Saleh Abdullahi^1,, Kolo Abdulwahab², Garba Sadiq Abubakar³

The study examined the profit and market efficiency of small-scale modern groundnut oil extraction of RMP-12 and Ex-dakar varieties in Gombe Metropolis Nigeria. A multi-stage sampling technique was used to select 90 small-scale groundnut oil processors. Data were collected using structured questionnaires and were analysed using farm budget, sherphered-futrel and paired t-test models. The results revealed that costs of shelled groundnut constituted the major (92.3% and 91.6%) components of processing costs for RMP-12 and Ex-dakar groundnut varieties respectively. The gross ratio and operating ratio were all < 1, meaning that the business was profitable. Also, the returns per naira of RMP-12 and Ex-dakar were ₦ 0.17 ($ 0.0006) and ₦ 0.25 ($0.0009) respectively. The marketing coefficient revealed Jekadafari markets (69.97%) to be most efficients in the case of Ex-dakar products. The results further revealed 82.29% and 74.83% of the gross margins of respective RMP-12 and Ex-dakar varieties were spent on marketing costs, with the remaining 17.71% and 25.17% were retained as the net profit and diffrence was significant (P<0.01). Despite the fact that RMP-12 variety gave higher gross income, the study concluded that the Ex-dakar variety performed better. Major impediments to profit and market efficiency were inadequate capital, high costs of shelled groundnut and transportation costs. It is therefore recommended that, the traders should have access to formal loans so as to improve productivity and efficiency.

gross margin, efficiency, groundnut, extraction, small-scale