1 1.000 .498 .689 -.337 .716 X2 1.000 .627 -.502 .656 X3 1.000 -.538 .789 X” 1.000 -.478 Y 1.000 Regression coefficient .333 .146 .418 -.020 Standard error .226b .1243 .238C .092 t-value 1.473 1.172 1.758 -.223 .Arithmetic Mean £12.02 £1.36 75 lb. 28.1 ac. 1542 lb. Geometric Mean (G.M.) £10.29 £0.97 62 lb. 16.4 ac. 1293 lb. M.P.P. at G.M. 42 lb. 195 1b. 9 1b. -.42 lb. MVP at G.M. at paddy price per ton of d 520 £0.38 £1.74 19dd 25 , £0.47 £2.18 24dd 2 30 £0.56 £2.61 29d R deletes .666 .682 .647 .709 8Significantly different from zero at 30 per cent probability level. bSignificantly different from zero at 20 per cent probability level. cSignificantly different from zero at 10 per cent probability level. dStated in pence (d) to facilitate comparison with marginal cost per lb. of seed of 3d for unimproved and 4d of improved seed. TWEIVE pence equals one shilling (8) (U.S. $0.14), 20 shillings equal one Nigerian pound (b) (U.S. $2.80). 96 cient (R) is significant beyond the one per cent level. The coeffi- cient of multiple determination adjusted for degrees of freedom (R2) indicates that about 63 per cent of the variation in output is ex- plained by the four factors in the analysis. The standard error of estimate, (Sy) is quite large. The range of minus one to plus one standard error around the geometric mean of 1,293 pounds of paddy per acre is from 892 to 1,875. The indication that the regression coefficients may be unreliable is substantiated by the fact that only b the coefficient for variable X3, seed, input, is significantly 3, different from zero at the 10 per cent level (two-tailed t-test ap- plied). Reasons for the unreliability of the regression coefficients were discussed by Glenn L. Johnson as part of the sampling problem.1 The formula for the standard error of a regression coefficient (for example, for b1, the coefficient for variable X1) has in the numerator the standard error of estimate and in the denominator the number of observations, the variance of X1, and gigglinu—s the square of the multiple correlation coefficient between X1 and the other independent variables.2 Johnson points out that "the reliability of the regression 1Glenn L. Johnson, "Classification and Accounting Problems in Fitting Production Functions to Farm Record and Survey Data," 5g- SOEUI'CP— Productivity, Returns to chlede Farm Size, ed. E. O. Heady, G. L. Johnson, and L. S. Hardin (Ames: Iowa State University Press, 1956), pp. 90-96. 2 97 coefficients could be increased substantially if sampling procedures could be devised which would (a) reduce the correlations in the factor- factor dimensions, and (b) increase the standard deviation of the ob- servations on the factors."1 (An additional gain also can be had by increasing n, or number of observations.) The simple correlation (r) between all variables is given in the first section of the supplemental statistics in Table 21. Cor- relation between seed, X , and the other independent variables is high, 3 indicating complementarity with labor and rent (land quality), and substitutability with land area (X Bradford and Johnson suggest 4)° aggregation of variables when close substitutes or complements. In an empirical study, Heady combined inputs if their correlation coeffi- cient exceeds 0.65.3 However, inputs were not combined in the present study because of the difficulty in aggregating such different factors as labor, seed, and land quality. With respect to the second point raised by Johnson, in- creased standard deviation of observations on the factors, this sta- tistic is already as large as the mans of the observations themselves. It was not feasible to raise n, 19, because of research budget limita- tions. 1Johnson, p. 95. 2L. A. Bradford and Glenn L. Johnson, Farm Management Analysis (New York: Wiley, 1953), pp. 143-45. 3Earl O. Heady, "Productivity and Income of Labor and Capital on Marshall Silt Loam Farms in Relation to Conservation Farming," Iowa Agricultural Experiment Station Bulletin 401 (Octo- ber, 1953), p. 533. 98 The unreliability of the coefficients is therefore directly the result of the sampling procedure. This cost was fully realized when the sample was drawn, and it is more than offset by the benefits of obtaining a representative sample. The regression coefficients are unbiased. More important, the means of the observations on the factors and on the output are unbiased. Although estimates of the marginal productivities are not reliable, important insights can be gained. In addition to testing the regression coefficients to see if they are significantly different from zero, an additional test should be made. For an enterprise to be perfectly organized, factors of production should be so combined that the high profit point, or point of maximum profit, in the factor-factor dimension is reached. This means that the cost of employing the last unit of the factor (marginal factor cost or MFC) is just equal to the value of the addi- tional product (marginal value product or MVP), which is produced as a result of adding that last unit of the factor. The second test then is to calculate the coefficient which would be required for MPG to equal MVP for each factor, and test to see if it is significantly different from the coefficient obtained in the regression analysis on the data collected. Applying this test to equation 1, at a paddy price of £25 per ton, the required coefficient for labor is 0.713, which is significantly different from the regression coefficient of 0.333 at the 20 per cent level (two-tailed t-test). The required co- efficient for seed of 0.072 is also significantly different from the given coefficient of 0.418 at the 20 per cent level. The required 99 coefficients for neither rent (land quality) nor land area are signi- ficantly different from the regression coefficients. Thus, reorganiz- ing the average stranger paddy enterprise involves reducing the labor input and increasing the seed input. Whether or not such a suggestion is risky, since the level of confidence is 20 per cent (there are two chances out of ten that the confidence interval used does not in fact encompass the true value of the parameter), can best be evaluated by examining the other three paddy regression equations. The arithmetic mean for the observations on the variable reflects the influence of the larger farms, one being 89 acres. The geometric mean reflects the mode. The R2 deletes, which indicate the coefficient of multiple determination (unadjusted for degrees of free- dom) that would result if that variable would be left out of the analy- sis, show no gain from including size of farm and only slight gains from the other independent variables. Equation 2, stranger paddy on total enterprise basis, is shown in Table 22. All coefficients are significantly different from zero at the 20 per cent level and labor and seed at the 10 per cent level. Eighty-nine per cent of the variation in output is explained by the three variables in the analysis. This is a gain of 26 per cent by fitting the function to total enterprise data over per acre data for the same farms. Simple correlation between inputs is high, ranging from .77 to .93. The total rent category reflects both quantity and qual- ity of land. The geometric mean is below the arithmetic mean (average). The marginal value productivities calculated at the 100 TABLE 22.-Equation 2, regression analysis on a total enterprise basis of 19 stranger farmer paddy enterprises, Abakaliki Division, 1963 Y = .3062 X, .370 x2 .188 x3 .46 2 ._2 R = 0.95 R 8 0.89 Interval of minus to plus one standard error of the estimate about the mean of 9.5 tons = 6.7 to 13.3 tons Where: Y = Total output in tons (T.)(2240 lb.) X1 = Labor in 5 X2 = Total rent (quantity x quality of land) in 5 X3 = Seed in cwt. (112 lb.) Supplemental statistics ‘ x1 3 x2 3 X3 3 Y Simple correlations: X1 1.000 .766 .933 .930 X3 , 1.000 .934 Y 1.000 Regression coefficient .370 .188 .460 Standard error .203b .128a .243b t-values 1.822 1.476 1.897 Arithmetic Mean (A.M.) 5273.0 524.3 9.0 cwt. 14.4T. Geometric Mean (G.M.) 5170.3 515.4 12.7 cwt. 9.4T. MPP at G.M. (T. of paddy) .0264T. .11597T. .34409T. MVP at G.M. at paddy price per ton of 520 50.4 52.4 510.0 25 50.5 53.0 512.5 30 50.6 53.6 515.0 R2 deletes 0.89 0.90 0.89 aSignificantly different from zero at 20 per cent probabi— lity level. bSignificantly different from zero at 10 per cent probabi- lity level. 101 geometric mean indicate that returns from the input of an additional 51 at the margin for labor to be very low, and for total rent and seed inputs to be quite high. Applying the second type of test, as done for equation 1, at the paddy price of 525 per ton, indicates that the required coeffi- cient for labor of 0.717 is significantly different from the regression coefficient of 0.370, and the required coefficient for seed of 0.100 is significantly different from 0.460, both at the 20 per cent level. Maximizing profits on a total enterprise basis would again involve re— ducing total labor input and increasing total seed input. The required coefficient for total rent, which measures both land quality and quan- tity, is not significantly different from the one in equation 2. Equation 3, native paddy, per acre basis, is shown in Table 23. Increased number of observations, increased standard deviations of the observations on the factors, and decreased simple correlation between the factors all combine to make the regression coefficients more reliable than those for the stranger farmer data. Perhaps strang- er farms tend to be more clustered along expansion lines in the factor- factor dimension. The coefficient for size of farm is significantly different from zero at the five per cent level and the coefficients for labor and seed are at the one per cent level. No index of land quality was available because about one-half of the native farmers produced paddy on their own land and did not pay rent. Size of farm appears to have a slight, positive effect on yield per acre. Applying the second type of test to equation 3 involves a slightly different process than for equations 1 and 2. In the first 102 TABLE 23.-Equation 3, regression analysis on a per acre basis of 31 native farmer paddy enterprises, Abakaliki Division, 1963 Y = 323.85 + 4.50 x1 + 3.46 x2 + 42.62 x, R2 = 0.53 i2 = 0.49 Interval of minus to plus one standard error of the estimate about the mean = 1532;: 576 lb. per acre Where: Y = Yield per acre in pounds weight X1 = Labor per acre in man days X2 = Seed per acre in pounds weight X3 = Size of paddy farm in acres Supplemental statistics X1 X2 X3 Y Simple correlations: X1 1.000 .432 -.273 .589 X2 1.000 -.285 .537 X3 1.000 .068 Y ' 1.000 Regression coefficienta 4.50 3.46 42.62 Standard error 1.33C 1.23c 18.29b t-values 3.38 2.81 2.33 Arithmetic Mean (A.M.)a 125 m.d. 140 lb. 3.7 ac. 1532 lb. Geometric Mean (G.M.) 96 m.d. 105 lb. 1.5 ac. 1289 lb. MVP at A.M. at paddy price per ton of: 520 10d 7d 634d 25 lsOd 9d 83 30 132d 11d 986d Cost per unit of input - 3d 2050d R2 deletes 0.34 0.40 0.45 8The regression coefficients are the marginal physical pro- ducts (MPP) at the arithmetic means for the respective inputs in a linear regression equation. bSignificantly different from zero at 5 per cent probability level. cSignificantly different from zero at 1 per cent probability level. dSee footnote c, Table 21, p. 95. 