ABSTRACT

This study is an econometric analysis of the export supply of Nigeria's major agricultural exports — palm oil, palm kernel, cocoa, cotton and groundnut. One of the important contributions of agriculture to Nigeria's economic development is the supply of foreign exchange through the export of major agriculttrrai commodities. Studies have shown that the export of agricultural commodities has declined both in volume and number of export commodities. This study is designed to provide the basis for reversing this decline. The objectives of the study were to: determine the factors affecting the export supply of these agricultural commodities, and the elasticity of response of export supply of these agricultural commodities with respect to domestic producer price, average world price, real exchange rate and time trend; compare the elasticity of response of export supply of these commodities with respect to domestic producer price, average world price, real exchange rate and time trend and finally to make recommendations based on the findings. Secondary data were used for the study. The study covered the period 1970 — 2000. Data were analyzed using regression analysis. The results showed that export supply increased as real exchange rate increased for palm kernel and groundnut. Export supply increased as domestic producer price increased for Cotton, Cocoa, and Palm oil. It also

•showed that export supply increased as rainfall increased for Palm oil, Palm kernel and Cocoa while the export supply decreased as time trend decreased for Cocoa, Cotton, Palm oil and Groundnut, and as average world price decreased for Cocoa. The results also indicated that palm oil export was more responsive to domestic producer price than Cocoa and Cotton. Cotton export responded more to time trend than 'Groundnut, Palm oil and Cocoa. Also, Groundnut export was more responsive to real exchange rate than Palm kernel export and Cocoa export was responsive to average world price. Cocoa export was inelastic with respect, to average world price. With respect to domestic producer price, Cocoa export was inelastic, Palm oil export supply was elastic and the supply elasticity of cotton export was almost unity. With respect to real exchange rate, Groundnut export was elastic while Palm kernel export was inelastic. Cocoa, Cotton, Palm oil and Groundnut export supply were inelastic with respect to time trend. The provision of irrigation facilities and guaranteed minimum producer prices will lead to an increase in output and consequently in exports.