AN ANALYSIS OF DEMAND, SUPPLY AND ELASTICITIES OF 
SEED POTATO IN MAJOR PRODUCING AREAS IN NIGERIA
Lenka, D.M., Dung, E.A....
Objectives
Identify and describe socio‐economic characteristics of the seed potato 
producers and seed potato traders
Esti...
Introduction
• Potato is an important tuber crop both as a food and cash crop in potato
producing areas of Nigeria
• Niger...
Methodology
Study area:
Bokkos, B/ladi, Mangu, Jos South, Riyom, Jos North  local government 
areas
Sampling Method
• A to...
Results and discussion
Table 1: Distribution of farmers according to socioeconomic characteristics
Variables Frequency Percentage
Age of producer...
Table 2: Demand functions for seed potato in major potato producing areas
Variables Est. Coefficients Std Error T‐Value
Co...
Table 3: Estimated elasticities of explanatory variables on demand 
for seed potato
Variable Elasticity
Age (yrs) ‐0.03
Ed...
Table 4: Determinants of supply of seed potato in Major potato
producing areas
** significant @ 0.05 probability level: **...
Table 5: Elasticities of supply of seed potato in Nigeria
Variables Elasticities
Gender 0.20
Educational level  0.001
Inco...
Conclusion
The study indicated that seed potato farmers in the major potato 
producing areas are predominantly middle aged...
Policy implications
This results call for
Policies that will provide legal protection and support on pricing to 
protect p...
Sess05 1 lenka, d.m., dung e.a and asumugha, g.n. – an analysis of demand, supply and elasticities seed potato in major pr...
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Sess05 1 lenka, d.m., dung e.a and asumugha, g.n. – an analysis of demand, supply and elasticities seed potato in major producing areas in nigeria

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Sess05 1 lenka, d.m., dung e.a and asumugha, g.n. – an analysis of demand, supply and elasticities seed potato in major producing areas in nigeria

  1. 1. AN ANALYSIS OF DEMAND, SUPPLY AND ELASTICITIES OF  SEED POTATO IN MAJOR PRODUCING AREAS IN NIGERIA Lenka, D.M., Dung, E.A. and Asumugha, G.N.
  2. 2. Objectives Identify and describe socio‐economic characteristics of the seed potato  producers and seed potato traders Estimate and analyse the demand and supply functions for seed potato in  the major producing areas Examine the relative demand, supply elasticities and cross‐elasticities for  seed potato Make recommendations for increasing the demand and supply of seed  potato
  3. 3. Introduction • Potato is an important tuber crop both as a food and cash crop in potato producing areas of Nigeria • Nigeria is the fourth biggest producer of potato in Sub-Saharan Africa, with output of 840 000 tonnes in 2007 (Lutaladio, 2009) • Nigerian estimated area cultivated under potato was 266,000 hectares with an average yield of 3.27 tonnes/ha (FAO, Statistics 2008) • Nigeria has the lowest per capita potato consumption in Africa (3.27kg) (FAO, Statistics 2008) • Jos Plateau accounts for over 90% of potato production in Nigeria • lack of quality seed and high prices are the major factors affecting potato production • Factors such as labour, farm size, fertilizer, income, education, farming experiences of households etc influence the supply and demand for root and tuber crops • This study assessed the influence of socio-economic variables and prices of complementary and substitute products on the demand and supply of seed potato in major potato producing areas.
  4. 4. Methodology Study area: Bokkos, B/ladi, Mangu, Jos South, Riyom, Jos North  local government  areas Sampling Method • A total of 90 seed potato producers and 90 Traders were selected  using  multistage and random sampling techniques i.e.,  – From  6 local government areas, 3 districts were selected and 5 farmers each  were selected randomly from each village • Data collection and statistical tools • Primary data  were collected  on household socio‐economic  characteristics, input and output data  and prices of  complement  and substitute crops both on the demand and supply side. • Multiple regression model, descriptive statistics were used to  estimate the demand and supply functions. Elasticity of demand  and supply were derived from these estimates.
  5. 5. Results and discussion
  6. 6. Table 1: Distribution of farmers according to socioeconomic characteristics Variables Frequency Percentage Age of producer (yrs): 20‐39 40‐59 60‐79 22 53 15 24.4 58.9 16.7 Education (yrs): O‐6 7‐12 >12 31 46 15 34.4 51.1 14.5 Gender: Female: Male: 32 58 35.6 64.5 Disposable income (N): 100000‐300000  ($625‐1875) 301000‐700000  ($1875‐4375) >701000 (>$4375) 38 29 23 42.2 32.2 25.6 Farm size: 0.1‐2ha 2.1‐5ha >5ha 30 43 17 33,3 47.8 18.9 Experience (yrs): 1‐10yrs 11‐20yrs >20yrs 36 33 21 40 36.7 23.3
  7. 7. Table 2: Demand functions for seed potato in major potato producing areas Variables Est. Coefficients Std Error T‐Value Constant ‐29.29 20.59 ‐1.42 Age of household hd (yrs) 6.73 4.96 1.36 Educational level (yrs) 21.24 10.01 2.12** Income 0.2754 0.06 4.52*** Labour (availability) ‐34.67 27.49 ‐1.26 Farm size (ha) 7.6251 9.24 8.25*** Experience (yr) 17.7 57.5 0.31 cocoyam ‐0.97 1.05 ‐0.92 Sweet potato ‐0.637 0.650 ‐0.98 yam ‐0.313 0.523 ‐0.60 Price of seed potato (N) ‐10.25 4.29 ‐2.39** Fertilizer (kg) 266 59 4.51*** R2 92 F‐value 98.43*** ** significant @ 0.05 probability level: *** significant @ 0.01 probability level
  8. 8. Table 3: Estimated elasticities of explanatory variables on demand  for seed potato Variable Elasticity Age (yrs) ‐0.03 Education (yrs) 0.00 Income (N) 0.37 Labour (manday) ‐0.03 Farm size (ha) 0.00 Experience (yrs) 0.007 Cocoyam ‐0.01 Sweet potato ‐0.10 Yam ‐0.01 Price of seed potato (own elasticity) 0.08 Fertilizer (kg) 2.62
  9. 9. Table 4: Determinants of supply of seed potato in Major potato producing areas ** significant @ 0.05 probability level: *** significant @ 0.01 probability level Variables Est. Coefficients Std Error T‐value Constant 96.12 75.27 1.28 Gender ‐1.26 3.07 ‐0.41 Educational level  29.43 54.27 0.54 Income 0.0215 0.08 0.27 Household size 36.12 17.65 2.05** Price of seed potato ‐2.12 8.10 ‐0.26 cocoyam 2.20 1.57 1.40 Sweet potato 0.338 1.0 0.34 Yam ