INTERNATIONAL JOURNAL OF RESEARCH AND INNOVATION IN SOCIAL SCIENCE (IJRISS)  
ISSN No. 2454-6186 | DOI: 10.47772/IJRISS | Volume IX Issue XII December 2025  
Competition and Market Concentration in Tamarind Processing and  
Marketing: Insights from the Herfindahl-Hirschman Index and  
Concentration Ratio.  
Authors: Idahosa, E.O., Agbonkpolor, B.N, Umar. H.Y., Emokhare. Q.I., Ewekhare. B.T., Ogwu. A.D.  
Research Outreach, Rubber Research Institute of Nigeria  
DOI: https://doi.org/10.47772/IJRISS.2025.91200074  
Received: 15 December 2025; Accepted: 22 December 2025; Published: 31 December 2025  
ABSTRACT  
This study examines the market structure, level of competition, and concentration among tamarind processors  
and marketers in Kano, Kaduna, and Nasarawa States of northern Nigeria. Using primary data from 2025 and  
employing the Herfindahl-Hirschman Index (HHI), the study assesses the distribution of market shares and the  
extent of dominance among participants in the tamarind value chain. Results show that the processing segment  
is highly competitive and atomistic across all states, with extremely low HHI values of 0.0000329 (Kano),  
0.0000289 (Kaduna), and 0.0000196 (Nasarawa). The marketing segment demonstrates varying levels of  
competition, with Kano showing moderate concentration (HHI = 0.0022862), while Kaduna (0.0006102) and  
Nasarawa (0.0001246) exhibit low concentration and high competitiveness. The findings highlight a vibrant but  
fragmented industry characterized by low market power, limited economies of scale, and significant  
opportunities for new entrants. The joint application of CR₄ and HHI reveals a tight oligopolistic market structure  
in Kano State and highly concentrated, near-monopolistic structures in Kaduna and Nasarawa States, indicating  
significant market dominance by a few firms in tamarind processing.  
INTRODUCTION  
Tamarind (Tamarindus indica) contributes significantly to rural livelihoods in northern Nigeria. Understanding  
market structure and competition within its value chain is essential for evaluating market performance and  
designing appropriate policy interventions Tamarind (Tamarindus indica) plays an increasingly important role  
in Nigeria’s non-timber forest product economy, particularly in northern states where processing and marketing  
offer income opportunities for rural households. However, understanding the extent of competition and market  
concentration in the tamarind value chain is crucial for assessing market performance, efficiency, and  
sustainability.  
Market structure influences pricing behavior, revenue distribution, and the potential for firms to wield market  
power (Bain, 1959). The Herfindahl-Hirschman Index (HHI) has become a widely accepted tool for evaluating  
market concentration globally, with lower values signifying competitive markets and higher values indicating  
monopolistic tendencies.  
Despite the economic relevance of tamarind, empirical studies on its market structure remain scarce. This study  
contributes to addressing this gap by evaluating competition among processors and marketers across Kano,  
Kaduna, and Nasarawa States using the Herfindahl-Hirschman Index (HHI).  
METHODOLOGY  
Study Area  
The study was conducted in Kano, Kaduna, and Nasarawa States, which are major producers and marketers of  
tamarind in Nigeria. Each representing key nodes in northern Nigeria's tamarind value chain.  
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INTERNATIONAL JOURNAL OF RESEARCH AND INNOVATION IN SOCIAL SCIENCE (IJRISS)  
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Data Collection  
Primary data were collected from processors and marketers across the three states using structured  
questionnaires. data were obtained from 384 respondents comprising 171 processors in Kano, 133 in Kaduna,  
80 in Nasarawa, and marketers across the three states. Data were collected on revenue levels, market share, and  
operational characteristics.  
Sampling procedure and sample size  
A multistage sampling procedure was employed to select the study sample.  
Step 1:  
Three states Kano and Kaduna and Nasarawa, were purposively selected due to their high levels of tamarind  
processing and marketing activities.  
Step 2:  
Within each state, Purposive sampling was use to select four (4) Local Government Areas (LGAs) with the most  
significant tamarind processing and marketing activities.  
