An Analysis of Price Efficiency of Catfish Grow-out in Nigeria

The objective of this was to estimate the price efficiency of catfish grow-out production in Nigeria using parametric stochastic frontier and cost functions. A sample of 143 fish farmers using flow through system were purposively selected from the twenty Local Government Areas in the State for the interview. Data regarding input-output relations and socio-economic properties of farms were collected for the production season of 2012-2013. Price efficiency measures were derived for this sample by employing parametric stochastic frontier analysis (SPF). Finally, socio-economic factors affecting efficiency levels are estimated with a Tobit estimation procedure. The analysis shows that the mean price efficiencies are found to be 36.0%, 70.0% and 62.08% for plastic, fibre and concrete tanks respectively. These scores indicated that the inefficiencies in fish production are not trivial for farmers using concrete and fibre but trivial for plastic indicating considerable allocative inefficiency. Analysis of the role of various socio-economic factors on productive efficiency shows that the size of the farm, age, education, experience and machinery were found to be important determinants of price efficiency. A policy implication of this study is that there are more potential for farmers to increase fish production and net profit.