Determination Of Resilience Of Broiler Farmers

Determination Of Resilience Of Broiler Farmers

Chapiter 1

Introduction

1.2.1 Background Data

Even as the industrial and service sectors continue to expand, agriculture remains a crucial part of the global economy. Globalization and climate change have an impact on African agriculture, yet the continent’s economy and social development nevertheless rely heavily on the sector. In the majority of African nations that don’t export oil, agriculture is recognized as the most significant economic sector.

Providing financing, equipment, fertilizer, seeds, etc. for agricultural output is referred to as agribusiness. A modern form of agricultural business activities run solely for financial gain is known as small-scale agribusiness (Olayide and Heady, 1982; Downey and Erickson, 1987). The agricultural sector is split into small, medium, and big scale firms, according to Chukwuma (1999). Agriculture is a privately owned and run industry. The following characteristics could apply to it:

The same person frequently has both management and ownership responsibilities.

They typically have a minimal market share and no market domination.

Small amounts of capital are typically made available by the owner(s).,

Typically, they employ fewer than 100 people.

Businesses in the agribusiness sector are essential to the expansion and development of Nigeria’s economy. According to Omeresan (2004), businesses must create and implement effective strategies if they want the agriculture industry to thrive in the current unstable business environment. Such tactics ought to be well researched. The physical, institutional, and economic shocks in Nigeria may severely restrict the viability and expansion of agro operations. (2004) Adebayo et al. A growing number of African agribusiness companies were involved in the international commerce of agricultural goods throughout the second half of the 19th century. This happens as a result of greater trade, rising European affluence, and rising demand for tropical goods. Sub-Saharan Africa (SSA)’s local production systems benefited greatly from this development (Mkpado, 2012). Over the ensuing decades, agribusiness on a global scale is anticipated to face numerous difficulties. It is impossible to deny how important the link between agriculture and the rural sector is to agribusiness. This is so that agribusiness can, through their necessary infrastructure, increase employment, raise incomes, reduce poverty, and provide Corporate Social Responsibility (CSR) (Dike, 1991; Anyanwu; 1997; Dunmoye).

The responsibility of agribusiness firms is to increase food production to meet the needs of a growing and increasingly affluent global population that will demand a more varied diet, to aid in overall development and the reduction of poverty in many developing nations, to contend with increased competition for alternative uses of limited land and water resources, to adapt to climate change, and to preserve biodiversity and restore fragile ecosystems. The rural poor’s incomes have continued to be significantly influenced by agriculture. Increasing global food supplies on a sustainable basis requires increasing agriculture production while preserving and strengthening natural resources. Smallholder agriculture plays a critical role in boosting sustainable productivity growth in the sector. The majority of agriculture companies often have lower productivity.

According to agribusiness literature, resilience is defined as either survival, if a firm is able to remain open following a disruption, or how long a business is able to do so (Wasileski et al., 2011; Stafford et al., 2010). According to some business research, resilience is defined as a return to pre-disaster activity levels, such as the level of employment and profitability before the crisis (Brewton et al., 2010). In the immediate aftermath of a tragedy, a firm is classified as either being closed or opened, according to Marshall and Schrank (2014). If a business is unable to restart during period two, it is deemed demised. Open businesses might be categorized as having survived, recovered, or been resilient. A company is considered to have survived if its employment and profit levels are below those of the pre-disaster period. A business that has survived is one that can pay its fixed and variable expenses and is still performing at its pre-disaster levels. A process of adaptation is resilience. Either the company made improvements to their operation to be ready for any future shock that may occur during production, or they were sufficiently prepared to bear the impact of the calamity with little impact. The first kind of company is regarded as resilient. After making the necessary adjustments, the second kind of firm might be seen as resilient, but this resilience won’t be put to the test until a comparable crisis strikes.

Resilience was described by Terney and Bruneau (2007) in terms of both intrinsic and adaptive resilience. The ability of the poultry farms to operate effectively outside of times of crisis is referred to as inherent resilience. Within the system, it is already built. The ability of the poultry farms to show flexibility during and after disasters, i.e., the ability to adapt and exercise creativity in addressing disasters when they occur, is referred to as adaptive resilience.

According to Vaitla et al. (2012), resilience is “the ability of an agribusiness firm to manage change, by maintaining or transforming living standards in the face of shocks or stresses—such as earthquakes, drought, or violent conflict—without compromising their long-term prospects.” Some factors influence a firm’s elasticity to shock, determining whether and why farm businesses “bounce back better,” “bounce back,” “recover, but worse,” or “collapse.”

An outline of guiding principles for building crisis resilience is given by Frankenberger et al. (2012) with a focus on donor organizations. Resilience was defined by them as the capacity of nations, communities, households, and businesses to effectively prepare for, respond to, and recover from the effects of potentially dangerous occurrences (natural disasters, economic instability, and conflict) in a way that safeguards livelihoods, accelerates and sustains recovery, and supports economic growth. Additionally, they stress how critical it is to foster multi-sectoral coordination in order to increase resilience.

DFID’s approach paper from 2011 states: Disaster resilience is the capacity of nations, communities, households, and businesses to manage change by upholding or changing their performance in the face of shocks or stresses, such as earthquakes, droughts, or armed conflict, without jeopardizing their long-term prospects. The analysis of the context, the disturbance (shocks or long-term stresses), the capacity to deal with the disturbance (which depends on the degree of exposure, sensitivity, and adaptive capacity), and the reaction to the disturbance are all included in the resilience framework. Resilience is a concept that has brought together work in a variety of areas, including (i) disaster risk reduction, (ii) adaptation to climate change, and (iii) social protection. According to DFID (2011), assessing a farm’s resilience status might be a helpful strategic tool for preventing the fragility and insolvency of agribusiness enterprises. The ability of these businesses to produce resilient agribusiness will positively affect agribusiness productivity, which will have global repercussions on improving food security, wellbeing, and sustainability as well as securing enough raw materials for expanding agribusiness enterprises (Interagency Report to the Mexican G20 Presidency, 2012).

