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The study analyzed the performance of watermelon marketing in Enugu state, Nigeria. Watermelon has long been regarded as a minor crop in Nigeria and thus, has attracted little marketing research attention, in comparison to other major food and cash crops. The specific objectives were to: describe the socio-economic characteristics of watermelon marketers (wholesalers and retailers); describe the marketing channels of watermelon; examine the structure and conducts of watermelon market; determine the costs and returns of watermelon marketing; determine the marketing margin and market efficiency of market participants; determine the factors influencing the net marketing returns of the marketers and identify constraints to watermelon marketing. Multistage sampling technique was employed in selecting eight watermelon markets based on the volume of watermelon traded in the markets. Primary data were collected from 160 respondents comprising 96 retailers and 64 wholesalers with the aid of well structured questionnaire. Data collected were analyzed using descriptive statistics, Gini coefficient, net marketing income, percentage marketing margin, marketing efficiency index and multiple regression model. Results showed that watermelon marketing was dominated by the married (76.25%), literates (97.5%) and females (78.13%) with the mean age and marketing experience of 47 and seven years respectively. Four marketing channels of watermelon were identified. Though watermelon market was characterized by many buyers and sellers with little or no restrictions to entry and exit, the high values of Gini coefficient for wholesalers (0.658) and retailers (0.729) indicated high concentration of watermelon in the hands of few marketers and high income inequalities in the distribution of sales income amongst them. Majority of wholesalers (98.4%) obtained their products in heaps of hundred directly from the producers, while majority of the retailers (92.2%) bought their products per fruit or ball of watermelon directly from the wholesalers. Fixing of prices after deducting the amount spent on purchases and other costs (98.13%) and settling for a price after haggling with buyers (80.63%) were more preferred pricing methods used by the watermelon marketers. The result of net marketing income per month in kilogram showed that the enterprise was viable; watermelon wholesalers on the average received ₦1,668,292.13 while the retailers received ₦28,701.87. The marketing margins of the marketers were positive, the mean percentage marketing margins for wholesalers and retailers were 45.49% and 31.5% respectively. Though watermelon marketing was profitable, further analysis showed that it was highly inefficient. The marketing efficiency of wholesaler and retailers were 44.83% and 27.97% respectively. The determinants of wholesaler’s net marketing income were product price (0.581) and transportation cost (-2.609), while product price (1.501), educational level (-0.584), storage cost (-0.131), packaging cost (-0.077) and market information (0.057) significantly influenced retailer’s net marketing income. High perishability of watermelon (spoilage), cost of watermelon, high transportation cost, lack of credit facilities, price fluctuation and lack of preservation facilities were identified as the major constraints militating against the efficient marketing of watermelon. It is recommended that government should provide loans and modern storage facilities to enhance the capital base of the marketers and also to reduce losses due to product deterioration in storage.
1.1 Background Information
Fruits and vegetables are of great nutritional value (Idah, Ajisegiri & Yisa, 2007). They are important sources of vitamins and minerals, thus, essential components of human diet. Vegetable production forms a substantial percentage (about 25%) of the major food crops cultivated in the tropics and so it is the source of livelihood for a considerable section of the population (Kra & Bani, 1998).
Watermelon (Citrullus lanatus) is one of the world’s most important vegetables as the crop is grown both for its fruit and the vegetative parts which are highly nutritious (Schippers, 2000). It is a member of the cucurbit family commonly referred to as Cucurbitaceae (Huh, Solmaz & Sari, 2008), a warm-season crop related to cantaloupe, squash, cucumber and pumpkin (Georage, Darbie & Kelley, 2000). It is an important horticultural crop, mostly known for its sweet and juicy fruit, grown commercially in areas with long frost-free warm climates all over the world (Robinson & Decker-Walters, 1997; Jeffrey, 2001; Prohens & Nuez, 2008). Baba, Yelwa and Sanchi (2014) as well as Adeoye, Usman and Badmus (2011) reported that watermelon global consumption is greater than that of any other cucurbit. It accounts for 6.8% of the world area devoted to vegetable production (Guner & Wehner, 2004).
