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Analysis Of Supply Response And Price Risk On Rice Production In Nigeria

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  • Ayinde, Opeyemi Eyitayo
  • Bessler, David Arnold
  • Oni, Femi Emmanuel

Abstract

Nigeria, like most African countries, has engaged in agricultural liberalization since 1986 in the hope that reforms emphasizing price incentives will encourage producers to respond. Thus far, the reforms seem to have introduced greater uncertainty into the market given increasing rates of price volatility. This study amongst other things therefore seeks to determine and model the responsiveness of rice supply to price risk in Nigeria. Statistical information on domestic and imported quantities of rice was obtained for 41 years (1970 to 2011) from various sources, such as the Food and Agriculture Organization (FAO) database, Federal Ministry of Agriculture statistical bulletins, Central Bank of Nigeria statistical bulletins and National Bureau of Statistic (NBS). Data were analyzed using equilibrium output supply function, co-integration models, and vector autoregressive distributed lag model. Rice importation was statistically significant and changes in output were also responsive to changes in price. The results indicate that producers are more responsive not only to price and non-price factor but also to price risk and exchange rate. It is therefore imperative to reduce the effects of price risk as to increase the response of producer to supply by bridging the gap in production

Suggested Citation

  • Ayinde, Opeyemi Eyitayo & Bessler, David Arnold & Oni, Femi Emmanuel, 2017. "Analysis Of Supply Response And Price Risk On Rice Production In Nigeria," Journal of Agribusiness and Rural Development, University of Life Sciences, Poznan, Poland, vol. 43(1), March.
    • Handle: RePEc:ags:pojard:259669
    DOI: 10.22004/ag.econ.259669
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    1. Mosadegh Sedghy, Bahareh & Tamini, Lota Dabio & Lambert, Remy, 2018. "Effects of Price Insurance Programs on Supply Response: A Case Study of Corn Farmers in Quebec," MPRA Paper 93816, University Library of Munich, Germany, revised 30 Nov 2018.
    2. Muhammad Aamir, Shahzad, 2017. "Price Forecasting Model for Perishable Commodities: A Case of Tomatoes in Punjab, Pakistan," MPRA Paper 81531, University Library of Munich, Germany, revised 01 Aug 2017.

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