Analysis of Price Transmission of Fresh Tomato and Pineapple in the Rural and Urban Markets of Akwa Ibom Sate, Nigeria
American Journal of Agriculture and Forestry
Volume 2, Issue 3, May 2014, Pages: 66-78
Received: Mar. 28, 2014;
Accepted: Apr. 18, 2014;
Published: Apr. 30, 2014
Views 3524 Downloads 265
Sunday Brownson Akpan, Department of Agricultural Economics and Extension, Akwa Ibom State University, Nigeria
Ini-Mfon Vincent Patrick, Department of Agricultural Economics and Extension, Akwa Ibom State University, Nigeria
Glory Emmanuel Edet, Department of Agricultural Economics and Extension, University of Uyo, Akwa Ibom State, Nigeria
Daniel Etim John, Department of Agricultural Economics and Extension, University of Uyo, Akwa Ibom State, Nigeria
The study investigated the dynamics of price transmission and market integration of fresh tomato and pineapple in the rural and urban markets of Akwa Ibom State, Nigeria. Average monthly prices (measured in naira per kilogram) of fresh tomato and pineapple in the rural and urban markets were used in the analysis. The data was obtained from the quarterly publications of the Akwa Ibom State Agricultural Development Programme (AKADEP). The data covered the period from January 2005 to September 2013. The trend analysis showed that, prices of fresh tomato and pineapple in the rural and urban markets have positive significant relationships with time and positive exponential growth rate. The Pearson correlation coefficient of each of the respective pair of rural and urban price of fresh tomato and pineapple revealed significant positive and symmetric relationships. The bivariate Granger causality test revealed bi-directional relationships between the rural and urban price of fresh tomato and pineapple in the State. The co-integration test revealed the presence of co-integration between the rural and urban price of fresh tomato and pineapple. The coefficients of market integration in the rural and urban price equation display varied degrees of long run market integration. The results of the error correction model (ECM) confirmed the existence of the short run market integration between the rural and urban prices of fresh tomato and pineapple in the study area. The urban price of fresh tomato adjusted faster to the stable state in the long run than its respective rural price. Also the rural price of pineapple adjusted faster to a stable state in the long run than its respective urban price. The index of market connection for fresh tomato and pineapple supported the existence of the short run market integration between the rural and urban markets. Based on the findings, it is recommended that, the Akwa Ibom State government should continue to provide marketing infrastructures in the rural areas to improve the symmetric nature of information among fresh tomato and pineapple markets in the state. Effort should also be channeled by all stake holders such as governments, trade unions and other organizations to reduce excessive externality costs associated with the marketing of fresh tomato and pineapple in the state. The government of Akwa Ibom State should established market information centers and awareness programmes on mass media to facilitate efficient information flow among fresh tomato and pineapple producers and consumers in the state.
Sunday Brownson Akpan,
Ini-Mfon Vincent Patrick,
Glory Emmanuel Edet,
Daniel Etim John,
Analysis of Price Transmission of Fresh Tomato and Pineapple in the Rural and Urban Markets of Akwa Ibom Sate, Nigeria, American Journal of Agriculture and Forestry.
Vol. 2, No. 3,
2014, pp. 66-78.
Adebusuyi, B. S. (2004). Stabilization of commodity market of interest to Africa: Paper presented at the workshop on constraints to growth in sub-Saharan Africa, held in Pretoria South Africa.
Adenegan, K. O. and I. B. (2011). Adeoye. Price Analysis of Tomato in Rural and Urban Retail Markets of Oyo State. International Journal of Agricultural Economics & Rural Development. Volume 4 (2): Pp 90 – 96.
Adeoye, I. B, Dontsop Nguezet P. M, Badmus M. A and Amao I. O. (2011). Price Transmission and Market Integration of Banana and Plantain in Oyo state, Nigeria. ARPN Journal of Agricultural and Biological Science; Vol. 6, No. 5, Pp 18-24.
Akpan, S. B, Inimfon V. P, Samuel J. U. (2014). Analysis of Monthly Price Transmission of Local and Foreign Rice in Rural and Urban Markets in Akwa Ibom State, Nigeria (2005 to 2013). International Journal of Agriculture and Forestry; 4(1): 6-18.
Akpan, S. B. (2007). Relative Price Variability and Inflation: A case study of Grain subsector in Nigeria. Unpublished Master Degree Thesis; University of Uyo.
Akwa Ibom State Agricultural Development Programme (AKADEP), quarterly physical progress reports of various issues (from January 2005 to June 2013).
Amusa, A. M. (1997).Trend Analysis of Agricultural Food Prices in Nigeria (1985-1995) (A Case Study of Ibadan). Unpublished M. Sc Project, Department of Agricultural Economics, University of Ibadan, Ibadan, Nigeria.
