Economic Factors of Small-Scale Processing of Palm Oil at Kwabirim District in Ghana

Abstract Book of the 11th International Conference on Research in Management and Economics

Year: 2026

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Economic Factors of Small-Scale Processing of Palm Oil at Kwabirim District in Ghana

Joseph Kwabina Arhinful Johnson

ABSTRACT:

Among the world’s existing vegetable oils, the most traded for is palm oil. For the past three decades, its production level has tripled than any other oil crop. In order to increase not only the quantity of palm oil but also the quality of food available for consumption and trade, there is an urgent need to assess the economic effect of the palm oil processing industries. This study was to assess the profitability of palm oil processing enterprises, determine the factors affecting the net returns of the small-scale processors and identify and rank constraints faced by the processors. The net farm income approach, linear regression model and Kendall’s coefficient of concordance were models used. Well-structured questionnaires were given to Fifty (50) processors who were randomly selected from Kwabibirim district in Ghana. The study result shows that the enterprise was profitable and thus viable to invest. Factors affecting the net return of the processors significantly are labour, volume of palm oil produced, price of palm oil and the price of fresh fruit bunches. In conclusion, the determinants of net return showed that labour cost and the price of fresh fruit bunches were negatively but significantly related with the net return and volume of palm oil produced and price of palm oil are positively and significantly associated with the net returns of the oil palm processors. The study recommends that processors should form co-operatives to enable them gather their resources and control prices.

Keywords: Palm Oil; Net Farm Income; Linear Regression