Step 3:  
Subsequently, one (01) community each was selected using a simple random from a local government area to  
make it four communities each in a state. Yamanes formula was used to determine the number of respondents to  
be allocated to each states from the sample frame. Yamanes formular states:  
n = N÷ 1+N(e2)  
n = sample size  
N = Estimated Sample Size  
e = margin error ( 5% or 0.05)  
Kano Sample Size;  
N = 300 processors and marketers (ADP Kano)  
n = ?  
n = 300÷1 + 300(0.05)2  
n = 171(Kano)  
Kaduna Sample Size:  
N = 200 Processors and marketers (ADP Kaduna)  
n = 200÷1+200(0.05)2  
n = 133 (kaduna)  
Nasarawa State Sample Size  
N = 100 Processors and marketers (ADP Nasarawa State)  
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INTERNATIONAL JOURNAL OF RESEARCH AND INNOVATION IN SOCIAL SCIENCE (IJRISS)  
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n = 100÷1+100(0.05)2  
n = 80  
Step 4:  
Proportionate sampling percentage was used to determine the number of respondents per community.  
Proportionate sampling percentage was used for each LGA’s  
ni =( Ni÷N)n  
Percentage = (Ni ÷N) × 100.  
Where Ni = population of the subgroup  
N = Total population  
171  
Kano = (  
) x 100 = 42.75 (43%) for the 4 LGA.’s  
384  
133  
Kaduna = (  
) x 100 = 35% for the 4 LGA’s  
384  
Nasarawa = 80×100÷384 = 20% for the 4 LGA’s  
= 20%  
Sampling Frame and Sample Size  
States under  
study  
LGA’s  
selected  
Numbers  
Communities  
of Numbers  
of Estimated  
population  
Sample Frame  
respondents  
selected  
to select  
300  
marketers  
and  
44.5%  
respondents  
from  
community  
using  
Madobi,  
Dawakin  
Tofa , Kano-  
South and  
04  
04  
04  
300  
Kano State  
processors (ADP Kano  
State)  
-
each  
Kano-Central  
proportionate  
sampling (171)  
200  
preocessors  
Kaduna State)  
marketers  
and  
(ADP  
34.6%  
respondents  
from  
community  
using  
Chikun  
200  
100  
Kaduna State  
Zaria,  
each  
Kaduna-South  
and Kaduna-  
North  
proportionate  
sampling (133)  
100  
Lafia,  
20.8%  
20respondents  
from  
4community  
each.(80)  
Nasarawa  
State  
Processors/Marketers  
(ADP Niger State)  
Nasarawa  
Eggon,  
Akwanga,  
Awe  
the  
12  
384  
600  
3 States  
600  
12 LGA’s  
Communities  
Respondents  
Population  
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INTERNATIONAL JOURNAL OF RESEARCH AND INNOVATION IN SOCIAL SCIENCE (IJRISS)  
ISSN No. 2454-6186 | DOI: 10.47772/IJRISS | Volume IX Issue XII December 2025  
Analytical Technique  
Market concentration was evaluated using the Herfindahl-Hirschman Index (HHI), and Concentration Ratio.  
HHI computed as the sum of squared market shares. Both indices are used to ensure the robustness . Using both  
allows you to capture dominance at the top (CR) and overall concentration (HHI).  
The Herfindahl-Hirschman Index (HHI) was applied to determine market concentration. HHI was computed  
as:  
HHI = ∑i=1N si2  
Where si represents the market share of each firm expressed in percentage, N= number of firms in the market.  
Interpretation follows U.S. Department of Justice standards:  
HHI < 0.01: Highly competitive/unconcentrated  
0.01 ≤ HHI ≤ 0.15: Moderately concentrated  
HHI > 0.15: Highly concentrated/monopolistic  
Descriptive statistics complemented the HHI analysis.  
CR₄ < 40% → Competitive market  
CR₄ = 40–59% → Loose oligopoly  
CR₄ = 60–79% → Tight oligopoly  
CR₄ ≥ 80% → Highly concentrated / near monopoly  
3. Results and Discussion  
Market Structure of Tamarind Processors  
Table 1: Market Structure of Tamarind Processors in Kano, Kaduna, and Nasarawa States  
Variable  
Kano (n=133)  
2,436,789  
Kaduna (n=77)  
2,181,117  
Nasarawa (n=8)  
1,794,438  
Mean revenue (₦)  
Mean revenue share  
0.0035936  
0.0032165  
0.0026463  
Herfindahl-Hirschman  
(HHI)  
Index 0.0000329  
0.0000289  
0.0000196  
Source: Field Survey, 2025  
Market Structure of Tamarind Marketers  
Table 2: Market Structure of Tamarind Marketers in Kano, Kaduna, and Nasarawa States  
Variable  
Kano  
Kaduna  
1,937,415  
0.001405  
Nasarawa  
439,980.80  
0.0006946  
Mean revenue (₦)  
Mean revenue share  
1,160,592  
0.0024852  
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INTERNATIONAL JOURNAL OF RESEARCH AND INNOVATION IN SOCIAL SCIENCE (IJRISS)  
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Herfindahl-Hirschman  
Index (HHI)  
0.0022862  
0.0006102  
0.0001246  
Source: Field Survey, 2025  
Market Structure of Tamarind Processors  
The market structure for processors across the three states is summarized in the Table 1 above.  