Baumöhl, E., and Tomáš Výrost (2010). Stock Market Integration: Granger Causality Testing with Respect to Non-synchronous Trading Effects. Finance aúvěr Czech Journal of Economics and Finance, 60, no. 5, Pp 414-425.
Chirwa, E. W. (199). “Food Marketing Reforms and Integration of Maize and Rice Markets in Malawi. University of Malawi”. Working Paper, No. WC/05/99, 1999.
Crawford, P. B, Obarzanek E., Morrison J & Sabry Z. I. (1994). Comparative advantage of 3-day food records over 24 recall and 5-day food frequency validated by observation of 9-and 10-year girls. J Am Diet Assoc 94 (6): 626-630.
Famine Early Warning Systems Network (FEWSNET) (2008). Nigeria Food Security Outlook March to September 2008.
Gilbert, C. (1999). Commodity risk management for developing countries: paper prepared for the third meeting of the international task force (ITF) held in Geneva 23-24 June 1999.
Gonzalez-Rivera, G. & S. M. (2001). The Extent, Pattern and Degree of Market Integration: A Multivariate Approach for the Brazilian Rice Market. American Journal of Agriculture Economics, 2001; 83(3), 576-92.
Goodwin, B. K. & T. C. Schroeder. (1991). “Cointegration tests and spatial price linkages in regional cattle markets.” American Journal of Agricultur al Economics, 1991; 73(2): 452-464.
Goodwin, B. K. (2005). Spatial and Vertical Price Transmission in Meat Markets. A Paper prepared for workshop on Market Integration and Vertical and Spatial Price Transmission in Agricultural Markets, University of Kentucky, April 21, 2005.
Granger, C. W. J. (1969). Investigating causal relations by econometric models and Cross-spectral methods. Econometrica 37, 424-438.
Hendry, D. F. (1986). ‘The Role of Prediction in Eval uating Econometric Models’, Proceedings of the Royal Society of London, 1986; 407, 25–34.
Mushtaq K, Abbas F, & Ghafoor A. (2006). Testing the Law of One Price Rice Market Integration in Punjab, Pakistan. Pakistan Journal of Agricultural Science; 43(3): 213 – 216.
National Population Council (NPC) of Nigeria, 2006 Population Census Data.
Ohen, S. B., S.O. Abang & I. C. Idiong. (2007). Price Transmission and Market Integration: Vertical and Horizontal Price Linkages for Live Catfish in Nigeria. Journal of Agriculture & Social Sciences; Vol. 3, No. 1, 17–20.
Ojiako, I. A., I. A., Chuma E, Godwin N. A & N. M. Nkang. (2012). Spatial Integration and Price Transmission in Selected Cassava Products’ Markets in Nigeria: A Case of Lafun. World Applied Sciences Journal; 18 (9): 1209-1219.
Okoh, R. N & Egbon P. C. (2005). The Integration of Nigeria’s Rural and Urban Foodstuffs Markets. AERC Research Paper 151, Africa Economic Research Consortium, Nairobi, 2005.
Oladapo, M. O., Momoh S, Yusuf S, & Awoyinka Y. (2007). Marketing Margin and Spatial Pricing Efficiency of Pineapple in Nigeria. Asian Journal of Marketing; 1(1), 14-22.
Odozi, J. C., and Bolarin T. O., (2012). Governance options for price instability: A review of the food grain commodity in Nigeria. Journal of Development and Agricultural Economics; Vol. 4(4), pp. 93-100.
Polaski, S. (2008). Rising Food Prices, Poverty and Doha Round. Carnegie Endowment for International Peace, 2008.
Quebedeaux, B. and Bliss, F. A. (1988). Horticulture and human health. Contributions of fruits and vegetables. Proc. 1st Intl. Symp. Hort. and Human Health. Prentice Hall, Englewood, NJ.
Quebedeaux, B. and Eisa, H. M. (1990). Horticulture and human health. Contributions of fruits and vegetables. Proc. 2nd Intl. symp. Hort. and Human Health. HortScience 25:1473-1532.
Sexton, R. J., C. L. Kling, H. F. Carman. (1991).“Market integration, efficiency of arbitrage, and imperfect competition: methodology and application to U.S. celery.” American Journal of Agricultural Economics; 73(3):568-580.
Van Duyn, M. A & Pivonka E. (2000). Overview of the health benefits of fruit and vegetable consumption for the dietetics professional. J Am Diet Assoc 99 (10): 1241.
Wargovich, M. J., (2000). Anticancer properties of fruits and vegetables. HortScience 35:573-575.