CHAPTER ONE
INTRODUCTION
1.1 Background to the Study
Agriculture plays a significant role in the growth of Nigeria’s economy especially, as it contributes over 20.89 percent of the nation’s Gross Domestic Product (GDP), offers 66 percent employment to her populace, accounts for 50 percent of the sources of raw materials required by industries for further production, provides 80 percent food for man and market for other industrial goods as well as export earnings (NBS, 2014). Despite these, agricultural production in Nigeria is subsistence, as a result of low utilization of modern inputs by farmers, unavailability and inaccessibility of farm land as well as low mechanized nature of the prevailing agricultural production system. Therefore, to improve the national economy, farmers should be supported to expand their scale of production through financial resource, such as credit (Akpokodje and Olomola, 2000).
Okurut, Banga and Mukuga (2004) affirmed that associated with mechanization and acquisition of agricultural inputs is the issue of credit without which the envisaged agricultural production and development will be a mirage. Inadequate access to credit by the smallholder farmers has been identified as one of the contributing factors to poverty. Credit allows farmers to satisfy their cash needs induced by the production cycle which characterizes agricultural production.
Credit supply to farmers is widely perceived as an effective strategy for enhancing increase in agricultural productivity and transformation of rural economy (Philip, Ephrain, and Omobowale, 2008). According to Mahmood, Okpara, Rahji and Ogwumike (2009), the introduction of easy access and low interest rate credit is the quickest way for boosting agricultural production. The argument is that the agricultural sector depends more on credit than any other sector of the economy because of the seasonal variation in the farmer’s returns and requirement in transformation of subsistence to commercial farming.The provision of credit as noted by Rosemary (2001) has increasingly been regarded as an important tool for raising the income of the rural populace, mainly by mobilizing resources to more productive uses.
Cowpea is an important major staple food crop in sub-sahara Africa, especially in Nigeria. The seeds are major source of plant protein and vitamins to man and feed for animals. The young leaves and immature pods are eaten as vegetables. The sale of cowpea seeds and fodder earns income to the farmers. In Nigeria, farmers who cut and store cowpea fodder for sale at the peak of dry season have been found to obtain as much as 25% of their annual income by this means. Cowpea also plays an important role in providing nitrogen to the soil when included in crop rotation system (Okunmadewa, 2009).
In Nigeria, the greatest production comes from northern region with about 1.7million tonnes from 4 hectares. This represents over 60 percent of total production. The producing areas are Niger, Kano, Sokoto, Kaduna, Zamfara and Gombe State. Despite that cowpea yield is very low, grain yield range between 100-300kg/ha. This is due to several constraints such as weather, parasitic weeds, insect-pests and diseases (Olamola, 2009). In Niger State, cowpea production is rain fed, usually planted between the months of April-May for early variety and July-August for late variety. It is worth noting that cowpea production is dominated by small scale producers in the state who employ traditional practices and inadequate techniques with resultant negligible outputs and low supply of commodity despite its high demand (Adrew, 2012). Low production efficiency and inaccessibility of credit have been implicated as some of the culprits leading to low outputs.