According to Onyemauwa (2010) watermelon is consumed throughout the world and it is mainly cultivated in the tropical countries. China is the leading country in the production of watermelon followed by Turkey, Brazil, United States, Egypt and Russia Federation (Huh, Solmaz & Sari, 2008; FAOSTAT, 2008). In Africa, watermelon accounted for 5.4% of the harvested area devoted to vegetable production in 2008, and this contributed to the world watermelon production with 4.6% of 99,194,223 metric tons (FAOSTAT, 2008). In Nigeria,
the crop has a wide distribution as a garden crop, while as a commercial vegetable; its cultivation is confined to the drier savanna region of Nigeria (Daudu, Ajayi & Ndor, 2008). Nigeria produced more watermelons in 2011 (139,223 tons) than Kenya which is the leading fresh produce African exporter, with 66,196 tons and South Africa that produced 77,993, tons (Alfa-nla, 2012). The largest production of the crop comes from the Northern part of Nigeria, where the suitable agro ecology is found. However, a reasonable quantity of the crop could still be grown in other agro ecologies with intensive management and is still economically feasible (Bosede, Olubunmi & Balogun, 2012).
Watermelon reaches consumers through the marketing system. Marketing is concerned with all stages of operation, which facilitate the movement of the commodities from the farms to the consumers. Marketing has economic value because it gives form, time and place utility to products and services (Asogwa & Okwoche, 2012). Therefore, increase in marketing activity of watermelon would enhance the provision of more and better produce at low price to increased number of people which would enable marketers to generate more income and increase welfare.
The marketing channel of watermelon is an important part of its cost, and its location to the market may shorten the path of the distribution from producers to consumers and makes the marketing process simple and efficient (Egbuna, 2009). Efficiency in the marketing of watermelon is borne on the platter of an efficient market information provision (Oguntola, 2006). In fruit marketing, farmers and marketers determine the flow of information from the farm to the market place and this consequently influences the market performance.
Market performance is an appraisal of the process of marketing and how successful its aims and objectives are accomplished (Eronmwon, Alufohai & Ada-Okungbowa, 2014). Kohls and Uhl (1985) defined market performance in terms of how effectively and efficiently
the marketing systems perform what the society and the market participants expect of it. It is often a complex notion mainly because of the multiple and often conflicting goals for the marketing system. The market performance is determined by the structure (numbers and sizes of firms, degree of product differentiation, and conditions of entry) and conducts (firms’ price, product, and promotional strategies) (Kohls & Uhl, 1998). Profit and marketing efficiency are most frequently used measure of market performance (Olukosi, Isitor & Ode, 2005). Marketing efficiency shows the degree of market performance. Adegeye and Dittoh (1985) defined agricultural marketing efficiency as the movement of crops and livestock from the producers to consumers at the lowest possible cost which is consistent with the provision of the services consumers’ desire. Improved efficiency is a common goal of farmers, food marketing firms, consumers, and society. Efficient marketing plays a crucial role in an economy. This role becomes more evident in areas where there are high rate of urbanization (Olukosi et al., 2005).
Ajewole (2015) reported that watermelon is highly relished as a fresh fruit in different parts of the world because of its thirst-quenching attribute in addition to many other identified nutritional values and advantages. The consumption of the commodity in the recent times has witnessed remarkable development as it cuts across all socio economic classes. In the study by Onyemauwa (2010), watermelon was found to be good for all human consumption and livestock needs as it contains most of the basic daily nutritional requirements of the body and other essential nutrients that prevent human health problems like cancer, stroke, high blood pressure, heart attack and other cardiovascular disease. Watermelon could be eaten raw when it is fresh after being washed and sliced into bits. Its nutritional values include low calories, lycopene which is an antioxidant that prevents cancer and other diseases, vitamin A, vitamin C, protein, carbohydrate, fibre, potassium, calcium, iron, fats and up to 92% of water (Onyemauwa, 2010). These are all necessary for good health and development of human and
livestock needs. Hence, it is referred to as “the chief of the world’s luxuries and king over all fruits of the earth” (United States Department of Agriculture, 1998).
1.2 Statement of the Problem
Fruits and vegetables such as watermelon are important sources of vitamins and minerals and are thus essential components of the human diet (Egharevba, 1995). The high demand for this vegetable fruit is not met in the Southern part of Nigeria due to unfavourable climatic condition (Okonmah, Agbogidi & Nwagu, 2011). Consequent upon this, there has been increased trade and commerce activities surrounding these commodities. Efficient marketing of watermelon is important to ensure its all-year round availability due to its high demand by consumers (Ekerete & Asa, 2014).