103 two equations labor is stated in value units, i.e., one unit of labor is 51. In equations 3 and 4 the unit of labor is one man day, there- fore required coefficients for various factor costs must be calculated. At a paddy price of 525 per ton, the given coefficient for labor is exactly that required for profit maximization if labor costs one shilling per man day. The required coefficients for labor costs of two and three shillings are 8.96 and 13.44 respectively, both of which are significantly different from 4.53 at the one per cent level. The required coefficients for seed costs of three pence and four pence are 1.12 and 1.49, which are significantly different from 3.40 at the 10 and 20 per cent levels respectively. Since about one-half of the na- tive paddy farmers do not pay rent, the value of land can be taken from the arithmetic mean of 51.36 per acre from the stranger farmer data. The required coefficients are than 86.9 and 121.8 respectively, and both are significantly different from 35.7 at the one per cent level. Recommendations for maximizing profit are as follows. With labor cost of one shilling per man day, present labor input is satis- factory. As 1abor costs rise, labor input should be reduced. With present seed cost of three pence per pound, it would be profitable to increase seed input. If pure seed costing four pence were used, increased seed input would still be profitable. Expanding size of farm would also be profitable, although the reason is obscure. It may be that those farmers with larger acreages are better managers, i.e., more efficient controllers of inputs. Equation 4, native paddy, total enterprise basis, is shown in Table 24. This equation explains about 98 per cent of variation 104 TABLE 24.-Equation 4, regression analysis on a total enterprise basis of 31 native farmer paddy enterprises, Abakaliki Division, 1963 Y = -1147 + 5.90 x1 + 8.69 x2 + 490.96 x, R?- = 0.99 E2 = 0.98 Interval of minus to plus one standard error of the estimate about the mean = 5987 i- 1366 lb. Where: Y - Total output in pounds weight of paddy Total labor input in man days X2 - Total seed input in pounds weight X3 - Size of paddy farm in acres N {—0 ll Supplemental statistics X1 X2 x3 Y Simple correlations: X1 1.000 .686 . .822 .895 X2 1.000 .743 .909 X3 1.000 .908 Y 1.000 Regression coefficienta 5.90 8.69 490.96 Standard error . 0.68b 0.64b 80.07b t-value 8.68 13.49 6.13 Arithmetic mean (A.M.)a 382 m.d. 354 lb. 3.6 ac. 5987 lb. Geometric mean (G.M.) 164 m.d. 159 lb. 1.5 ac. 1981 lb. MVP at G.M. at paddy price per ton of:c 520 lsld ls7d 54.4 25 134d lslld 55.5 30 ls7d 234d L6.6 R2 deletes 0.95 0.89 0.97 aThe regression coefficients are the marginal physical pro- ducts at the arithmetic means in a linear regression equation. bSignificantly different from zero at 1 per cent probability level. CSee footnote c, Table 21, p. 95. 105 in total output. Simple correlations between inputs are higher than in the per acre equation, but all of the regression coefficients are significantly different from zero at the one per cent level. Marginal value productivities at the geometric mean are higher for seed and size of farm than the marginal costs of an additional unit of these inputs. The required coefficients for labor at prices of one, two, and three shillings per man day are 4.48, 8.96, and 13.44, which are significantly different from 5.90 at the five, one, and one per cent levels respectively. To maximize profit on a total enterprise basis, if labor costs one shilling per man day, more total labor should be used, but if labor costs two or three shillings, total labor input should be reduced. The required coefficients for seed at prices of three and four pence per pound are 0.09 and 0.12, which are signifi- cantly different from 0.22 only at the 30 and 40 per cent levels re- spectively. The required coefficients for land area at prices of 50.97 and 51.36 per acre are 0.075 and 0.101, which are both signifi- cantly different from 0.422 at the one per cent level. As in equa- tion 3, it appears that larger farms have more efficient managers. Perhaps the timing of operations is better and on farms with smaller paddy acreage other crops have priority in peak seasons. Examining the four regression equations together, the coefficients for labor are significantly different from zero for equations 1 through 4 at the 20, 10, 1, and 1 per cent levels re- spectively. Also, the required coefficients for MVP to equal MFC are significantly different from the given coefficients for equations 106 l and 2 at the 20 per cent level. For equation 3, at a labor cost of one shilling per man day, the required and given coefficients are iden- tical, but for labor costs of two and three shillings the required co- efficient is significantly different at the one per cent level. For equation 4, at labor prices of one, two, and three shillings, the re- quired coefficients are significantly different at the 25, 20, and 1 per cent levels respectively. Thus, a pattern of labor productivity emerges, even though the degree of significance may make individual regression coefficients seem more unreliable. When either the cost of acquiring more or the opportunity cost for present labor is one shil- ling per man day, then present level of input of labor is at the most profitable level. When either direct or opportunity costs for labor are two or three shillings per man day, then labor inputs should be reduced to maximize profit. The next step is to examine some reasons for this low productivity of labor. The data used in the analysis were on a total labor input basis. Table 25 shows the breakdown by operation for both stranger and native farmers. Computation of man days per operation for the stranger farmers is uncertain because labor is contracted on a piece work basis. Wage rates appeared to be three shillings per man day; however, a rate of two shillings would make the labor input of stranger and native producers identical. Therefore, the percentage figures for the various operations are more comparable and show nearly pro- portional labor input per operation for the two classes of farmers. The one exception is harvest labor. This may be due to the tendency for more strangers than natives to have their paddy harvested from the 107 TABLE 25.-Labor input by operation for stranger and native paddy farmers, Abakaliki Division, 1963 f Stranger 3 Native Item : ha : Man : Z of : Man a : Z of : days : total : days : total Underbrushing 2.6 17 21 21 18 Planting 5.9 40 49 59 49 Cultivating (2.5) (24) Nursery work (0.2) ( 2) Puddling (1.5) (10) Transplanting (1.7) (23) Fencing 0.8 5 7 3 Weeding 1.1 7 9 9 Bird scaring 0.3 2 2 5 Harvest - 1.5 10 12 23 19 Harvesting (1.0) (15) Threshing (0.4) ( 5) Dry & bag (0.1) ( 3) Total 12.2 81bc 100 120 100 d -- (122) —- -- -- Arith. mean 12.0 -- -- 128 -- Geometric mean 10.3 -- -- 102 -- aNumbers in parentheses are best estimates of breakdown by specific operation. bBased on three shillings per man day labor cost. cBased on two shillings per man day labor cost. dFrom regression analysis. bottom. Most of the farmers who were interviewed were not able to separate the labor requirements for individual operations in the planting and harvesting categories. Both the stranger farmers and those natives who hire labor let out these general operations on contract. The data in parentheses in Table 25 are the best estimates of the author on the breakdown by specific operations. Nursery labor 108 appears to be a very small portion of planting labor. Cultivating and puddling, i.e., land preparation, is a heavy user of labor. Un- derbrushing could also be included in this category. A fair estimate of labor input for all land preparation is 60 to 65 per cent of total labor input. This illustrates the important point that when paddy cultivation was introduced, no new hand tools were developed specifi- cally for rice cultivation. The traditional hand hoe, matchet, and cutlass used for yams are also used for paddy without modification. The hand hoe, or .gggngku, has a very short handle and a large circular blade a foot or more in diameter. This type is found only in the Northeastern Ibo area, and the people there are known as Qggngkg, from the name of the hoe.1 This hoe is well suited for making the huge yam mounds common in the area and for turning under weed growth on heavy clay soils in unstumped swamps. The matchet likewise is effective when clearing fallow land where there are many shrubs and growing stumps. Thus the lack of development of new tools specifically for paddy is tied to the failure to completely clear paddy land which is in turn tied to the maintenance of some fallow period in the rotation. This lack of development of new hand tools also applies to harvesting. An estimate of the breakdown of total harvest labor spent on individual operations is: actual harvest, 15 days; threshing, five days; drying and bagging, three days. This means an average output of 100 pounds of paddy per man day in harvesting and 300 pounds per man day in threshing. Comparable outputs with simple Japanese hand tools are 1Forde and Jones, p. 58. 109 1,500ifiK12,000 pounds per man day, respectively. In other words, an investment of about 546 in hand tools combined with two man days of labor would produce the same output as 20 man days of labor are pro- ducing at present.1 Savings in labor costs alone would pay for the machines if used for from 15 to 24 acres.2 When the four equations are examined with respect to seed, the resulting coefficients are significantly different from zero at the 10 per cent level, and in equation 3 at the one per cent level. Furthermore, the required coefficients for profit maximization when seed costs four pence per pound are significantly different from the given coefficients at the 20 per cent level in equations 1, 2, and 3, and at the 40 per cent level in equation 4. Again, even though the degree of confidence is low, the pattern is consistent. The current Ministry of Agriculture recommendation for transplanted paddy in the Abakaliki area is for 40 pounds of seed to be planted in a one-tenth acre nursery which will in turn be trans- planted on one acre of swampland. The stranger farmers used twice and the native farmers three times this amount. It was shown in Table 19 that only one-sixth of the native paddy farmers purchased seed from the Ministry oangriculture, while over one-half used seed from their own previous year's production. The high returns to in- creasing rates of seeding might thus be explained by low seed quality, 1Correspondence with Central Commercial Co., Osaka, Japan, indicates that a hand rice plant cutter and a hand thresher can be de- livered for 512.7 and 533.4 respectively. See Table 47, Chapter IX, for details. 2Based on labor costs of three and two shillings per man day respectively. 110 for example, 90 per cent germination of Ministry seed and 25 per cent or less for farmers' seed. But part of the farmers using their own seed had planted Ministry seed a year or two previous. Furthermore, all of the stranger farmers either used Ministry seed or seed produced from Ministry stock the previous year. It is not likely that Ministry seed germinates poorly for germination tests are carried out before distribution to farmers. The most likely reason is that there is a high rate of seedling loss either in the nursery or soon after transplanting. Some stranger farmers plant two or three separate nurseries, at one- month intervals, to insure a supply of good seedlings regardless of' weather uncertainities. Thus effective seed rate would be one-third to one-half that stated in answering the questionnaire. A second possible reason is that the recommended rate of 40 pounds per acre might be too low for the present spacing of stands and seedlings per stand. Very little research on different seeding rates has been done in the Eastern Region. Transplanting is done by making a hole in the soil with the fingers or a stick and putting one or more seedlings in the hole. This is called a "stand." Plant density thus dpends both on Spacing between stands and the number of seedlings in each stand. Work at Badeggi resulted in a 22 per cent increase in yield when stand spacing was reduced from 12 by 12 inches to either six by six or three by twelve inches.1 In the same series 1Th. J. Bredero, "Plant Population Experiments with Trans- planted Swamp Rice in Nigeria," Tropical Agriculture, Vol. 41, No. 2 (April, 1964), pp. 149-51. 