ABSTRACT

The study was titled "Analysis of the Demand on Palm Oil in Ikwuano Local Government Area of Abia State. The research was embarked upon because of the lack of information on the demand of palm oil in the study area as well as the inherent woes of food marketing in the country. The major objectives were to examine factors that influence monthly demand expenditure on palm oil, measure the own price, cross price and income elasticity of palm oil as well as investigate the problems encountered by consumers of palm oil. The research was carried out in Ikwuano Local Government Area where 80 respondents were sampled and data collected with the use of questionnaires. Descriptive statistic tools, elasticity indicators as well as OLS regression technique were used to analyze the data. The respondents were found to be youthful with a mean age of 37 and household size of 3.94. They were also fairly literate and mean monthly income was N47,643.75. The result of the multiple regression analysis with double log as lead equation showed that the significant determinants of monthly demand expenditure on palm oil were price of substitute, monthly income, household size and level of education. The combined effect of all the variables explained 81.5% of the variations in the monthly demand expenditure on palm oil. The F-value was 51.96 and significant at l.0% risk level. The results of the analysis also showed that the own price, cross price and income elasticity of palm oil were 0.02, 1 .3 and 0.2 respectively. Based on the findings, it was recommended that efforts should be made to improve the quality of palm oil and it should also be properly packaged.