The potentials of watermelon as a cash generating crop is significant for farmers especially those residing near the urban areas. Recent reports indicate that exotic vegetables production generally generate higher profit, provide more employment and income to the farmers than those of indigenous vegetables (Isibor & Ugwumba, 2014). According to Oguntola (2006), watermelon is the most preferred among five other exotic vegetables such as cantaloupe, squash, cucumber and pumpkin examined in Ibadan Metropolis of Oyo State, Nigeria. Dovie, Witkowski and Shackleton (2003) noted that trading and consumption of watermelon is vital to livelihood and entrenchment of food security in some parts of South Africa. Trevor (2008), in his study in Northern Ghana also noted that watermelon serves as an important source of revenue to farmers especially in times of unfavourable weather conditions since it is able to withstand harsh weather conditions as compared to other crops. In Nigeria, Isibor and Ugwumba (2014) reported that watermelon marketing is a source of employment and income generation for many people especially women and adolescents.
In spite of its importance globally, watermelon has its peculiarities and challenges in its marketing. In India, marketing of watermelon is confronted with issues like problem of
transportation, the use of numerous agents and mobile traders and lack of an organized marketing system among others (Varmudy, 2012). Food and Agriculture Organization of United Nations (FAO) (2011) and Tuffour and Dokurugu (2015) asserted that like other agricultural goods in many African countries, fruits, watermelon inclusive, usually rot in farms due to either poor or unavailable transport facilities. Marketing system in Nigeria is faced with perennial problems of inefficiency and ineffectiveness due to inadequate market infrastructural facilities, transportation and pricing system (Onyemauwa, 2010; Adakaren, Ahmadu & Chidebelu, 2012). Adugna (2009) noted that as high as 30% losses in vegetables are recorded during transportation from point of production to point of consumption.
The consumption of exotic vegetable including watermelon has been on the increase but the cost of executing various marketing functions have made the price to increase more than necessary and has made some consumers to relent in its consumption (Nya, Okorie & Eka, 2010). This is partly because most of the watermelons marketed in Southern parts of Nigeria are usually produced in the rural areas of Northern Nigeria. The quantity of watermelon available for consumption and the price paid by the consumer depends on how efficient the marketing system of watermelon functions. Watermelon marketers experience lots of problem in trying to meet demand for the vegetable due to fluctuation in supply. It is a perishable agricultural produce and cannot be stored over a long period of time.
Watermelon has long been regarded as a minor crop in Nigeria and thus, has attracted little marketing research attention, in comparison to other major food crops and cash crops. Several studies have been conducted with respect to watermelon production in Africa, of which some focused on the economic analysis of its production based system (Adeoye et al., 2011), income and factor analysis of watermelon (Oladele, 2015), traditional knowledge with respect to the cultivation and uses of watermelon in Mozambique (Munisse, Andersen, Jensen & Christiansen, 2011). Though Onyemauwa (2010), Kainga (2013), Isibor &
Ugwumba (2014) and Olumide (2015) concentrated on the marketing margins and marketing efficiencies of watermelon in their studies in urban areas of South-West and South-South of Nigeria, available literatures showed that limited researches were conducted along the costs, market margin, marketing efficiency, market structure and conducts of watermelon in Enugu State.
Economic Research Service (1994) reported that in terms of price, there is considerable variability in watermelon prices within the year due mostly to seasonal changes in the volume of production. The distribution and availability of watermelon in Enugu State tends to be inadequate and inefficient. The product is rarely produced in the study area and its external influx could pose high cost of marketing on the product and implicitly the price of watermelon very exorbitant. In view of the rising demand for watermelon in the State in the face of inefficient marketing (FAO, 1997), therefore, it is pertinent and relevant to analyze the performance of the watermelon marketing in Enugu State, Nigeria. Consequently, the following research questions have remained unanswered:
a) What are the socio-economic characteristics of watermelon marketers?
b) What are the marketing channels of watermelon?
c) What are the market structure and conducts of watermelon market in the study area?
d) What are the net marketing returns of market participants?
e) How efficient is watermelon market in the study area?
f) What are the variables that determine the net returns in the market? and
g) What are the constraints associated with watermelon marketing in the study area?
1.3 Objectives of the Study
The broad objective of this study was to analyze the performance of watermelon marketing in Enugu State, Nigeria.
The study addressed the following specific objectives:
i. describe the socio-economic characteristics of watermelon marketers (wholesalers and retailers);
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