Problems Of Co-operative Societies In The Marketing Of Agricultural Products

Project and Seminar Material for Agricultural Economics and Extension

Problems Of Co-operative Societies In The Marketing Of Agricultural Products


Abstract


This study was designed to determine the problems of co-operative societies in the marketing of agricultural products in Ushongo Local Government Area of Benue State. A structured interview schedule was used to collect data from a random sample of 115 respondents drawn from five of the eleven Council Wards in the Local Government Area. It was found that respondents’ socio-economic characteristics had no significant influence on farmers’ participation in cooperatives. The study showed further that cooperatives were able to regulate only a small proportion of the volume of produce farmers took to the market. However, three quarters (74.8%) of respondents believed that cooperatives determined prices of produce. Some of the constraints facing cooperatives identified included the large number of middlemen (75.5), inadequate storage (67.0%) and low literacy of members (67.8). It is concluded that cooperatives would better impact farmers if identified constraints are addressed by both governmental and non-governmental stakeholders.

 


Table of Content


Chapter One

1.0 Introduction

  • 1.1 Background of the Study
  • 1.2 Statement of Problem
  • 1.3 Research Objectives
  • 1.4 Research Questions
  • 1.5 Research Hypothesis
  • 1.6 Significance of the Study
  • 1.7 Definition of Terms
  • 1.8 Organization of the Study

Chapter Two

2.0 Literature Review

  • 2.1 Conceptual Framework
  • 2.2 Concept of Food Security
  • 2.3 Food Availability, Stability of Food Supplies, Food Access and Food Utilization
  • 2.4 Challenges and Prospects of Food Security in Nigeria
  • 2.5 The African Food Crises and the Global Response
  • 2.6 Agricultural Cooperatives: Their Nature and Role in Food Security

Chapter Three

3.0 Research Methodology

  • 3.1 Design of the Study
  • 3.2 Area of the Study
  • 3.3 Sample and Sampling Technique
  • 3.4 Instrument for Data Collection
  • 3.5 Validation and Reliability of the Instrument
  • 3.6 Method of Data Collection
  • 3.7 Method of Data Analysis

Chapter Four

4.0 Results and Discussion

  • 4.1 Results
  • 4.2 Discussion

Chapter Five

5.0 Summary, Conclusion and Recommendations

  • 5.1 Summary
  • 5.2 Conclusion
  • 5.3 Recommendations
  • References
  • Appendix

Chapter One


1.0 Introduction

1.1 Background of the Study

Access to market for agricultural produce is a critical consideration for every farmer especially the resourcepoor farmers. As much as 40 percent of agricultural produce is wasted in Nigeria due to poor access to storage facilities and markets. As most farmers do not have the wherewithal to store and transport their products to the market, they are compelled to rely on exploitative middlemen for the marketing of their agricultural produce. In the end, their losses are multiplied: whereas part of their harvests is lost due to poor storage, what is left is also lost through unfavorable prices imposed by middlemen (Saddique, 2015; Oguoma, Nkwocha and Ibeawuchi, 2010). In the final analysis, the farmer’s income, nutritional and food security and general welfare is negatively impacted. Thus, being a farmer in Nigeria is associated with being poor, and for most farmers the only exit from poverty lies in belonging to a cooperative.

A cooperative is a group of people with common interests, organized to promote the social welfare of its members. It offers various social and economic solutions to most rural problems. The synergized effect of group activities and influence affords benefits that may not be individually feasible for most of the rural poor (Mure et al. 2012). In a similar vein, Akinwumi (1989) asserts that Cooperatives are economic enterprises that are founded by and belong entirely to the members. These enterprises are created in order to render the best possible services at the lowest possible cost to their members. Cooperatives stand over two legs in order to be solid and sustained. Cooperative action leads to the creation of people’s organizations that bring together individuals with common problems and aspirations who as individuals cannot meet certain goals effectively, (Barham, 2006).

Cooperative societies are very popular in Nigeria. Onuoha (2002) in his study of cooperative history in Nigeria stated that there are traditional and modern cooperative societies. The modern cooperative societies started in the country as a result of the Nigerian cooperative society law enacted in 1935 following the report submitted by C. F. Strickland in 1934 to the then British colonial administration on the possibility of introducing cooperatives into Nigeria.

According to Nweza (1997), the Nigerian government introduced cooperatives in the wake of the world depression of 1930 to solve its marketing and credit problems. At the time, cocoa farmers were the victims of exploitation of foreign middlemen that cheated in the area of price and quality of their products. The then Nigerian government sent Mr. G.F. Strictland, an Ex-Army Major to India to undertake a three-month course in cooperatives which he did and submitted his report in 1934 on the need to introduce cooperatives. The government accepted the reports and appointed Major E.F.G. Hang as Registrar and sent him to India for a similar course.

Cooperative societies in Nigeria like their counterparts all over the world are formed to meet people’s mutual needs. Cooperatives are considered useful mechanisms to manage risks for members in agriculture. Through cooperatives, farmers could pool their limited resources together to improve agricultural output and this will enhance socio-economic activities in the rural areas (Ebonyi and Jimoh, 2002).


