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AN ANALYSIS OF SOME AGRICULTURAL COMMODITY PRICES IN SELECTED MARKETS IN KANO STATE, NIGERIA.
ABSTRACT
The existence of markets are a necessity to cater for the farmer’s surplus production. This however is not enough on its own to adequately take care of the interests of the market participants. It is essential that produce must be sold at prices that would cover cost of production and leave a surplus to reward the farmer’s efforts. The performance of the markets is therefore equally very important. It is desired for produce to be sold at a price that would harmonise maximising the farmer’s profit and minimising the consumer’s cost(s). There are indications resulting from market imperfections of the existence of leadlag price relationship amongst markets in the country: Some markets were found to appreciably affect the price of a commodity in other markets. This can greatly distort the pricing efficiency of the marketing system, particularly the marketing of agricultural products. The major objective of this study was to study intra and inter commodity price relationships; to this effect, the prices of six (6) commodities were collected from five (5) markets in Kano State and then analysed using regression analysis. The results in general indicated that the mean significant effect of the prices of different commodities in the same market is about the same as the effect of the same commodity prices in other markets on the price of the commodity in an individual market and this effect is significantly very high. The mean significant effect of the prices of other commodities viii in the other markets on the price of a commodity in an individual market is however very low. This implies poor inter commodity market integration and is attributed to market imperfections in the area of study. Poor market information and transport bottlenecks led to poor distribution of goods which then results in poor market integration and leadlag price relationships among markets.
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