111 of experiments it was found that the number of seedlings per stand had no significant effect on yield with two to three being the re- commended rate. A seed rate of 43 pounds per acre was deemed suffi- cient, allowing a safety margin. The Ministry recommendation for the East is nine by nine inch spacing with three or four seedlings per stand. The spacing and number of seedlings per stand varied for the farmers interviewed. A rough estimate is four by four inches and four seedlings per stand. This sub-optimal spacing could be the cause of the high seed rate. It appears that while the Badeggi results may be applicable, some research on plant density is needed in the Abakaliki area. A third possible reason has been suggested by J.C.U. Eme.1 He has observed that seed from a badly lodged crop has low viability. The rice plants in the center of the saucer-shaped swamps where soil nutrients have collected through erosion and water stands even in short dry spells tend to have rank straw growth and consequently lodge. The paddy from these plants are large and would seem to be the desir- able ones to select for seed, but they germinate poorly. As mentioned previously, rent per acre is slightly related to yields for stranger farmers. Whether this reflects differences in land quality, is a result of differences in bargaining power of the strangers, or is a function of distance from Abakaliki is not known. Unfortunately, no suitable index of land quality was developed or available. 1Principal Agricultural Officer, Ministry of Agriculture, Enugu, personal discussion. 112 At the beginning of this study, at the time the sample was selected, it was hypothe91zed that the most important variables with respect to paddy production were: (1) origin of farmer, (2) degree of vertical integration, (3) production practices and costs, (4) yield, and (5) proportion of available paddy land in paddy. Abakaliki Divi- sion was divided into four strata, and an additional stratum of Abaka- liki township stranger farmers was added. The data collected during the survey and discussed on the preceding pages do not support the first four hypotheses. None of the native farmers were vertically integrated, but neither are all of the stranger farmers, in fact, only 60 per cent are. Production practices, costs, and yields vary only slightly between native and stranger farmers. The proportion of land suitable for paddy that is currently in paddy has not been determined. A plan to examine available aerial photographs was not carried out. All of the area has been covered but many of the photos are of poor quality and vary a great deal in time of day, month, and year in which they were taken. The cost of ground surveys, either to interpret the photos or to directly determine acreage of suitable land is prohibitive. In summary, the data subjected to regression analysis indi- cate that paddy enterprises are about as well organized as possible, given present techniques and relative prices. If direct or opportunity costs for labor rise above one shilling per man day, it would be pro— fitable to reorganize the paddy enterprise to use less labor. The data are not conclusive with respect to seed. The cause of the low labor productivity at the margin (even though it is about equal to labor cost) appears to be the tools and techniques used. When paddy 113 was first introduced, the technique of transplanting was also introé duced, but it was not a highly refined technique. The seedlings were not transplanted in rows, making weeding more costly, and probably re- ducing Yields. Paddy fields were not completely cleared and leveled. New hand tools were not developed; instead traditional yam cultiva- tional tools are still used. The situation with respect to seed is more complex, for present seeding rates are two to three times as high as officially recommended. The causes may be high rate of seed- ling loss in the nursery, the need for denser plant populations when weeding is not done, or simply that 40 pounds per acre is not enough~ seed for present spacing practices. YgggProduction Practices Yams are the most widely cultivated crop in Abakaliki Divi— sion. Seventy-one of the 73 sample farmers produced yams in 1963 with 25 of them specializing in yams. The importance of yams as‘a cash crop is clearly indicated in Table 26; nearly four-fifths of the farmers sold part of their production. Almost one-half of the farmers sold two-thirds or more of their output. Yam cultivation in Nigeria has been well described by Arthur Waitt and others.1 As Waitt points out, v— 1A. W. Waitt, "Yams, Dioscorea Species," Review Article, Eield Crop Abstrgcts, Vol. 16, No. 3 (August, 1963) PP- 145-57. (The bibliography to this article includes 181 items published since 1901.) A. W. Waitt, "Review of Yam Research in Nigeria 1920- 1961," Federal Department of Agricultural Research Memorandum ' No. 31 (Lagos, 1961). Also personal correspondence. 114 TABLE 26.-Type of planting material and disposition of output, yam farmers interviewed, Abakaliki Division, 1963 Item 3 Ishielu f Izi f Ikwo Ezza Total number Planting material: Seed yams only 1 2 11 l 15 Seed yams, heads, middles and bottoms l3 17 14 12 56 Product is: All consumed 2 3 l 13 One-third sold 5 7 7 5 24 Two-thirds sold 7 9 7 34 \l No one method of yam cultivation can be chosen as typi- cal for the whole yam growing area. There are many reasons for this and the most important is that yams are probably the oldest cultivated crop in southern Nigeria and have there- fore been subjected for a longer period of time and throughout this large area to the whims of the various ethnic groups and their agricultural systems, to different climates and soil types, and to fluctuating economy.1 The following discussion of yam cultivation draws heavily for general descriptions on personal discussions and correspondence with Mr. Waitt and his published materials. Information on specific practices in Abakaliki Division was obtained entirely during the author's field work in the area. Yams (Dioscorea species) are a staple food in the southern Regions of Nigeria and are grown as far north as the tenth parallel. The three principal species are the white yam (Q, rotundata Poir.), the water yam cg. alata L.), and the yellow yam Cg. cayenesia Lamk.). 1Waitt, Memorandum No. 31, p. 4. 115 The white yam is the principal species grown in Abakaliki Division. The yam behaves as an annual, with the vine dying back each year. Regeneration is by a whole or part of a tuber. The planting materials used by farmers are called setts. There are two main types of setts: seed yams (which are whole setts) and cut setts. Cut setts are of three kinds: heads, middles, and bottoms. Seed yams are pro- duced by cutting the rest of the tuber from the head about four to five months after germination. The head (the part nearest the point of attachment to the stem) is left in the soil to regrow and produce seed yams. This process is called "tapping" or "milking."1 The rest of the tuber is removed and is consumed or sold. Using earli- ness and reliability of germination as criteria, the best planting material is seed yams, followed by heads, bottoms, and middles in that order.2 Waitt suggest that heads are less palatable than the remainder of the tuber and this factor, in addition to higher germina- tion, leads to farmer preference for heads over middles and bottoms in some areas.3 Sett type, spacing, and weight are the most important factors affecting yield. About one-fifth of the farmers interviewed planted only seed yams while the remainder planted all four types of setts, as shown in Table 26. Conversations with the farmers after the inter- viewing period indicated that many of the farmers interviewed did not produce seed yams but purchased them from dealers at planting time. 1Ibid., p. 7. 2Ibid. 3Waitt, personal correspondence. 116 It also appears that the dealers are yam farmers who specialize in seed yam production. However, none of the farmers in the sample en- gaged in this practice and its prevalence is not documented. Because of the heavy drain on soil fertility caused by the high weight of tubers produced per acre, it is commonly believed that yams are usually the first crop grown after bush fallow. However, for the sample of farmers in this study, yam after yam, yam after rice, and yam after fallow were observed in about the same propor- tions, so that no generalization is possible. The underbrush or the previous crop residue is cut at the end of the rainy season and burned. The heaps into which the yams are to be planted are piled up as soon as possible to conserve the ashes from the burning. The purpose of the heaps is to provide both a looser soil for greater tuber size and greater aeration which is essential to growth of the yam plant. The size of the heaps varies according to fertility of the soil, soil structure, and water level in the field during the height of the rainy season. In sandy loam uplands the heaps may be only one to two feet high and two to four feet in diameter. In heavy clay swamps, where standing water may reach several feet in depth, the heaps are often five feet high and ten feet or more in diameter. The number of setts planted per heap varied from two to seven according to the size of the heap and fertility of the soil. A frequently ob- served practice was the planting of one or two white yam setts in the top of the heap and three or four water yam or a minor species in the sides of the heap. The larger tubers from the white yam were sold and the smaller tubers from the other species were consumed by the family. 117 The time of planting generally varies in southern Nigeria from November until April.1 In Abakaliki Division no plantings were observed prior to late February and planting was still occurring in mid-April. Waitt mentions that early planted yams are often mulched with dry grass to prevent dessication of the setts, but this was not practiced by the sample farmers.2 Waitt also discusses the need for providing stakes for the vines to climb. The stakes used are rough poles_cut from nearby bush, bamboo, or in some cases small tree or shrub trunks left when the plot was cleared. In Waitt's trials there appeared to be a definite reduction in yield when yams were not staked, but no increase in yield was noted when stakes were longer than seven feet, except for water yams.3 Staking was not universally practiced by the sample farmers. Their decision whether or not to stake appears to be based on the soil type in each particular field. They_stated that for some soils the vines are badly damaged from scorching by the sun, and on these soils the farmers use stakes. On other soils the sun does not damange the vines if left on the ground and the yams are not staked. Data on the proportion of the acreage staked versus unstaked was not collected. In Abakaliki Division yams are often not interplanted with other crops. The presence or absence of interplanting varied both from clan to clan (depending on land availability) and within the clan 1Waitt, Memorandum No. 31, p. 6. 2Ibid. 31bid., p. 10. 