The Utilization Pattern and Economic Evaluation of Fuelwood Enterprise: A Case Study of Some Areas in Ibadan Metropolis, Oyo State
The problem of cooking fuel scarcity was exacerbated by increasing energy crisis in the world which makes conventional fuel derived from crude oil less affordable. Yet the current reserve potential of 80 million cubic metres of fuelwood per year in Nigeria is still underutilized.This study therefore evaluated the profitability and factors influencing fuelwood profitability among marketers in the study area. Oja’ba, Mapo - Beere, Ayeye, Orita – merin and Opo-oyiosa were purposely selected for this study while a total of 100 households were used for the study. Both Descriptive and quantitative techniques were employed in the analysis of the data gathered through questionnaire administration. The result showed that majority of households used fuel wood for cooking purposes and that the marketing of this product is highly profitable. A total of N718, 500.00 is realized as total revenue while a total cost of N177, 700.00 is incurred per year in fuel wood marketing. Labour cost accounted for the highest percentage (42.2%) followed by cost price of the log of fuel wood itself (37.2%) and then transport expenses (10.69%) of the total cost. The total variable cost constituted 95% while the fixed cost constituted 5% of the total cost. The enterprise had an average net income of N540, 800.00 per year. The average Profitability Index for all farms was 0.75, indicating that out of every N10 earned; about N7.5 accrue to the marketer as profit after accounting for all cost. Also, an RRI of 304% revealed that a marketer earns N304 profit on every naira spent on fuel wood business while the RRVC of 397.28% indicates that every N1 cost incurred on variable inputs generates about N397. Moreover, the OR of 0.23 indicates that every N10 spent on total variable cost yields N2.30 as total revenue. Since the marketing of fuel wood holds a great potential for income generation as it was found to be a very profitable business, the study therefore recommends that unemployed youths can be trained on the rudiments of sustainable harvesting and marketing of fuel wood products as a way of alleviating poverty in areas where forest is very dense and under-utilized, thereby easing the burden of unemployment without necessarily resulting into deforestation in Nigeria. Also government policy on promoting family planning and entrepreneurial education to the citizens in an informal setting is hereby canvassed.
Fuel Wood, Utilization, Supply, Profitability and Ibadan Metropolis
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