ABSTRACT

The study examined the effects of Agricultural credit on the output and profitability of egg farms in Abia State, Nigeria. Specifically an attempt was made to examine the socio-economic characteristics of egg farmers, estimate the production, cost and profit functions and the constraints to egg production in the study area. A total of 100 egg farmers were selected using purposive random sampling from three (3) Local Government Areas (LGAs). A well structured questionnaire was used to collect the primary data. The Cobb Douglas functional form was used to estimate parameters of the specified production function while the linear functional form for total variable cost and profit functions respectively. Results of the production function analysis showed that the total quantity of feed and cost of drugs supplied to the laying birds significantly and positively influence the egg output at 1% and 5% levels respectively. For the profit function, the results revealed that the total output of eggs, agricultural credit and average price of eggs per crate had positive and significant effects on profit at 1% and 5% levels respectively while for the total variable cost (11/C) functions, the total output of eggs and agricultural credit were the variables that had significant effect on the TVC at 1%. Agricultural credit had negative influence on TVC which suggests that those with credit had decreased TVC which lead to increased profits compared to those who had no access to credit. Major constraints facing egg production in the study area in decreasing magnitude of importance were; High cost of feed (13.84%), Inadequate capital (12.81%), Disease incidence (1O.75%), High cost of drugs (1O.6%), Transportation problems (1O.Ol%), Lack of collateral (8.39%), and Marketing problems (7.36%). It was recommended that farmers should establish Egg Farmers' Co- operative and should be encouraged by government by way of providing credit facilities as well as suitable credit policies to be adopted.