1.2 Statement of Problem

Food production in Nigeria is not keeping pace with population growth. This has resulted in the upward trend in the price of food stuff. Thus, creating a wide gap between the demand and supply of food. According to Ajayi (2008), the resulting effect of this imbalance between demand for and supply of food is malnutrition, poverty and deteriorating living conditions. Hence, the need to improve Nigeria agriculture. Over the years Nigeria has been having a teething problem feeding it teeming population all year round and this is partly because it has not been able to adopt an improved farming technique. According to Idachaba (1995), the Nigeria agriculture depends overwhelmingly on low productivity resources, land of progressively declining fertility, unskilled farm labour, the hoe matchet, low yielding seed variety and planting material. Low yielding agricultural and traditional farming practices, poor yield and high cost of food prices.

High production cost are compounded by high processing and transportation cost on account of the primitive state of rural infrastructures especially rural roads, heavy post-harvest losses both in storage and transportation reduce available marketable and marketed surpluses and result in high food prices, especially in the urban areas (ldachaba, 1995). Limited finance and poverty of the Nigeria farmers have also been identified as factors militating against food production. As noted by Obinyan (2000), their holdings are small, most often less than two hectares and are characterized by low productivity. This leads to low income and low capital investment. Consequently, one of the possible ways of redressing these constraints is to mobilize the desperate small holder farmer for economy of scale and agricultural cooperative is a veritable platform for this exercise.

As price-takers, however, farmers are faced with the challenges of lack of ready markets to sell their produce. In view of the proven utility of social capital in building the capacity of vulnerable individuals to accomplish hitherto unattainable objectives, the study was designed to determine the problems of co-operative societies in the marketing of agricultural products in Ushongo Local Government Area of Benue State.


1.3 Research Objectives

The purpose of this study is to examine the effect of classroom size in effective teaching and learning of Business Education in Junior Secondary Schools. Specifically, the objectives include:

  1. To determine the extent to which cooperatives regulate the volume of produce farmers take to market
  2. To determine the role of Cooperative Societies in marketing Agricultural products
  3. To identify the problems and challenges of Cooperative Societies in marketing of agricultural produce in the study area

1.4 Research Questions

This project is designed to tackle the following reach questions;

  1. What is the extent to which cooperatives regulate the volume of produce farmers take to market?
  2. What is the role of Cooperative Societies in marketing Agricultural products?
  3. What are the problems and challenges of Cooperative Societies in marketing of agricultural produce in the study area?

1.5 Research Hypothesis

The following hypotheses were formulated to guide the study the hypothesis is to be tested at 0.5 alpha levels.

  • HO1: Cooperative Societies do not play a significant role in the marketing agricultural products
  • HA1: Cooperative Societies play a significant role in the marketing agricultural products

1.6 Significance of the Study

The agricultural cooperatives have been there over the years to play this role of drastic structural change in agriculture towards achieving food security and also the socio-economic upliftment of the farmers. Findings of this study will be useful to community leaders, cooperative societies, agricultural stakeholders and the academia. The problems and challenges of Cooperative Societies in marketing of agricultural produce identified in this study will be considered alongside strategies to address them effectively. Also, the findings of this study will provide baseline data and inform the empirical review of future researchers in related areas of study.


1.7 Definition of Terms

Cooperative Societies:

Are autonomous associations of persons united voluntarily to meet their common economic, social, and cultural needs by forming an enterprise owned and controlled by a group of people. They are crucial in helping to make up for the excesses of society.

Marketing:

The action or business of promoting and selling products or services, including market research and advertising.

Agricultural Products:

Includes agricultural crops, livestock such as poultry and poultry products, dairy and dairy products, fishery and fishery products, forestry and forestry products, horticulture and horticultural products.


1.8 Organization of the Study

This study is divided into five chapters. The first chapter is the introduction which contains the background, research problems and objectives. The second chapter is the literature review and the third chapter is the research methodology. In the fourth chapter, the researcher analyses the data and discusses the results. The fifth chapter is the last chapter which presents the summary, conclusion and recommendations.


Chapter Five


5.0 Summary, Conclusion and Recommendations

5.1 Summary

The study was carried out to determine the problems of co-operative societies in the marketing of agricultural products in Ushongo Local Government Area of Benue State. The quantity of produce sold by individuals ranged between 100kg – 18,000kg with the mean (2588.70) and standard deviation of 3025.325. This result shows that cooperatives regulate 20% of the total produce farmers take to the market. A majority of the farmers believed that cooperatives determined prices of agricultural produce (74.8%); this role is viewed to be instrumental because it gives farmers confidence in cooperative activities in regulating the prices of agricultural produce. Similarly, provision of ready market (72%) and provision of strong bargaining power (71.3%) was also a major role played by cooperatives. The result in Table 3 shows that the major challenge of cooperatives in the study area was the large number of middlemen (75.5%) whose activities are exploitative to farmers. Other challenges faced by cooperatives include lack of proper management by leaders (73%).This suggests that most of the leaders in cooperatives are corrupt and hence farmers see no need of marketing their agricultural produce via cooperatives.


5.2 Conclusion

The study demonstrated the potentials of cooperatives to move farmers from mere price-takers to a position of significant control over the market. However, several constraints have limited the impact of cooperatives on the ability of cooperatives to facilitate competitive prices for farmers.


5.3 Recommendations

Cooperatives will fare better if these problems and challenges are addressed. For instance, the provision of transport and storage infrastructure would reduce their operational costs. Investments in literacy programs and other capacity building efforts would also improve the quality of leadership and enhance service delivery.


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