Correlates of Risk-Aversion among Poultry Egg Farmers in Ibadan, Nigeria

Poultry production is largely faced with a number of risks. In this study, sources of risk, attitude of farmers towards risk, the determinants and risk management strategies adopted by farmers were examined. Primary data from 74 respondents were collected using cluster sampling method with the aid of a well-structured questionnaire. Descriptive statistics, composite analysis, safety first behavioural model and the censored Tobit model were the analytical tools employed. The most prevalent source of risk in the study area was fluctuation of input prices (75.3%) and the least encountered risk source was inefficiency of workers (12.2%). Average poultry egg farmer in the study area experienced at least one source of risk. The respondents were found to exhibit low risk aversion and risk-aversion was significantly increased by cost of labour, number of layers in battery cage system and number of layers in deep litter system. However, years in poultry farming and amount of credit received significantly reduced the risk aversion among the farmers. The most used risk management strategy was relaxation of pen before re-stocking them (97.3%). Farmers should be encouraged to insure their farms and extension services should be made readily available to farmers. Enabling policy environment towards an effective credit programme should be facilitated while attention should also be shifted towards protection of farmers against input price variations.