118 for individual farmers (depending on distance of the yam plot from the compound). The yam plots are usually weeded only once but may be weeded twice if weed growth is heavy. The practice of three weedings is rare. Yams are harvested in December and early January. Storage is always in yam barns, except for very small plots from which the output will be consumed within several months. Yam barns are usually constructed near the compound. Small poles of one to two inches in diameter are placed in the ground in rows with about six to seven feet of the poles above the surface. The rows are about four feet apart and 20 feet long. Several horizontal rows of small poles are fastened to the upright poles. Another row of poles is placed around the perimeter of the rows to serve as a fence. Yams are carried into the barn at harvest time and each yam is lashed in a horizontal posi- tion to the upright poles with small dry vines or strips of bamboo. Yams of similar size are placed in each part of the barn so that neat- appearing vertical columns are obtained. The largest tubers which will be offered for sale are placed nearest to the entrance. Yams are tied to both sides of the inside rows of poles and to the inside of the perimeter fence. One side of each six feet high by 20 feet long row of yams is called a "line" and sale is by "line,' not by weight. The final step in finishing the yam barn is the construction of an overhead frame of bamboo poles covered with palm fronds to provide shade. The upright poles usually take root and provide a leafy cover over the top. Temperatures inside yam barns are con- siderably lower than in the direct sunlight. A yam barn lasts about 119 four years, after which a new one is constructed, usually in a differ- ent location. Some work on storage of 2, rotundata (white yam) has been done in three locations in Eastern Nigeria by the West African Stored Products Research Unit.1 Yams were found to contain 60 per cent water, 38 per cent carbohydrate and two per cent protein. The yam in storage is a living tuber and respires actively at night but practically not at all during daylight hours. This respirational activity of the tuber was the principal cause of loss of weight, which averaged 10 per cent after three months and 20 per cent after five months of storage. This loss in weight was of both dry matter and water in approximately the same ratio as present in the tubers at the beginning of storage. The moisture content apparently remained in equilibrium with the outside humidity. Respirational activity was slowed considerably either by reducing the temperature to below 70°F or by sealed storage. However, the latter method resulted in an unpalatable product. Thus it appears that research has not been able to improve upon the traditional yam. barn method of storage. Additional factors found to favor yam.barns are that the yams do not touch one another, thereby reducing rotting and eelworm damage, and that the tubers are easily inspected visually in order to remove any that begin to rot. As mentioned previously, a considerable portion of the yams produced in Abakaliki Division are marketed and this proportion prob- ably increases in Afikpo Division. Only the smallest scale farmers 1L.A.W. Hayward and H.M. Walker, Yam Storgge in Nigeria, Document S.F. (62)8 of the CCTA/FAO Symposium on Stored Food, Free- town, (February 20-24, 1962), 5 pp. ' ' 120 carry their yams to the local market for sale. Most of the yams are sold to yam dealers who come to the yam barns to bid for the yams. This is the reason for placing the larger yams for sale nearest the entrance and the smaller ones for home consumption farthest from the entrance. After sale the yams are loaded into lorries for transport to consumption centers. If the yam barn cannot be reached by lorry the farmer is responsible for transporting the yams by head carriage to.amotorable spot. Thus when their compounds are not on motorable roads, the larger farmers tend to build their yam barns either in the field or nearer to the road. But this then requires that watchmen be employed to guard the yam barns. The yam dealers appear to oper- ate on a large scale, often owning one or more lorries. It also ap- pears that they maintain a regular clientele of farmers from whom they purchase yams every year. There were no instances of sale of the standing crop of yams or cash advances of the nature of loans to the farmer by the yam dealer prior to sale. In many cases the yams are not moved out of the yam barn on the day of sale but rather are left in storage for a period of one to six weeks. In this case a cash de- posit on part of the total price is made to the farmer, but this signi- fies transfer of ownership of the yams and is not in the nature of a loan. Regression Analysis of Yam Enterprises From the 71 farmers interviewed who produced yams in 1963, 38 usable records of inputs and output were obtained. The results of the regression analysis on per acre data are shown by equation 5 in Table 27, and that for total yam enterprise data by equation 6 in 121 TABLE 27.-Equation 5, regression analysis on a per acre basis of 38 native farmer yam enterprises, Abakaliki Division, 1963 .087 X .997 .116 Y 3 .3965 X1 2 X3 R2 - 0.63 E2 - 0.60 Interval of minus to plus one standard error of the estimate about the mean of 11,116 lb. - 8,214 to 15,155 lb. Where: Yield per acre in 1000 pounds weight Labor per acre in man days Plants per acre in hundreds (plant density) Size of yam enterprise in acres N ._- IIIII Supplemental statistics 3 x1 3 x2 3 x3 . Y Simple correlations: X1 1.000 .064 -.522 .058 X2 1.000 -.005 .711 X3 1.000 .160 Y 1.000 Regression coefficient .087 .997 .116 Standard error .081a .136c .061b t-value 1.064 7.326 1.899 Arithmetic Mean (A.M.)e 108 m.d. 19.68 (91.) 2.5 ac. 12.50 (1b.) Geometric Mean (G.M.) e 84 m.d. 18.41 (pl.) 1.5 ac. 11.26 (1b.) MPP at G.M. (lb. of yams) 11.6 lb. 6.0 lb. 863.0 lb. MVP at G.M. at yam price per ton of: 5 9.3 180d 6d 53.6 14.0 ls4d 9d 55.4 R2 deletes 0.62 0.05 0.59 aSignificantly different from zero at 30 per cent probabi- 1ity level. bSignificantly different from zero at 10 per cent probabi- lity level. CSignificantly different from zero at 1 per cent probabi- lity level. dSee footnote c, Table 21, p. 95. eA.M. and G.M. for X2 and Y are in units of 100 plants and 1,000 pounds respectively. 122 Table 28. A curvilinear function gave the best fit to the per acre data. As with the paddy production functions, better fits were ob- tained on the total enterprise data than on the per acre data. Farm to farm weather variations, which were not included in the analysis, probably caused most of the unexplained variation in yield. For both functions, the regression coefficient for plant density is signifi— cantly different from zero at the one per cent level. The lower re- liability of the other coefficients in the per acre function is not due to correlation between inputs, which is low. The high correlation between inputs in the total enterprise function probably indicates economic adjustment along the expansion line or line of least cost combinations in the factor-factor dimension. The most reasonable ex- planation is that yams have been cultivated in southern Nigeria for over 400 years. During this long period the art of growing yams has been developed to a high degree. This refinement of cultivation prac- tices was necessary because yams were the principal food stuff. The input mix of labor, soil fertility and seed has been adjusted through time until the maximum economic output per acre has been obtained. The marginal value product of labor is nearly equal to the cost of labor at harvest. The marginal physical product per plant of six, pounds in the per acre function is approximately the average weight of a yam produced in the area. This explanation is strengthened by the observation that size of heap and stands per heap are varied throughout the area according to soil type and fertility. The mar- ginal physical product of labor in the per acre function is nearly two yams per man day at the geometric mean. An interesting sidelight 123 TABLE 28.-Equation 6, regression analysis on a total enterprise basis of 38 native farmer yam enterprises, Abakaliki Division, 1963 Y = -3974.11 + 17.98 x1 + 8.86 x2 - 3663.30 x3 R2 = 0.96. 32 = 0.96 Interval of minus to plus one standard error of the estimate about the mean = 32,810 1; 10,250 lb. Where: Y a Total output in pounds weight X1 - Total labor in man days X2 - Total number of plants X3 a Size of yam enterprise in acres Supplemental statistics X1 X2 x3 Y Simple correlations: X1 1.000 .634 .677 .624 X2 1.000 .815 .973 x3 1.000 .729 Y 1.000 Regression coefficienta 17.98 8.86 -3663.29 Standard error 12.39b .47c 1027.87c Arithmetic Mean (A.M.)a 188 m.d. 4804 pl. 2.5 ac. 32,810 16. Geometric Mean (G.M.) 129 m.d. 2829 pl. 1.5 ac. 17,158 lb. MVP at A.M. a5 yam price per ton of: 5 9.3 156d Os9d 515.3 14.0 253d lsld 522.9 R2 deletes 0.96 0.57 0.95 8The regression coefficients are the marginal physical pro- ducts at the arithmetic means for the respective inputs. bSignificantly different from zero at 20 per cent probabi- lity level. CSignificantly different from zero at l per cent probabi— lity level. dSee footnote c, Table 21, p. 95. 124 is the fact that a common payment for a day's labor at harvest time is two yams. It appears that factors of production in traditional yam cultivation are very efficiently allocated. Costs and Returns for Farms with Both Paddy and Yam Enterprises Out of the 31 paddy and 38 yam production records used in the regression analysis, 22 farmers had usable records of both. The data on these 22 farms are shown in Table 30. It should be expected a priori that farmers who kept records of both enterprises would be more efficient than average farmers. The comparison of average per acre inputs and output of the 22 with the original 31 paddy and 38 yam farms (shown in Table 29) indicates that this is so. Labor inputs TABLE 29.-Inputs, output and income per acre for 31 native paddy farm records and 38 yam farm records, Abakaliki Division, 1963 Item I Unit : Paddy : Yams Labor Man days 128 108 Seed lb. 140 2620 tons -- 1.17 Cost Land 5 1.35 1.00 Labor 5 6.40 5.40 Seed 5 1.75 21.10 Total 5 9.50 27.50 Yield lb. 1532 12,500 tons .68 5.58 Income Cross 5 17.10 67.00 Net 5 7.60 39.50 Net income at zero labor cost 5 14.00 44.90 are 20 per cent lower and yields 10 per cent higher for the 22 than for the whole sample. This does nor effect relative profitability 125 TABLE 30.-Inputs, output, gross and net income for the 22 native rice- yam farms, Abakaliki Division, 1963 Item Unit Paddy Yams : Total Total Enterprise Acres acres 4.7 3.0 7.7 Labor man days 489 210 699 Seeda lbs. 437 8,096 -- tons -- 3.6 -- Cost b Land 5 6.35 3.00 9.35 Labocrlc L 24.45 10.50 34.95 Seed 5 5.40 64.80 70.20 Total 5 36.20 78.30 114.50 Yield tons 3.5 18.3 -- Income Grosse 6 87.90 219.60 307.50 Net 5 51.70 141.3 193.00 Per Acre Labor man days 104 70 Seed lbs. 93 2,700 tons -- 1.2 Cost Land 5 1.35 1.00 Labor 5 5.20 3.50 Seed 5 1.15 21.60 Total 5 7.70 26.10 Yield lbs. 1,675 13,660 tons .75 6.1 Income Gross 5 18.70 73.20 Net 5 11.00 47.10 Net income at zero labor cost 5 16.20 50.60 aYam seed computed at 1 lb. per sett, and increased by one- third to allow for weight loss between harvest and planting. bOpportunity cost of 51.35 per acre, from stranger farmer data. Yam land valued at 51 per acre. cOpportunity cost of operator and family labor at one shil- ling per man day. dPaddy seed at 3 pence per lb. (528 per ton). Yam seed at 518 per ton. ePaddy at 525 per ton, yams at 512 per ton. 126 however. Net income per acre, valuing operator and family labor at one shilling per man day, from yams is about four times that of paddy. When operator and family labor are considered to have zero opportunity cost, yams return three times as much net income per acre as paddy. The data thus show yams to be far more profitable on either a per acre basis or a per labor unit basis. If this is true, what would be the reason for the past expansion of paddy production in the area? Two factors must be examined: first, the reliability of the data, and second, the economics of rotations. Yield data are probably more reliable for paddy than for yams for the following reasons. Almost all paddy is sold and the com- mon unit of measure is the John Holt bag. Independent weighing tests at the Cooperative Rice Mill and at NORCAP have established the weight of a John Holt bag of paddy of about 15 per cent moisture content at 224 pounds which is two hundredweights or one-tenth of a long ton. Gross sales were checked against yield and verified for paddy farmers. Yam yields were computed from the yield of one-fortieth of an acre. Although an "average" one-fortieth of an acre was taken from each plot, there is still considerable room for error. Price data for paddy are also more reliable than for yams. Agricultural extension workers have been collecting prices on yams and paddy at Abakaliki for the past four years. Paddy prices were checked with both buyers and sellers. By contrast, yams were sold by the line which is not a standard unit of weight with which to check farmer prices. Also, as discussed in Chapter III, monthly and yearly price fluctuations are much greater for yams than for paddy. Comparisons of net incomes 127 under various combinations of changes in prices and yields are shown in Table 31. In summary, the paddy data are reliable but the yam TABLE 31.