Revenue Levels and Market Participation  
Mean revenue varied significantly across states, with Kano leading (₦2,436,789), followed by Kaduna  
(₦2,181,117) and Nasarawa (₦1,794,438). Kano's higher revenue aligns with its large market size, better-  
developed processing infrastructure, and integration into regional and cross-border trade networks (Abdulsalam  
& Ibrahim, 2021). Nasarawa’s much lower revenue suggests limited processing activity or reduced access to  
markets.  
Market Fragmentation and Revenue Share  
The mean revenue share across processors was very low in all states, indicating that no single processor  
commands a dominant share of the market. This high level of fragmentation is typical of agro-processing sectors  
dominated by micro- and small-scale  
enterprises (Adebayo et al., 2020). The small market shares also reflect intense inter-firm competition and limited  
ability to influence market prices.  
Market Concentration (HHI Analysis)  
HHI values for processors were extremely low:  
Kano: 0.0000329  
Kaduna: 0.0000289  
Nasarawa: 0.0000196  
These values are far below the 0.01 threshold, indicating a highly competitive market. The findings align with  
Ume et al. (2020), who reported similar levels of fragmentation in informal agricultural processing clusters in  
Nigeria.  
Implications:  
Wide participation and open entry characterize the processing sector.  
However, the absence of dominant players may reflect limited access to capital, technology, and scaling  
opportunities.  
Policymakers may need to address structural constraints inhibiting enterprise growth.  
Market Structure of Tamarind Marketers  
Kano: Moderately Concentrated Market  
Results in Table 2 shows that Kano recorded the highest HHI (0.0022862), suggesting a moderately concentrated  
marketing structure. While numerous marketers operate in the state, a few large marketers still exert noticeable  
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INTERNATIONAL JOURNAL OF RESEARCH AND INNOVATION IN SOCIAL SCIENCE (IJRISS)  
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influence over market dynamics. Barriers such as capital requirements and established distribution networks  
may contribute to this moderate concentration.  
Kaduna: Competitive and Fragmented Market  
With an HHI of 0.0006102 and a low revenue share (0.001405), Kaduna’s tamarind marketing landscape is  
highly competitive and characterized by many small-scale marketers. The openness of the market creates room  
for new entrants but may limit the ability of businesses to scale.  
Nasarawa: Most Fragmented Market  
Nasarawa had the lowest HHI (0.0001246), indicating the most competitive and fragmented market among the  
three states. The very small revenue share shows that no marketer has significant influence. While beneficial for  
market access and price competition, this extreme fragmentation may constrain profitability and discourage  
investment in value-adding activities.  
Market Concentration (CR4 Analysis)  
Concentration Ratio (CR₄) Analysis for Kano State  
firms arrange by market share (largest to smallest)  
Firm 5 = 25.9%  
Firm 1 = 23.3%  
Firm 2 = 15.2%  
Firm 7 = 9.7%  
Step 2: Compute the Concentration Ratio (CR₄)  
CR₄ = Market share of the four largest firms  
CR₄ = 25.9% + 23.3% + 15.2% + 9.7%.  
CR₄ = 74.1%  
Interpretation  
The four largest tamarind processing firms in Kano State control 74.1% of the total market share, indicating a  
high level of market concentration.  
Based on standard concentration ratio benchmarks:  
CR₄ < 40% → Competitive market  
CR₄ = 40–59% → Loose oligopoly  
CR₄ = 60–79% → Tight oligopoly  
CR₄ ≥ 80% → Highly concentrated / near monopoly  
A CR₄ value of 74.1% places the Kano tamarind processing market within a tight oligopolistic market structure.  
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Economic Meaning  
A few dominant firms exert significant control over the market.  
Smaller firms exist but have limited influence on pricing and output decisions.  
There is potential for market power, price coordination, and barriers to entry.  
Competition exists, but it is not perfectly competitive.  
The concentration ratio analysis reveals that the four largest tamarind processing firms in Kano State account  
for 74.1% of total market share, indicating a tight oligopolistic market structure. This suggests that market  
activities are dominated by a few large firms, with implications for competition, pricing behavior, and market  
access for smaller processors.  
Concentration Ratio (CR₄) Results for Kaduna and Nasarawa States  
The concentration ratio analysis reveals extremely high levels of market concentration in both Kaduna and  
Nasarawa States.  
