CAUSAL RELATIONSHIP BETWEEN WORLD OIL PRICES AND AGRICULTURAL PRODUCTIVITY IN SELECTED STAPLE CROPS IN NIGERIA: 1980-2014

This study analyzed the direction of causality between world oil prices and agricultural productivity in selected staple crops in Nigeria. This study explored analysis based on the output and input quantities of the crop sub-sector, which is the dominant sub-sector of the agricultural sector in Nigeria. Secondary data was utilized which were sourced from secondary sources such as the Organization of Petroleum Exporting Countries (OPEC), National Bureau of Statistics (NBS) and Central Bank of Nigeria (CBN) annual statistical bulletin. The data were analyzed using the Granger causality (1969) approach. The result of the study showed that there is a unidirectional causality running from world oil price to agricultural productivity. In addition, the study showed that world oil price can be used to forecast the productivity of maize, rice, sorghum, millet, cassava, yam, groundnut, beans and soya beans. Rise in oil price no doubt results to rise in agricultural production resources which make production resources inaccessible to the resource-poor farmers. The consequence is decline in agricultural productivity. Hence it is necessary that provision should be made by government and other stake holders to cushion the effect of hike in price of production resources to the farmers so that agricultural production can continue unhindered.

Abstract licence: CC BY-NC-ND

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