-Net income per acre for paddy and yams at various combina- tions of price and yield or both f Adjustment in 3 Net income per acre when oppor- Cro : Yield or price : tunity cost for labor per man p I or combination 2 day is: I of both I : : Zero 3 One shilling g _ _ Yams None 50.6 47.1 Paddy None 16.2 11.0 Yams 1/4 lower 32.3 28.8 Paddy 1/4 higher 20.9 15.7 Yams 1/3 lower 26.2 22.7 Paddy 1/3 higher 22.4 17.2 yield data may be suspect. Yam labor requirements may also be slightly understated. However, the following calculations are based on the ori- ginal data in Table 30. Crop rotations varied greatly among the ten villages in the sample. Unfortunately, the importance of rotation was not recognized at the start of the study and no data were acquired on this subject in the survey. An attempt was made during the follow-up survey to fill in the missing data. Therefore, the following discussion is based partly on general knowledge and assumptions rather than solely on concrete data. The optimum crop rotation appears to be a function of a group of factors that could be termed "economic pressure." Included in this group are population density, natural soil endowment, need 128 for income, and availability of markets for farm products in excess of local needs. Economic pressure and resulting rotations may vary greatly between neighboring groups. Economic pressure may even vary among individuals in the same group. In general, there are no areas left where extended bush fallow can be or is practiced. The fallow period has been shortened to no more than three years, with two and one year fallows in many areas and no fallow in some. The highest yam yield is obtained when yams follow ex- tended fallow. As the fallow period decreases, yam yields decrease. Replacement of fallow by paddy decreases yam yields very little. Paddy yields following yam are not much different than paddy follow— ing fallow while underbrushing labor requirements are less in the for- mer case. Paddy can follow paddy without yield reductions until after three to five years of continuous paddy. The yield of paddy follow~ ing yams may even be increased over paddy following paddy because of the aeration effect on the soil of building and pulling down yam heaps. All of these comments and the following assumptions depend upon speci- fic soil types. Decreases in yam yield may be less on the heavy clay soils in the saucer-shaped swamps than on lighter upland soils. But paddy yields will also be higher on the best soils. The data from the 22 yam-paddy farmers shown in Table 30 are for a six year rotation of FYPYPP.1 These data are the empiri- cal basis for the budgets shown in Table 32 and are shown as rotation 9. The following assumptions are made. The yam yields for rotation 1F stands for fallow, Y for yams, and P for paddy. 129 memosvov omam mg unwaos um: mo peanuimao .mamm now use :Hmuno ou madam umm>um£ Bonn vmuosvov ma mama mo unwwmz mam» .nH cq.N no henna .nH H co comma mum moHuono m maofiumuou one CH .owwMOum cu mommoa now .vwoovoum mmauoamo use was uawfioz .mmauoamo ooo.H ou Hmsvm .hmvnm ma m can .mamh mu w .3oHHmw ma .om manna Bonn pmumasoamo muomaoufisvmu Hosea vow maooaHm ~.mmm ooo.~H omm can mom m.oH omm own 0mm 0H mmwmwm .m m.don qu.OH mom can mam mJHH omm oo~ NHN 0H mmwm .m m.~om ow~.HH new emu cum o.mH omm own mmm OH mwh .n q.Hmm owqw an own man o.wH omm 08¢ 55H 0H mwmm .w w.ooq quc mmH can mmm o.- 0mm com «ma 0H Mum .m «.0Nq wwwo sea can con m.NN 0mm 0mm HmH OH MM .6 w.mom mwow mm omn «No «.3m 0mm omm HwH OH Nun .m q.qoq come mm 0mm one m.mq omm owH maH 0H whmm .N m.oqm comm 00 055 mwo m.om omm qu mNH oH wmmmm .H .Hmo :ofiHHHB m mHaoom .w.B m annum mfimowa .v.a a mopom mmmmo O mommu. O O O O O O O O O soon u soon" .Ha .Um “ " sham " spam ".Ha .am a u n n " cw .H8 a“ .H8 u A non ha ”Hosea“ you n you n Mom ho “HoemH u u u u .wm pom .Um you n “ lament " whee“ maooaw "mouow “ Immune " m%mv "oaooaa "mouse A cowu u moguono " maoocfiu .mom n max" mafiamm "amuoe " .nom " on: “haaawm "HmuoH "Inuom “.02 ssz . Essa. . . . U H manna mm: Henna H mammn om: mama H H moofimw>an axaamxme< “mafia mumsvm pom mowuono vow oaooaa haafidu .muamaov cowuwasaom "anew you cacocfi mawamw .vmufisvmu momma mam mowmouom magmasmou mucowumuou m>fiuwauoua It was also estimated that saucer-shaped swamp and small drainage way land in Abakaliki Division suitable for paddy production would allow for expansion to about 290,000 acres, using near optimum rotations. The estimate of pre- sent acreage in Eastern Nigeria was revised upward to 185,000 acres. The estimate of potential acreage in the Cross River Plains alone is 925,000 acres. The present cost per ton of producing paddy in Abakaliki Division compares favorably with the lowest cost producers in other parts of the world on which data are available. CHAPTER VI THE PADDY TRADING AND PROCESSING STAGE Only one of the native farmers interviewed in the produc— tion stage survey retained ownership of paddy through the processing stage. The general practice is to sell the paddy either soon af- ter threshing or within several months. Because all of the paddy traders retain ownership of the paddy throughout processing, a brief description of the practices followed is in order. Processing Practices Rice is stored exclusively in paddy form. In this form it is one of the few food crops that can be stored safely with simple practices in the trOpics. If the paddy is adequately dried immedi— ately after threshing and is kept in a dry, rodent-free place, it can safely be stored for up to one year without substantial loss in germination and for longer periods for consumption purposes. After the paddy has been milled or even after parboiling, it is subject to insect and weevil attack much the same as maize and beans. In unpar- boiled paddy form, however, the tightness and thickness of the outer glumes make it quite free from such damage. All of the paddy processed in Abakaliki—town is parboiled before hulling. The parboiling process described here is the general procedure followed. There are slight variations in method and timing between operators and probably between batches by the same operator. 144 145 Parboiling is carried out in old 44 gallon oil drums cut in half. Each half-drum is placed on several rocks leaving about one foot of space beneath. The drums are filled with paddy and then cold water. After one-half hour of soaking, a fire is started under the drum. As soon as the water begins to boil around the edge of the drum, the fire is removed and the drum is covered with old sacks. The process is usually started in the morning and the paddy is allowed to soak in the warm water all afternoon and night. If the weather is cool, a small fire may be started again several times during the night to raise the water temperature. In the morning the water is drained, and about two gallons of fresh water are placed in the paddy-filled drum. A fire is again started beneath the drum. The small amount of water in the bottom prevents scorching of the paddy and rapidly turns into steam. The paddy is then steamed for about one-half hour. Then the paddy is removed from the drum and spread out to dry on wo- ven mats. The depth of the paddy varies according to the intensity of sunlight. On cloudy days it is spread thinner than on bright sun- ny days to allow for slower drying. If drying is too rapid the grains crack badly. The parboiling process is desirable from several standpoints. The most important is from the nutritional standpoint. In parboiling, some of the vitamins are driven into the endo- Sperm-and by gelantinizing the starch of the outer layers seals the aleurone layer and the s;utte1um , so that they are not readily removed in milling.1 1D. H. Grist, Rice (3d ed; London: Longmans, Green and Co. Ltd., 1959), p. 336. 146 The second important result of parboiling is the increased percentage of whole grains after milling. Alternative wetting and drying of the grains in the field prior to harvesting results in internal cracking of the grains. As high as 46 per cent of cracked grains at harvest time has been observed in Sierra Leone.1 Further cracking may result when the paddy is sun dried after threshing. The parboiling process appears to seal up the cracks resulting in a higher percentage recov- ery of whole grains in milling.2 Milled rice from parboiled paddy can be stored more safely than rice from unparboiled paddy. There appears to be less loss of nutrients in cooking the milled product. A greater retention of the germ during milling (increasing the protein content of the finished product) has also been observed with parboiled paddy.3 There are at present several difficulties arising from par- boiling as practiced in Abakaliki. The hulled rice is frequently dis- colored. This results from both soaking in cold water and soaking 1R. Q. Craufurd, "Breakage of Rice during Milling," West African Rice Research StationPeriodn: Scientific Report, No. 11 (Rokupr: September, 1960). 2See J.A.F.M. Sluyters, "Milling Studies on Parboiled Rice in Nigeria," Tropical Agriculture, Vol. 40, No. 2 (April, 1963), pp. 153-58. Sluyters, "Some Information about Local Rice Mills and the Rice (Ogyza sativa L.) Produced in a Part of the Bida Division, North- ern Nigeria," Ngtherlands Journal of Agricultural Science, Vol. 10, No. 4 (November, 1962), pp. 297-303. W. O. Achukwu, "Speculative Considerations on Grain Hand- ling and Processing with Special Emphasis on Rice and Maize" and "Processing of Rice," (unpublished manuscripts, n.d.). 3Grist, p. 336. 147 and boiling in dirty water. There is also a great variation in the color and quality of the hulled rice. This is partially a result of several hundred different traders carrying out parboiling, each with a slightly different procedure and quality of water. It is also a result of the lack of uniform raw paddy size and quality. Drying the paddy after parboiling on concrete slabs or woven mats results in bits of soil, rock, and goat dung being mixed with the rice, as no cleaning or winnowing is done before or after hulling. The mills currently in use are mainly Lewis Grant Mills. They are commonly called Planters Mills and are horizontal hullers combining hulling and whitening in one operation. The hull and bran are taken off by a horizontal metal cylinder and an adjustment is possible for different grain types and sizes. In practice adjust- ments are rarely made between batches of paddy. The hulled rice then passes into a drum containing a rotating wooden cylinder with pieces of leather attached. This part of the machine is intended to clean and polish the rice. In practice the leather strips are not replaced and the action of the cylinder serves only to remove loose bits of husk and bran. The milled rice is piled on woven mats outside of the entrance to the mill building and sold to rice wholesalers. The unit of sale is the headpan, which contains approximately 56 pounds. The mixture of hulls and bran is carried out behind the building by women and children who toss it into the air or winnow it to recover the small and broken kernels. Huge mounds of this material are found behind each building. Fibre content is too high for the material to be fed to livestock. Much of it is burned and some is spread onto 148 nearby fields. Achukwu has found that this waste material could be utilized as fuel for parboiling.1 ‘Qgganiggtion of lggders Almost all of the paddy traders living in Abakaliki-town belong to one of three organizations, as was discussed in the pre- vious section on stranger farmers. The oldest organization is the Cooperative Rice Mill Company, Limited, which was established in 1954 with 128 members. In December, 1963, 147 members were regis- tered but only 101 were active (received a loan or hulled paddy or both in 1963). The inactive members had either moved back to their home cdforigin or stopped paddy trading to enter other businesses in Abakaliki-town. The Cooperative owns and operates ten engines and nine mills of which five or six sets are generally in working condi- tion. About 2,600 tons of paddy are hulled annually. Paddy is hulled for members at a fixed charge per ton. Paddy is parboiled in the members' compounds and transported to the mill by hand cart or by the tractor and trailer which the com- pany owns. Each member is allowed to store up to ten John Holt bags (a total of one ton) of parboiled paddy in the mill building. Most members keep at least one bag in storage in the building to reserve space. They store the remainder of their paddy (in unparboiled form) in their residence. Hulled rice is sold in small lots by the indivi- dual owner immediately after hulling, usually to big rice buyers. 