In Kaduna State, the CR₄ value of 99.3% indicates that the four largest tamarind processing firms jointly control  
almost the entire market. This level of concentration signifies a highly concentrated market structure, bordering  
on near monopoly. The dominance of a few firms suggests substantial market power, limited competitive  
pressure, and significant barriers to entry for smaller processors.  
Similarly, Nasarawa State records an even higher CR₄ value of 99.9%, implying that virtually all market  
activities are controlled by the top four firms. This reflects an extreme form of market concentration, consistent  
with a near-monopolistic or dominant oligopolistic structure. In such a market, competition is minimal, and  
pricing as well as output decisions are likely influenced by the dominant firms.  
Comparative Insight and Policy Implications  
When compared with Kano State, which  
exhibits a tight oligopolistic structure, both Kaduna and Nasarawa States display far weaker competitive  
conditions. The overwhelming concentration observed in these states suggests:  
Limited participation of small-scale processors  
Potential for price manipulation and collusive behavior  
Reduced market efficiency and innovation  
The need for policies that encourage entry, support small processors, and improve access to finance and  
technology  
The CR₄ results indicate a tight oligopoly in Kano State (74.1%), while Kaduna (99.3%) and Nasarawa (99.9%)  
exhibit highly concentrated, near-monopolistic market structures, suggesting that tamarind processing in these  
states is dominated by a few large firms with significant market power.  
Integrated Interpretation of Market Concentration Using CR₄ and HHI  
The market structure of tamarind processing across Kano, Kaduna, and Nasarawa States was jointly assessed  
using the Concentration Ratio (CR₄) and the Herfindahl–Hirschman Index (HHI) in order to provide a robust  
evaluation of market concentration and competitiveness.  
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In Kano State, the CR₄ value of 74.1% indicates a tight oligopolistic market structure, where the four largest  
firms dominate a substantial share of the market. This finding is consistent with the HHI results, which also  
reflect a high level of concentration, confirming that market activities are controlled by a few relatively large  
processors, although smaller firms still maintain some presence.  
In contrast, Kaduna State exhibits an exceptionally high CR₄ of 99.3%, implying that nearly the entire market is  
controlled by the top four firms. Similarly, Nasarawa State, with a CR₄ value of 99.9%, demonstrates an extreme  
level of market concentration, where virtually all market share is held by the four largest firms.  
Overall Implication  
The combined evidence from CR₄ and HHI  
clearly indicates that while Kano State operates under a tight oligopoly, the tamarind processing markets in  
Kaduna and Nasarawa States are highly concentrated and weakly competitive  
Kano State  
The market structure of tamarind processing in Kano State is characterized by an HHI value of 0.0022862 and a  
CR₄ of 74.1%, indicating a high but comparatively lower level of concentration relative to Kaduna and Nasarawa  
States. The concentration ratio result shows that the four largest processors control nearly three-quarters of the  
total market, which is indicative of a tight oligopolistic market structure.  
The HHI value for Kano State, which is substantially higher than those recorded for Kaduna and Nasarawa,  
suggests a greater dispersion of market shares among firms and a more active competitive environment. This  
reflects the presence of a larger number of firms with relatively meaningful market shares, reducing the degree  
of dominance exercised by the leading processors. While the top firms remain influential, smaller processors in  
Kano appear to have a more significant role in market participation compared to their counterparts in the other  
states. The combined interpretation of CR₄ and HHI therefore indicates that tamarind processing in Kano State  
operates under a tight oligopoly with moderate competitive pressure. Unlike Kaduna and Nasarawa, where  
market control is almost absolute among the top firms, Kano exhibits relatively stronger competition, though  
still far from perfect competition.  
Comparative Insight  
In comparison with Kaduna and Nasarawa States, Kano State displays a less concentrated and more competitive  
market structure. The lower CR₄ and higher HHI values suggest that while a few firms dominate, market power  
is less extreme and more widely distributed, allowing for some degree of rivalry and entry opportunities.  
The CR₄ and HHI results for Kano State reveal a tight oligopolistic market structure with relatively stronger  
competitive conditions compared to Kaduna and Nasarawa States, where market concentration is substantially  
higher.  
Kaduna state  
The market structure of tamarind processing in Kaduna State is characterized by an HHI value of 0.0006102  
alongside a CR₄ of 99.3%, indicating a market with extreme dominance by a few firms. The concentration ratio  
result shows that the four largest processors collectively control almost the entire market, reflecting a highly  
concentrated market structure approaching near monopoly. This suggests substantial market power, limited  
competitive rivalry, and strong barriers to entry for smaller or potential processors.  
