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Zeszyt 4 (46) 2017 , DOI: 10.17306/J.JARD.2017.00398

Toyin Benedict Ajibade, Opeyemi Eyitayo Ayinde, Tahirou Abdoulaye, Emmanuel Ada Ojoko

ANALYSIS OF THE IMPACT OF SELECTED ECONOMIC VARIABLES ON SORGHUM PRICES IN NIGERIA

Abstract:

Nigeria is the world’s leading producer of sorghum
intended for use as food grain. Likewise, there has been growing
industrial demand for sorghum in the livestock breeding
and brewery sectors. As sorghum prices have been on the increase,
it becomes pertinent to identify the determinants of
this development in order to nip the imminent food crisis in
the bud. This study relied on time series data spanning from
1970 to 2015 retrieved from FAOSTAT and World Bank databases.
Analytical methods employed include the unit root
test, cointegration test and error correction mechanism. The
diagnostic tests indicated the presence of autocorrelation
which was subsequently adjusted with the Cochrane-Orcutt
procedure. Subsequent tests indicated that variables fit well to
the model. As shown by the ADF unit root test, the modeled
variables were non-stationary but became stationary after first
differencing. At a significance level of 5%, the sorghum price
was determined by gross domestic product (GDP), annual
money supply, official exchange rate and crude oil price, both
in the long and short run, whereas the lagged price of sorghum
also had an effect on prices in the short run. The study recommends
that macroeconomic variables such as GDP, annual
money supply and official exchange rate be taken cognizance
of when planning the agricultural development in Nigeria.

Keywords: autocorrelation, Cochrane-Orcutt procedure, cereal, cointegration, error correction model, time series

PDF in in english Full text available in english in Adobe Acrobat format:
www.jard.edu.pl/vol46/issue4/art_69.pdf
http://dx.doi.org/10.17306/J.JARD.2017.00398
For citation:

MLA Ajibade, Toyin Benedict, et al. "ANALYSIS OF THE IMPACT OF SELECTED ECONOMIC VARIABLES ON SORGHUM PRICES IN NIGERIA." J. Agribus. Rural Dev. 46.4 (2017): 723-729.
APA Toyin Benedict Ajibade, Opeyemi Eyitayo Ayinde, Tahirou Abdoulaye, Emmanuel Ada Ojoko (2017). ANALYSIS OF THE IMPACT OF SELECTED ECONOMIC VARIABLES ON SORGHUM PRICES IN NIGERIA. J. Agribus. Rural Dev. 46 (4), 723-729
ISO 690 AJIBADE, Toyin Benedict, et al. ANALYSIS OF THE IMPACT OF SELECTED ECONOMIC VARIABLES ON SORGHUM PRICES IN NIGERIA. J. Agribus. Rural Dev., 2017, 46.4: 723-729.
Corresponding address:
PhD Toyin Benedict Ajibade, Department of Agricultural Economics and Farm Management, University of Ilorin, Nigeria PMB 1515, Ilorin, Nigeria,
Authors email:
badetoyin@yahoo.com, ajibade.tb@unilorin.edu.ng

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