Research and policy discussions have long recognized the economic significance of the poultry-based agriculture industry, including its contribution to the GDP or the generation of jobs. Recently, researchers have looked into the beneficial societal benefits made by the chicken industry. A increasing body of research is recognizing the potential contribution of the poultry agribusiness sector to strengthening the push for national economic diversification and the overall resilience of the national economy to financial and non-financial variables.

However, the ability of the poultry agribusiness to adapt to the constantly shifting economic environment will determine how much it can contribute to the development of the national economy. In order to shape the resilience of chicken agribusinesses in Delta state, Nigeria, it is crucial to examine the resilience status, resilience features, and evaluate how successfully entrepreneurs adopt features.

The study by Steiner and Cleary (2014) proposes three domains, namely context/location domain, business specific/profile domain, and entrepreneurial inventive characteristics/risk taking domain, that determine business resilience. The location of the company is determined by whether it is in an urban or rural area. The profile domain is based on the sort of business, whereas the risk-taking domain is the entrepreneur’s capacity to take risks by using new inventions without taking into account the risks involved. If these areas are thoroughly explored, the poultry agribusiness sector’s resilience status against endogenous and external causes will be improved.

Therefore, to deal with stress or business shocks, the agriculture sector can adopt resilience-enhancing activities including the creation of social/human, technological/physical, financial/economic, natural/environmental, and political assets. This can only be justified by looking at how resilient the chicken farms in Nigeria’s Delta state are.

1.2 Description of the issue

The poultry industry has been frequently troubled by bankruptcy, which has decreased the number of operational poultry farms and their contribution to national development. The Nigerian government has concentrated its efforts on helping troubled poultry farms recover and become more robust to interruptions. This study examines the determination of the resilience of broiler farms in Delta state, Nigeria, with the goal of supporting the national purpose of resilience-building of poultry farms. The initial step in the bailout mechanism for failing poultry farms is determining the firm’s resilience status. The financial and non-financial characteristics of the poultry farms are crucial for the viability of the poultry (broiler) agribusiness. Some business owners lack the necessary knowledge about the elements that contribute to company failure or the business resilience indicators needed to handle shocks or disruptions when they happen. Analyzing resilience domains will be necessary in order to deal with these characteristics. The key to developing the poultry industry is to identify the origins of poultry farms’ resilience capability and how it may be improved. Despite its importance to economic development, an empirical research of the resilience status of poultry (broiler) farms has not yet been conducted in Delta state. To date, no estimation model of resilience index has been created or deduced to assess the sustainability or continued existence of chicken farms. The resilience status of poultry (broiler) farms and related issues need to be determined through concentrated efforts.

1.3 Study’s Objectives

This study’s main goal is to evaluate the resiliency of Nigeria’s Delta State’s broiler farmers. In particular, the study is planned to;

(i) Determine the Delta State broiler farms’ resilience index.

(ii) Determine the Delta State broiler farms’ resilience level.

The proportion of resilient and non-resilient broiler farms in the research area should be determined (iii).

(iv) Identify the monetary elements supporting the hardiness of broiler farms.

(v) Identify the non-financial variables supporting broiler farms’ resilience.

1.4 Research Problem

The following research issues were addressed by the study’s design.

(i) What is the Delta State broiler farms’ resilience index?

What are the Delta State broiler farms’ resilience levels?

What percentage of broiler farms in the research area are resilient and non-resilient?

What financial aspects support the resilience of broiler farms?

What non-financial elements support the sustainability of broiler farms?

1.5 Research Propositions

These theories will serve as a guide for this study.

H01: The resilience status of broiler farms is unrelated in a positive and significant way to retained earnings, contingency fund, and liquidity ratio.

H02: The resilience status of the broiler farms has a bad link with the debt equity ratio.

H03: There is no positive and significant association between the resilience status of broiler farms and factors such income stability, social network participation, availability to necessities, self-motivation, adaptable capabilities, and innate characteristics.

H04: There is no positive or significant association between the resilience status of the broiler farms and the resilience threshold gap.

1.6 Importance Of The Research

It is impossible to overstate how important this study is. It will, however, reveal the resilience index for broiler farms in Delta State, the resilience status of the farms there, the percentage of resilient and non-resilient farms in the study area, the financial and non-financial factors that support resilience in broiler farms. Additionally, other people who want to start a broiler farm will find this letter helpful for their need for fundamental information. Notably, this study will also be a source of data for academics and students.

1.7 Study’s Purpose

The purpose of this study is to evaluate the adaptability of broiler producers. Nigeria’s Delta State will be the study’s geographic focus. However, the study’s respondents would be drawn from and among broiler farm communities in Delta state, Nigeria.

1.8 Study Restrictions

The main obstacles the researcher had in conducting this research were the lack of funding, the lack of materials, and the time needed to balance both academic work and the research work.

1.9 Term Definitions

A young chicken suited for roasting, grilling, or barbecuing is a broiler.

In poultry farming, domesticated birds including chickens, ducks, turkeys, and geese are raised for their flesh or eggs for human use.

Value is the monetary, material, or estimated worth of a good, service, or asset.