ఫిషరీస్ & పశువుల ఉత్పత్తి

నైరూప్య

Price Fluctuations, Linkages and Causality in the Nigerian Beef Market

Bobola OM, Mafimisebi TE and Ikuemonisan ES

Since beef accounts for 71% of meat consumption in Nigeria, efficient functioning of the beef market network is very important in Nigeria’s development. This study tested for the degree of integration in the beef market using secondary data from twelve states of Nigeria. The analytical techniques used included descriptive statistics, Augmented Dickey Fuller (ADF), Johansen Co-integration and Granger Causality models. Empirical results showed that retail price growth rates were highest in 2002. Growth was highest in Benue Market in 2002 (99.7%), Sokoto Market in 2009 (95.4%) and Imo Market in 2002 (54.9%). Growth rates were generally stable in 2001 except in Kwara Market. The lowest growth rates were recorded in Benue Market (-35.1%) and Imo Market (-14.5%) in 2003. Average growth rates were highest in Borno Market (17.4%), Sokoto Market (16.0%) and Bauchi Market (15.6%) while it was least in Lagos Market (11.3%). Generally, growth rate was higher in the producing areas (15.3%) than in the consuming areas (13.6%). The markets with the highest monthly retail prices were Imo, Rivers, Lagos and Enugu and were all located in southern Nigeria, a sink region for cattle. The ADF test showed all price series were non-stationary at their levels but stationary after first-differencing. Pair-wise market integration model indicated that prices were co-integrated in 72.7% of beef market locations indicating a high degree of marketing efficiency in the beef market. Prices were tied together in the long run in seven out of every 10 market locations in spite of short run divergences. The result of pair-wise Granger causality showed that 80 market pairs had evidence of price causation. Sixty two (62) market links of the 80 exhibited bi-directional Granger causality while 18 market pairs showed uni-directional Granger causality. The results of Granger causality test did not reveal that there are no clear price leaders in the beef market network. Despite the fairly high level of beef market linkage, there is need for all stakeholders to continue to effectively perform their roles so that there can be perfect linkage that will allow economic benefits derivable from this scenario of strong pricing contacts to be fully realized and sustained.