Effect of Socio-Economics Characteristics, Production and Innovation Capabilities on the Performance of Palm Kernel Processing Firms in Southwestern Nigeria

Abstract

he study assessed the impact of production and innovation capability on performance of the firms in this sector. The study covered Osun, Oyo, Ogun and Ondo States in southwestern Nigeria. The sample population of 265 respondents was obtained through respondent driven sampling techniques tools. The research tools used were questionnaire, personal observations, interviews and secondary data collection approach. The questionnaire was administered to palm kernel processor and elicited information on socio-economic characteristics of the respondents, profile of the firms, production capabilities possessed by the palm kernel processors, innovations available in the firms. Both descriptive and inferential statistical techniques were employed for data analysis I. INTRODUCTIONPalm kernel is a by-product of the palm oil industry. It constitutes about 45% of the palm nut of the palm oil Elaeis guineensis (Rossell, 1985;Goh, 1993 and Kadir et al., 1998). It can be processed into palm kernel oil (PKO) and palm kernel cake (PKC). Palm kernel oil is rich in Lauric acid, G12 (48.3%) but also contains other major fatty acids such as myristic, extracted using screw press with 40-43% (g oil/100g kernel) yield or liexone extracted with 44.5%-46.5% yield (Tang and Teoh, 1985). According to Gbasouzor et al., (2012) palm kernel oil is a white to yellowish oil of vegetable origin which is solid at normal temperature and is obtained from the kernel of the oil palm fruit (Elaesis guineensis). It is one of the best oil, which is obtained from the flesh of the fruit Gbasouzor et al., 2012). Malaysia produced about 2.4 million metric tonnes of palm kernel and about 1.1 million metric tonnes of crude palm kernel oil in 1998 (Porla, 1998). Hassan et al. (1999) emphasized that PKO is a high quality oil for food use and a valuable component of margarine formulation, giving rapid melt down of PKO in the mouth characteristics (Siew and Begger, 1981). Its high solid content at 15-20°C, together with rapid melt down, makes it particularly useful in confectionery products. It is commercially fractionated into liquid olein and solid stearin, the latter being a premium product (Hassan et al., 2000).However, production of PKO in Nigeria was poor and such vegetable oils are important to meet demands. According to estimates, the total money Nigeria spent to import vegetable oil from Malaysia in 2001 was $186.65 million.It has been estimated that production-consumption margin is increasing by thousand tonnes naturally because of population growth and rise in per capital income (Vanguard, 2002). In 2003, World production PKO was 3236 metric tons out of which Malaysia produced 1644 metric tonnes of PKO (MPOB, 2003).The PKC is obtained from two stages of oil extraction from the palm fruit. The first stage is the primary extraction of palm oil from the pericarp portion of the fruit, which also produces the kernel and by-products Palm Oil Sludge and Palm Press Fiber. The extraction of oil from crushed kernel then results in the production of PKC as...