Time Series Trend Analysis on Nigerian Food Prices

Time Series Trend Analysis on Nigerian Food Prices

 

TITLE PAGE                                                         

Certification

Dedication

Acknowledgement

Table of Content

List of Tables

ABSTRACT

CHAPTER ONE: INTRODUCTION

1.1    Background of the study

1.2    Statement of the problem

1.3    Objective of the study

1.4    Research question

1.5    Significance of the study

1.6    Scope of the study

1.7 Limitation of the study

1.8 Definition of terms

CHAPTER TWO: REVIEW OF LITERATURE

2.1    Conceptual framework’

2.2    Theoretical Framework

CHAPTER THREE: RESEARCH METHODOLOGY

3.1    Introduction

3.2    Research Design

3.3    Population of the study

3.4    Sample size determination

3.5    Sample size selection technique and procedure

3.6    Research Instrument and Administration

3.7    Method of data collection

3.8    Method of data analysis

3.9    Validity of the Study

3.10  Reliability of the study

3.11  Ethical Consideration

CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS

4.1    Data Presentation

4.2    Research Hypothesis

CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATION

5.1    Summary

5.2    Conclusion

5.3    Recommendation

References

Appendix

 

 

Abstract

This study was on time series trend analysis on Nigerian food prices. Two objectives were raised which included; To provide the trend of prices of Nigerian foods and to compare and forecast the prices of some selected food items varies due to location in Nigeria. A total of 77 responses were received and validated from the enrolled participants where all respondents were drawn from Nigeria Bureau of Statistics (NBS). Hypothesis was tested using Chi-Square statistical tool (SPSS).

 

Chapter one

Introduction

1.1Background of the study

Food crops, especially grains, have always been an important staple food in Nigeria. The consumption cuts across cultures, ages and regions. They are an important part of the diet of an average Nigerian judging from the high proportion consumed. However, in the past few years, there had been consistent increase in the prices of food crops thereby making it to be beyond the reach of low income earners. Okuneye ( 2001) observed that the rising costs of food prices have roots in policies and programmes of past governments. In particular, after the Structural Adjustment Programme (SAP) period not much attention was paid to agriculture and food production. As a result, food prices have continued to rise. The resultant effects of these are the problems of malnutrition, household food insecurity and restricted access to nutritious and sufficient food, culminating in greater effect of poverty on many Nigerians. Since 2003, interna tional prices of a wide range of commodities have surged upward in a dramatic fashion. In many cases more than doubling within a few years and in some cases a few months.

 

A surge in the price of food is of special concern to the world’s poor because many impoverished people depend upon food production for their livelihood, and virtually all poor people spend large portions of their household income on food. Therefore, sharply rising prices offer few means of substitution and adjustment especially for the urban poor, and there are justifiable concerns that millions of people may be plunged into poverty by this crisis (Headey and Fan, 2008). Dorosh (2013) further pointed out that international price for major food commodities such as rice, maize and wheat escalated two record times in three years.

 

The price of major cereals surged in the second half of 2007 and the first half of 2008 to reach record levels in nominal US dollar terms, before falling again in the second half of 2008. Prices surged again in mid-2010 to June 2011 by 43% in real terms and in the second half of 2011 the index stabilized but at a level about 10% higher than the previous value in 2008 (Conceição et al., 2011). In Nigeria, at the level of high food prices, according to FEWSNET (2008) “most urban and rural markets are exhibiting historically high prices since 2007 and continued to worsen in April 2008. Some analyst in Nigeria believed that the deregulation of the downstream sector of the petroleum resources and the poor state of rural road networks have manifested into high cost of transporting produce between surplus and deficit areas. The increased cost of transportation meant that poor resource farmers have to depend on middlemen to transport food crops from the producing to the consumption areas. This gives middlemen the opportunity to exploit farmers’ imperfect knowledge of the market to offer low prices for farm produce (Oladapo and Momoh, 2007). According to Agiri (2000), there is no efficient pricing and marketing system for agricultural products in Nigeria. The lack of reliable market outlets forces the farmers to sell their produce at whatever price they can get at the farm gate. Therefore, fluctuation in the market prices of food is a common phenomenon in the Nigerian markets. This is because in periods of glut, prices are forced down since farmers are compelled to sell their produce at low prices to avoid deterioration and loss of produce. On the other hand, in seasons of scarcity, prices of food shoot up. Thus, prices of agricultural produce vary at different times of the season depending on storage costs and some other factors which are location specific. In view of its direct impact on the standard of living of most Nigerians, fluctuations in the prices of agricultural products have become of great concern to economists and policy makers. Therefore, this paper examines the trend in prices of some selected food crops in the rural and urban markets as well as determines the variations in their prices over time

Statement of the problem

High Cost of food prices: The monthly inflation rates released by the Nigerian Bureau of Statistics measures the percentage at which the prices of products rise or fall. When the data shows a reduction, therefore, it means there was an increase in the price of that product but at a reduced percentage. If there is a reduction in price, it means there was deflation. (Sahara Reporters, 2019). The high agricultural prices are attributable to a combination of factors. A distinction may be made between the effects of supply, demand, policy and other factors.

Seasonal foods: food prices may also vary based on the times of year when the harvest or the flavour of a given type of food is at its peak. For this study, yam, onions and tomatoes are a bit surplus during the raining season because it’s the harvest season while beans are in storage and it’s the planting season.

 

Scarcity: Shortage of foods may happen when not enough food is produced, such as when crops fail due to drought, pests, or too much moisture. But the problem can also result from the uneven distribution of natural resource endowment for a country, and by human institutions, such as government and public policies. Other factors that can bring about scarcity are cost of production, time and efficiency.

Objective of the study

The objectives of the study are;

1. To provide the trend of prices of Nigerian foods.
2. To compare and forecast the prices of some selected food items varies due to location in Nigeria

Research hypotheses

The research is guided by the following hypotheses

HO1: there is no trend of prices of Nigerian foods.

H1: there is trend of prices of Nigerian foods.

HO2: some food items price does not vary due to location

H2 some food items price varies due to location

Significance of the study

The findings of this study will redound to the benefit of the society considering the fact that food is very important in human’s life. The lower the price of food the more it is made available and accessible to people which will thereby bring improvement to their standard of living. This research will also be beneficial to the future researcher because they can get some information needed in their research and some of their questions could possibly be answered by this work

Scope and limitation of the study

This work is limited to two Geo-political zones in Nigeria, the North West and the North Central and four different types of food items are considered, viz: Yam, Brown Beans, tomatoes and Onions, which are grown mostly from these two Northern geo-political zones. The study will also consider only four states of each of the zones for two consecutive years – 2017 and 2018. The study will also forecast the future prices of these food items via the comparison of the previous years. The study will expose the reasons why food demand varies in those various geo-political zones in Nigeria which could be based on good climate, cost of farming/transportation and population. The study will be done by analysing the raw Data produced by the Nigeria Bureau of Statistics (NBS) using the Box Jenkins Arima model in Time Series and Trend Analysis

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