Resource use efficiency of palm oil processing in Ovia North East and Ikpoba Okha Local Government Areas, Edo State, Nigeria

The study investigated the resource use efficiency of palm oil processing in Ovia North East and Ikpoba-Okha Local Government Areas of Edo State, Nigeria. Structured questionnaires were used to collect information required for the study from sixty (60) processors through systematic sampling procedure. The finding established that processors were relatively young (mean age of 39 years) and low-income earners with a mean income of N435,416.67($1,244.05) per annum. Return to scale was – 48.13 and processors operated at stage III (irrational stage) of production function curve. The mean technical efficiency was 0.726 indicating that processors were 72.60% efficient in the use of scare resources. The inefficiency model showed that household size (3.35) was positively related to technical inefficiency. Age (12.96 years) and processing experience of thirteen (13) years were also established to be positively related to technical inefficiency. The result also showed that years of schooling was a negative determinant of technical inefficiency. Based on the findings of the study, since fresh fruit bunch (FFB and labour costs were positive and significant determinants of palm oil processed more of these productive resources should be used. The variables – fire wood, water and depreciated costs were negative but significant determinants of palm oil produced. It was recommended that less of these resources should be used. The need for processors/producers to thrive to maximize the use of productive resources was recommended.