1W. O. Achukwu, "Speculative Considerations on Grain Hand- ling and Processing with Special Emphasis on Rice and Maize," (un- published manuscript, n.d.), p. 9. 149 A portion of the annual profits or surplus from operating the Cooperative is distributed to members on the basis of the tonnage milled by each. Part is in the form of a cash dividend and part in the form of additional stock. The society obtains an annual loan from the Regional Cooperative and distributes this to members, also on the basis of tonnage milled. The loans are for paddy production and usually are received just before harvest time. Administration is by an annually elected president and board of 11 members. The president is restricted in actions he may take by the necessity of prior approval of the board for minor deci- sions and by approval of all members for major decisions. This tight system of checks on authority appears to be in response both to the suspicious nature of the strangers described by Ottenberg1 and the occurrence of a sizable embezzlement by an employee two years ago. The second organization, the City Rice Mill Company, Limited, was organized first as a Union in 1955 and then as a re- gistered company in 1957. In December, 1963, 47 members were regis— tered with 29 living in Abakaliki-town and actively engaged in paddy trading. The company owns two engines and hullers of which one set is usually in working order. Storage and parboiling are done both on the premises and at the members' compounds. Hulling is at a fixed charge per ton. Part of the hulled rice is sold by individual owners after hulling. The company also has contracts to provide a steady supply of rice to several educational institutions. The contracts 1Letter from Dr. Simon Ottenberg, Professor of Anthropology, University of Washington, Seattle, Washington, November 29, 1963. 150 are filled with rice from all the active members. The process for allocating proportions of contracts among the members was not ascer- tained. The company is administered by a managing director who is selected by the seven man board of directors from one of their num- ber. His powers are limited, and minor decisions are made by the board as a whole. The checks on authority again appear to be due to inherent suspicion and a violation of trust within the past two years by a director. This latter factor has resulted in the loss of all records of output for the past several years. On the basis of com- parison of activity observed during frequent visits to both the City Rice Mill and the Cooperative, and the number of hullers in moderately good working order, the City Rice Mill apparently hulls about one-fifth the tonnage of the Cooperative, or about 500 tons of paddy per annum. The third organization is the Abakaliki Rice Mill Owners Association which was organized in 1956. In December, 1963, the mem- bership list contained 65 names; apparently all of these were actively "and engaged in some phase of the rice industry. Four of the names were Company." The members own and operate 144 hulling machines with en- gines. There are various combinations of ownership. For example, as many as six members who are from the same sub-clan may own one or more machines in partnership, while in other cases, an individual may own one or several machines outright. The most common case is for one man to own one machine. No individual or group owns more than four hullers. The hullers are generally in badly worn condition and very little adjustment is made for varying grain sizes. It appears 151 that machines are not replaced when worn out and that the number Oper- ating is decreasing slowly. All of the members of this Association have their machines in the "Industrial Area." This area is about one mile from the main part of town but within the township boundary. Small buildings have been constructed along both sides of four short roads. The buildings were constructed by individuals on land owned by the Abakaliki Urban Council and an annual fee of about 52 for an average lot is charged for the use of the land. Each building provides operating space for one to four machines plus storage space for paddy to be milled. The buildings are often constructed by several individuals and subdivided according to the number of machines each individual owns. Milling charges are either by the John Holt bag of paddy or by the headpan of milled rice and fluctuate according to the supply of paddy to be milled. The main purpose of this Association appears to be control over hours of milling. The hours at present are from eight A.M. to twelve noon, every day except Sunday. The reason for this limitation of 24 running hours per week is that the capacity of the existing machines exceeds the supply of paddy to be milled by probably five times. When operations were unrestricted, competition among mill owners resulted in hulling charges being lowered to the point where probably only variable costs were met. The Association also has at- tempted to set a minimum hulling charge, but many of the operators will hull for a lower price during slack periods. This factor has caused some dissension in the Cooperative. During slack periods 152 some Cooperative members have their paddy hulled in the Industrial Area where hulling charges are lower than at the Cooperative. When activity is brisk and hulling charges by independent owners are higher than the Cooperative, they then hull at the Cooperative. Neither the Cooperative nor the City Rice Mill observe the 8 to 12 o'clock hours. They continue to bull in the afternoon even in slack periods. During periods of heavy milling, they operate from dawn to dusk. The leaders of both organizations stated that the only factor preventing around the clock operations during peak seasons is difficulty in providing security for the paddy and milled rice dur- ing the night. An interesting comparison can be made between investments in processing in the rice and oil palm industries in Eastern Nigeria. In rice, only 20 per cent of capacity is being used, and overinvest- ment in fixed assets has resulted in capital losses. But the capital losses have accrued entirely to private individuals. Yet the rice industry is a rapidly expanding industry. The private palm indus- try is a steady or declining industry (exports are declining but do- mestic use is either constant or slightly expanding). Initially pro- cessing investments were entirely private, in the form of screw presses and hand pounding. Then the government made a heavy investment in a new technique, the Pioneer oil mill. As a result, processing faci- lities are also operating at much less than one-half of capacity. The overinvestment is resulting in both private and public capital losses. The oil palm situation is further complicated by the fact that through research, a new technique, the Stork hand hydraulic press, has been developed which yields higher extraction rates than other 153 techniques being used. A sizable public investment was made to ac- quire the new equipment. However, the new technique has not been ac- cepted by private enterprise, and as a result, capital losses on the unused machines are accruing to the public sector. The oil palm situation has important implications for the rice industry. First, government investment in new techniques does not insure that overinvestment and capital losses will not occur. Second, it is not enough to concentrate only on engineering superior- ity of new factors, for if they are not profitable, private enterprise will not invest in them. Third, a country that is desperately short of capital in the first place cannot afford mistakes of overinvest- ment. Whether the public or the private sector can best stand capi- tal losses is not the main question, although in passing it would ap- pear that capital losses financed from private cash hoards are less damaging than public capital losses financed by taxation, especially of producers. Fourth, the previous point leads to the conclusion that opportunities to make small improvements by the addition of auxillary techniques should be exhausted before resorting to the write-off of sizable investments in obsolete equipment. Results of the Survey A random sample was drawn from the list of active members of each of the three organizations. If the person drawn farmed, a farm interview was completed. If he or she traded in paddy, a paddy trader interview was completed. If the person engaged in both, both schedules were taken. 154 The first section of Table 34 indicates the distribution TABLE 34.-Activities in 1963 of a sample of members of three organi- zations in Abakaliki-town, and characteristics of those who traded paddy Item f coopa f CRMb : MOAC : TOTAL Activities b Number in sample who: num er Farm only 7 l l 9 Trade only 15 9 9 33 Farm and trade 3 4 6 13 Total interviewed 25 14 16 55 Total active members 101 29 65 195 Per cent of sample who: per cent--— Farm only 28 7 6 16 Trade only 60 64 56 60 Farm and trade 12 29 38 24 Per cent of active members interviewed 25 48 . 25 28 Home of origin of traders number — Onitsha Province Awka Division 12 ll 13 36 Other Divisions 6 - - 6 Umuahia Province Arochukwu town 2 2 4 Total 18 13 15 46 Years in paddy trading 0 to 5 years 1 - - 1 6 to 10 years 6 2 7 15 11 to 15 years 8 6 5 19 Over 15 years 3 5 3 11 years - Average number of years 12 13 ll 12 a Cooperative b City Rice Mill CMill Owners Association of members between activities and the number interviewed for each or- ganization. The percentage distribution between farm only, trade only, and both, is valid for the 1963 crop year only. Several of the 155 largest farmers said that they never trade, and several of the largest traders said that they never farm. However, most of the members inter- viewed said that they shift from category to category depending upon their financial resources and availability of land. Negotiations for paddy land for the next season begin before the previous crop is har- vested, and by the end of December nearly all of the available paddy land has been placed under contract. If an individual can rent a swamp on which he thinks he can make a profit and if he has only enough money to farm, he does not trade in paddy that year. If on the other hand, he can borrow more money he then tends also to trade in paddy rather than apply the extra capital to the land area he has rented. If he is late in starting negotiations or lacks finance at the time he must pay the rental charge, he may not farm that year but just trade in paddy. Swamps within 15 miles of Abakaliki are often rented two to three years in advance. The cash rent is paid at the time the land is rented, not at the beginning or end of the cropping season. The second and third sections of Table 34 indicate some of the characteristics of the paddy traders. The dominance of people from Awka Division in paddy trading is clearly evident. In addition, people from the same part of the division tend to belong to the same organization. For example, ten of the 11 persons from Awka Division in the City Rice Mill are from the same village (Enugu-Ukwu). This closeness of social and cultural ties is often evident in joint ventures among several individuals in farming and trading. These