ANALYSIS OF FOOD-GRAIN STORAGE COST AS A FACTOR FOR SEASONAL PRICE VARIATION IN TWO STATES OF NORTH-WEST NIGERIA

The study analyzed grain storage cost as a factor in explaining seasonal price variation in two states (Kaduna and Katsina) of North-West Nigeria. The food grain markets considered were maize, rice, cowpea and soybeans. The study used both primary and secondary data. The primary data were collected by means of structured questionnaire and focus group discussion to elicit information on grain storage cost, cost of the grains, transportation and other handling costs. The secondary data covered monthly prices of food grains for 96 months (2007-2014). Six markets known for food grains (Giwa, Ikara, Pambeguwa, Funtua, Dandume and Danja) were purposively selected from the two states. Data were analyzed using temporal price model. The study revealed that seasonal price increase exceeded cost of storage for rice (54 out of 56 instances), cowpea (54 out of 56 instances) and soybean (47 out of 56 instances) which provided the opportunity for marketers to make above normal profit. The study recommended that agencies involved in policy formulation should formulate and implement price policy that will curtain unnecessary fluctuations in the price of food grains in Nigeria. There is the need for adoption of value chain system in food grain production so that a platform will be created for all the actors/stakeholders to discuss their problems and reduce price fluctuations in food grain marketing.