The HHI value, though numerically low, provides additional insight when interpreted alongside the CR₄. The  
relatively higher HHI for Kaduna compared with Nasarawa indicates greater inequality in market share  
distribution among firms, implying that dominant firms in Kaduna hold comparatively larger individual market  
shares. This suggests a market structure where dominant processors exert stronger control, while smaller firms  
operate at the margins with limited influence on market outcomes.  
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The joint interpretation of both indices therefore indicates that tamarind processing in Kaduna State is dominated  
by a small group of firms, with competition largely confined to a weak competitive fringe. While numerous  
smaller processors may exist, their cumulative market share is negligible, limiting their ability to challenge  
dominant firms or influence pricing and output decisions.  
Comparative Insight  
Compared with Nasarawa State, Kaduna exhibits a slightly less extreme but still highly concentrated structure,  
as reflected by its marginally lower CR₄ and higher HHI. This suggests that although both markets are near-  
monopolistic, market power in Kaduna is more unevenly distributed among the leading firms, reinforcing their  
dominance.  
The combined CR₄ and HHI results indicate that tamarind processing in Kaduna State operates under a highly  
concentrated, near-monopolistic market structure, with a few dominant firms exerting significant control over  
market activities while smaller processors remain largely marginalized.  
Nasarawa State  
The results for Nasarawa State reveal an apparently contrasting outcome between the two concentration  
measures, with an HHI value of 0.0001246 and a CR₄ of 99.9%. The concentration ratio (CR₄) indicates an  
extremely high level of market concentration, suggesting that the four largest tamarind processing firms jointly  
control virtually the entire market. This outcome implies a near-monopolistic or dominant oligopolistic market  
structure, characterized by substantial market power, limited competition, and high barriers to entry for smaller  
processors.  
In contrast, the very low HHI value suggests a low degree of overall concentration when market shares of all  
firms are considered. This apparent inconsistency can be attributed to the large number of firms operating at  
very small and relatively similar market shares beyond the dominant firms, which reduces the HHI despite the  
overwhelming dominance of the top four firms. Unlike CR₄, which focuses solely on the largest firms, HHI is  
sensitive to the distribution of market shares across the entire industry.  
Taken together, the joint interpretation of both indices indicates that while market control in Nasarawa State is  
heavily concentrated among a few dominant firms (as reflected by CR₄), the presence of numerous marginal  
processors with very small market shares dilutes the HHI value. This structure reflects a market where  
competitive fringe firms coexist with dominant processors, but exert little influence on pricing and output  
decisions  
4. Conclusion and Recommendations  
The study shows that tamarind processing is highly competitive across the study area, while marketing shows  
varying degrees of concentration,  
Tamarind processing is highly competitive and atomistic across Kano, Kaduna, and Nasarawa.  
Tamarind marketing varies in concentration, with Kano moderately concentrated, while Kaduna and  
Nasarawa are highly competitive.  
Fragmentation across the value chain limits economies of scale and hampers profitability.  
Despite the high level of competition, market efficiency is constrained by limited capital, inadequate  
processing/marketing infrastructure, and weak market integration.  
RECOMMENDATIONS  
Policy efforts should focus on strengthening value addition, cooperative formation, financing access, and  
improved market linkages.  
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Promote Cooperative Formation:  
Encouraging processors and marketers to form cooperatives can enhance bargaining power, market access, and  
access to credit.  
Strengthen Value Addition:  
Government and NGOs should support investment in modern processing technologies to improve scale and  
quality.  
Enhance Market Linkages:  
Connecting small processors to larger buyers, exporters, and industrial users can expand market opportunities.  
Improve Access to Finance:  
Tailored credit schemes for micro- and small-scale agro-processors should be developed.  
Capacity-Building Programs:  
Training in quality control, packaging, and market intelligence can enhance competitiveness.  
REFERENCES  
1. Adebayo, S., Johnson, T., & Musa, A. (2020). Market dynamics and competitiveness in Nigeria’s agro-  
processing sector. Journal of Rural Economics, 12(2), 44–57.  
2. Abdulsalam, T., & Ibrahim, M. (2021). Trade flows and industrial linkages in northern Nigeria. African  
Economic Review, 9(1), 78–91.  
3. Olajide, O., & Akinbode, S. (2021). Structural constraints in small-scale agribusiness markets. Nigerian  
Journal of Agricultural Economics, 15(3), 112–129.  
4. Ume, C., Okoro, P., & Nwafor, L. (2020). Market concentration and performance in Nigerian informal  
agro-processing clusters. International Journal of Agribusiness Studies, 4(1), 23–35.  
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