joint undertakings are usually for one enterprise or venture only. The distrustfulness 156 described by Ottenberg seems to prevent lasting combinations.1 The paddy traders have had considerable experience in this occupation. Nearly one-fourth have been in the business over 15 years, or almost as long as the rice industry has been a commercial venture in Abaka- liki. It is also interesting to note that only one of the 46 inter- viewees entered the business in the past five years, which has been a period of generally high rice prices. This period was also commonly thought to have been one of high profits in paddy trading. Table 35 indicates the sources of paddy purchased by the traders. The sources are progressively inclusive, i.e., a person buying rice in Benin also buys in the four other areas. "Abaka- liki-town only" refers to Abakpa market, located on the western edge of the town (near the City Rice Mill). This is a small market, and although a few native farmers bring paddy in by lorry, the bulk of the paddy sold there is brought in by head load or hand cart from the surrounding area. "Abakaliki Province only" includes not only Abakpa market but also the many small local village markets and farmers' compounds scattered throughout the province. Ogoja Province sources are primarily Ogoja and Obudu towns. One-half of the trad— ers interviewed went into the Northern Region for paddy. Most of their sources were south of the Benue River, although one trader ranges as far north as Sokoto (900 miles). He usually purchases pad- dy for several associates on each trip. The prevalence of the prac- tice of buying paddy at Benin (284 miles) is probably understated. The two traders who went there last year purchased paddy for tempor- arily formed (for each trip) groups of traders. The trips to Benin M 157 TABLE 35.-Buying activities of Abakaliki paddy traders, 1963 Item j coopal : CRMb j MOAC TOTAL Place of purchase -------- number of traders Abakaliki-town only 4 1 - 5 Abakaliki Prov. only 3 4 2 9 Also Ogoja Province - 3 4 7 Also Northern Region 10 5 8 23 Also Benin (Mid-West) l - 1 2 Purchase directly from farmers In their compounds 12 12 9 33 Who bring paddy to Abakaliki-town 15 ll 11 37 Size of purchase per buying trip Less than one ton 2 - 3 5 One to three tons 11 10 9 30 Four to six tons 3 3 l 7 Seven tons or more 2 2 4 Loans to farmers from whom paddy is purchased Does not loan 15 8 12 36 Loans at no interest: Before planting l 2 3 6 At harvest 1 l - 2 Loans on profit sharing basis 1 2 - 2 a Cooperative b City Rice Mill cMill Owners Association are made in July and August when the upland paddy in that area is be- ing harvested. The next section of Table 35 indicates the prevalence of the practices of buying paddy at farmers' compounds and from farmers who bring paddy into Abakaliki-town. Since over three-fourths of the traders engaged in the latter practice, there seems to be no factual basis for the farmers' suspicions of collusion on the part of the trader. This observation of lack of collusion is further 158 reinforced by Ottenberg's findings1 and by personal observations in a number of local markets where bidding for paddy was spirited. The third section in Table 35 indicates the distribution of average amounts purchased per buying trip. Most of the lorries hired by the traders have a capacity of 75 John Holt bags (7.5 tons). The four traders who purchased over seven tons per trip bought either 75 bags or 150 bags. The five traders purchasing less than one ton per trip bought mostly in Abakpa market or nearby village markets. The fourth section of Table 35 illustrates the general lack of involvement by traders in loaning money to farmers. Less than one- fourth loaned any money at all, and then only to farmers who were sub- sequently committed to selling their paddy to the grantor of the loan. The two traders who said that they loan at harvest time may in fact only be giving down payments on paddy already purchased. The two profit sharing arrangements result in the amount of the loan being taken first from the proceeds of sale of the paddy (to the trader making the loan), and the remainder being divided equally between borrower and lender. There were no instances of loans to farmers from whom paddy is not purchased. There might be a tendency for traders to have a clientele of farmers from whom they purchase paddy regularly every year, especially in cases where purchases are made at the compound, but this could not be documented. The cost of transporting paddy per ton-mile is given in Table 36. Costs steadily decline as distance increases, except for the Benin and Sokoto trips. The higher rate for the Benin trip re- 1Ibid. 159 TABLE 36.-Cost of transporting paddy per ton-mile by lorry to Abaka- liki-town, 1963 Distance in miles : Pence per ton-mile : Number of “ I ' Observations. 5-12 15 2 18-45 8 17 72-120 5 29 150-200 4 6 284 5 3 500 3 1 900 5.3 1 flects both ferry charges across the Niger and a strong transport union that requires transferring loads from one lorry to another at Onitsha (this aspect will be discussed more fully in the section on the stage three survey). The Sokoto trip probably also involves ferry charges and possibly similar union problems. None of the traders owned lorries. Only three or four of the 46 interviewed owned a car, Buying trips within 30 miles of Aba- kaliki-town are made on bicycles or by lorry. The traders take empty bags with them. They may charter a lorry if they have purchased a full load from several farmers directly in their compounds. The more general practice, however, is for several lorries to appear at each of the village markets on market day. Most of the paddy sold in these markets is in 50 to 60 pound baskets. The trader buys the paddy, places it in his bags, and arranges for the lorries to de- liver it to his compound in Abakaliki-town. Thus transport charges vary from market day to market day at the same market, depending up- on the number of lorries that arrive. Most of the markets are held every four days but some of the small ones are eight-day markets. 160 Cost of transporting paddy by hand pushcart within Abakaliki-town is much higher and averages about seven shillings per ton~mile. Of the 46 traders interviewed, 19 regularly engage in stor- age activities (Table 37). This activity involves speculation as well as creation of time utility. Paddy is purchased in period of low prices, usually after harvest in November and December, and it is stored for an average of six months. The period of peak prices for milled rice is usually from June until November with a slight decline when upland paddy from the Western and Mid-Western regions enters the market in August. The periods of low and high prices vary from.yesr to year. In 1963, prices dropped from 25 to 50 per cent in July, probably because of an underestimation of paddy sup- plies by speculators. This opinion is based on some evidence of an increase in the number of farmers who store paddy. The average peak tonnage stored per trader was 13.4 tons, representing from 5300 to 5400 tied up in stored paddy and indicating that only traders with adequate financing engage in this practice. TABLE 37.-Number who regularly store paddy, length of time stored, and highest tonnage stored, Abakaliki paddy traders, 1963 Item f 0002‘ f 01114" f MOAc 3 TOTAL Number who stored paddy 5 8 6 19 Average length of months 6 5 6 6 Highest tonnage stored 11.6 13.2 15.2 13.4 a Cooperative b City Rice Mill cMill Owners Association 161 The source of finance (question 22 of the questionnaire) could not be ascertained due to reluctance of the traders to discuss this question. There was some indication that they do not use com- mercial credit(except for the Cooperative) and that they do rely heavily on friends and relatives. As mentioned previously, the Coop- erative annually obtains a large loan from the Regional Cooperative Society and parcels it out to members on the basis of tonnage milled annually. Though these loans are for production, they are made late enough in the season so that harvest and rental of land for the next season are the main uses. The 101 active members received an average loan of 570, compared to an average of 565 for the 18 in the sample. The same 101 members milled an average of 23.6 tons of paddy in 1963, compared to 23.1 tons for the sample. Both statistics illustrate the value of the representative sample. No instances were found of financial arrangements between paddy traders and the big rice buyers who purchase the milled rice from them. The estimate of parboiling costs is 35 shillings (51.75) per ton of paddy, which is equal to 52.9 per ton of milled rice. This includes cost of wood and water only. Practices varied from the use of all hired labor to all family labor, so labor costs were not in- cluded. When hired labor is used, it is generally unskilled and costs one pound or less per month, plus food, shelter, and clothing. The last item on the questionnaire was open-ended, and asked the paddy traders what they felt were their principal problems, in or- der of importance. Every respondent stated that lack of capital was his most pressing problem. Most felt that "Government" should loan 162 them money (or more money in the case of Cooperative members) so that they could expand their trading activities. The second most frequently mentioned problem (20 responses) was parboiling. The major complaints were that the cost is too high, that too much labor is required, and that the labor involved is too strenuous. Several were hospitalized recently and advised to stop doing the work of parboiling. Difficul- ties in milling and selling milled rice were mentioned five and three times respectively. Summary The paddy trading stage is composed of many individuals each operating on a small scale. None of the participants are natives of Abakaliki. Persons from the same home of origin tend to form loose organizations. Due to the highly individualistic nature of the mem- bers, the organizations are weak. The paddy traders perform the marketing functions of moving of paddy off the farms, storing, and processing. About one-fourth of the individuals (strangers) engaged in the trade had vertically inte- grated the production and trading stages for the 1963 season. Indi- viduals shift, however, between farming only, farming and trading, and trading only from year to year, depending upon the amount of capital available. Transportion costs are high for short distances. The traders based at Abakaliki bring paddy to Abakaliki for process- ing not only from all over the Eastern Region but also the Northern Region as far north as the Benue River. Some paddy comes from as far north as Sokota, and part of the Benin area upland paddy crop also moves to Abakaliki. Storage is done at low cost, in small 163 volumes per trader, and in unspecialized structures. There is very little financial involvement with producers, such as production loans, and no purchase of standing crops. Although there are many small traders, there appears to be some barrier to entry into the trade. One out of 46 interviewed entered the industry in the past five years. The barrier might be the amount of capital required, difficulty in gaining confidence of local people, or the clannishness of the present traders. The processing function consists of two steps, parboiling and milling. Parboiling is done by the traders on a small scale. Techniques have not changed since the practice was introduced in the mid-1940's and are partially responsible for a low quality of milled rice. The most striking features of the milling process are the great excess of capacity and the low quality of the product. The present mills are operating at only about 20 per cent of capacity. This great overinvestment has been made entirely by the private sector. The government introduced mechanical milling in 1947 and within two years had transferred not only milling but also supplying of new mills to the private sector. Since 1949 there has been no government invest- ment in either directly productive facilities or in research in this stage of the industry. Although this private overinvestment has re- sulted in fixed assets on which capital losses have occurred, it has taken place in an expanding industry. Furthermore, the capital has come from private sources and cash hoards, not commercial sources or govermnent loans. By contrast, the Northern Region, an area that pro— duces four times as much paddy, has only two-thirds as many mills as 164 the East, and all the Northern mills were financed by Government loans to private individuals. There is currently a great amount of tension among indivi- duals engaged in processing. The introduction of a new type of mill in late 1963 was met with disturbances. It was necessary for civil authority to maintain order. Another disturbance was instigated by employees of processors over rights to load lorries. The brunt of the mid-1963 price break, which brought the rice industry into adjustment with the world rice economy, appears to have been borne by the paddy traders. There is normally a price rise until the time that the Benin upland new crop paddy enters the market. In 1963 many traders had considerable stocks in storage in July when the price fell. An increasing amount of native producer storage also contributed to a general underestimation of the stock of paddy. A third factor, import competition, will be discussed in Chapter VIII. As a result of this adjustment profit margins for paddy traders were very low at the time of the survey. Some traders appeared to be leav- ing the industry. Finance is the greatest "felt" difficulty and par- boiling the greatest real problem for the paddy traders. EXcess process- ing capacity and poor quality product are the greatest real problems for this stage as a whole. The paddy trading-processing stage thus possesses a consider- able capacity to expand volume-wise to meet predicted demand increases. The processing capacity for a four-fold expansion in volume already exists. There is much evidence that further investments will be forthcoming if demand for processing services expands to make the 165 furnishing of such services profitable. The main difficulty involves quality. If the expansion in volume is not accompanied by improvements in quality, the product will not meet the quality demands of consumers. Serious attention needs to be given to the quality problem. CHAPTER VII THE DISTRIBUTION STAGE Milled rice is invariably sold by paddy traders on the day it is hulled. The freshly milled rice is placed on mats in front of the huller buildings or, in case of rainy weather, inside the build- ings. No cases were found of paddy traders either transporting the rice to consumption centers or storing milled rice. The movement of rice is carried out by individuals known locally as "big rice buyers." Selection ofgInterviewees No complete list of buyers existed from which to draw a sample to be interviewed. An organizatiOn of buyers, the Rice Traders Company Limited, is located in the Industrial Area. This organization owns and operates several hulling machines, but its chief function is that of a transportation booking agency. There are currently 491 mem- bers, but the managing director reports that only about 100 actively use the services of the company. There is a charge of two shillings per ton for booking, and although the by-laws of the organization re- quire that all rice purchased by members be booked, many members do so only when they cannot get lower freight rates elsewhere. From March 1, 1962, to March 1, 1963, 22,818 tons of rice were handled by the company, with 90 per cent of this amount being shipped to Lagos. Due to both the bias in the membership toward Lagos-bound buyers and the "itinerant" characteristic of rice buyers in general, 166 167 the membership list of this organization was not used for sampling. The procedure followed was to attempt to interview every buyer who entered the Industrial Area during a two-week period which was ex- pected to be the busiest two weeks of the year. The attempt was not very successful. One-third of the buyers refused to be interviewed. There are several plausible explanations for their reluctance. First, the intensified tax drive during December undoubtedly affected sub- ject response in all surveys. Second, a frequent excuse was, "I'm too busy buying now; talk to me after I've finished buying." After the rice was purchased and loaded, however, the buyers wanted to leave immediately for their destinations in order to be there when the rice arrived. Third, all transactions are in cash and since each buyer was carrying from £50 to £250 on his person, he might be ex- pected to be quite reluctant to talk to strangers. Fourth, since many of the buyers claimed that they lost heavily in the mid-1963 price drop, they may have been suspicious of anyone inquiring about their business. Strangely enough, many of those who did consent to be interviewed were very cooperative. They volunteered information freely and some introduced other buyers or even brought other buyers to the interviewer. Due to the difficulties described above, the data collected must be interpreted with caution. Although the sample is question- able, it does provide:(l) the only known empirical data on distribu- tion practices, (2) estimates of costs at various steps in the distri- bution process, and (3) some insight into how this stage is performing in relation to other stages in the industry. The major weakness is 168 that the comparability of characteristics of the one-third or about 43 non-respondents with the 86 respondents is not known. The impli- cations of this defect in sampling can be illustrated by examining several estimates of volume of rice milled in Abakaliki. Estimates of Volume The data in Table 38 and the calculations in footnote f indicate the estimate of volumezfnmnthis survey. Several other esti- mates of volume are available. The Rice Traders Company handled 22,818 tons of milled rice from March 1, 1962, to March 1, 1963. Tonnage in December, 1962, was 2,435.1 Zwankhuizen reports 28,400 tons for the 1959-60 season.2 Achukwu has estimated the 1962-63 sea- son output as 47,000 tons of milled rice.3 Zwankhuizen's data possibly came from previous reports of the Rice Traders Company plus total ton- nages milled at the Cooperative and the City Rice Mill. First, what proportion of the rice milled in the Industrial Area is recorded by the Rice Traders Company? Only 26 of the 86 buyers interviewed were members of the Company. Thus, even if all non-participants were mem- bers, this would still leave 60 out of about 130 as non-members. If the volume of all non-company members is the same as members, then company volume would be slightly over half of total volume, and 1Report to Ministry of Commerce (Enugu, Nigeria, May 31, 1963). 2M. T. Zwankhuizen, Improvement in Processing and Utiliza- of Copra, Cassava (QaIL), Rice, and Cashew Nuts Suitable for Adoption in Rural Industries, F.A.O. Expanded Program of Technical AssistanCe Report No. 1529 (Rome: 1962), pp. 34-44. 3Personal interview with W.O. Achukwu, Agricultural Engineer, Abakaliki. 169 TABLE 38.-Number of respondents, buying trips, average and total vol- umes, membership affiliations, and distances, by destination, 86 rice buyers, Abakaliki Industrial Area, December, 1963 Ave. : Ave. : Total : : : tons : trips : tons : Members : Road Destination : No. : per : per : for a : : : trip : month : Dec. : R°T°C' : Mileage Lagos 20 6.1 2.2 281.8 11 529 Onitsha 16 3.0 3.2 153.8 6 119 Aba 14 3.2 2.8 125.4 2 185 Port Harcourt 7 3.3 2.3 53.1 1 243 Enugu 6 1.3 2.7 21.1 2 52 Umuahia 6 3.1 2.5 46.5 1 147 Owerri 5 2.6 1.3 16.9 - x 184 Mbaiseb 3 2.5 1.0 7.5 - 165 Calabar 2 2.4 2.0 9.6 2 h Ibadan 2 4.4 2.0 17.6 1 440 UyoC 1' 2.2 c 0.4 - 198 Yahed 1 1.0 1.0 1.0 - 7o Obubra l 0.25 1.0 0.25 - 30 Mamfee 1 0.8 1.0 0.8 - 131 Lagosf l - - 112.4 - 529 Totals 86 848.2 26 aRice Traders Company, Limited, Abakaliki. bMidway between Umuahia and Owerri. CTwo times per year but buys at Aba two times per month. d Near Ogoja. eSouthern Cameroons. fOne firm, a partnership of three brothers, is based in Abakaliki and ships rice exclusively to Lagos. The firm owns and operates a mill, buys rice after milling, transports it as far as Onitsha in its own lorry, and uses hired transport from Onitsha to Lagos. Although this firm handled 13 per cent of the volume in the sample, it probably handles 3 to 4 per cent to total actual volume. It is still the largest firm in this stage. gAssuming December volume is one-twelfth of annual volume, then sample annual volume is 848.2 x 12 or 10,178 tons. If the one- third non-respondents averaged the same volume as the respondents, then estimated total volume is 10,178 X 1.5 or 15,268 tons. hNo road. 170 Achukwu's figure of 47,000 tons may be a close estimate. However, because of the bias in membership toward Lagos-bound buyers, and be- cause Lagos buyers may average higher volumes per trip, the Company's share of total volume may be more thanihalf of the total. Assuming that the Company handled two-thirds of the volume, total output would have been about 34,000 tons. Therefore, total annual volume probably was between 34,000 and 47,000 tons. The 848-ton volume of the 86 interviewees, multiplied by 12 months and by 1.5 (assuming equal volume per buyer for non-participants as for the participants) equals only 15,270 tons, or from one-third to one-half of the estimate of annual volume. Multiplying 848 tons by 1.5 equals 1,272 tons for December only, whereas estimated December volume was between 3,650 and 4,900 tons. Results of the Survey Many of the buyers who make two or more trips per month appeared a second time during the interviewing period. They were not interviewed again. However, the interviewing procedure did not allow an estimation of the number of buyers who make less than two trips per month. The remainder of the discussion of the results of the sur- vey is in terms of the sample only and not the universe of all rice buyers. But certain characteristics exhibited such a small variance within the sample that they may be interpreted as possible indications of characteristics of the universe. One such characteristic, shown in Table 38, is that Lagos buyers handle bigger volumes per buyer than buyers from other areas. Another is that many buyers are not 171 members of the Rice Traders Company. The stage four survey revealed that a buyers' organization exists in Ibadan with about 30 members. One member makes the trip to Abakaliki and buys for all of the other members. However, the two buyers from Ibadan who were interviewed were not members. No other buying organization was found. The data in Table 39 indicates that both wholesalers and retailers purchase rice at the mill. Nearly one-fourth of the 86 respondents sold rice by the cigarette cup only. One-third sold at both wholesale and retail levels. Both wholesalers and retailers tend to specialize in rice. If they handle another food product, it is usually beans. Most of the buyers buy in Abakaliki-town only (Table 40). Many of those that also buy elsewhere do so in the Northern Region. The ten who also purchase rice in their home market reflect the tendency for Eastern retailers to obtain most of their rice from wholesalers in their home market. They only travel to Aba- kaliki several times per year. About one—half of the wholesalers have been in business less than five years, and very few over ten years. The most reliable data obtained were on costs of rice at x the mill, transportation, and selling price. Within categories by destination, costs at mill had only a slight variation, as shown in Table 41. Variation in cost at mill between destinations might re- flect different consumer tastes for quality. Cost of transport, Table 42, is added to cost at mill to obtain cost delivered in Table 41. Selling price, margin, and size of sale at destination are not reliable for Enugu and Ibadan due to low number of observations. 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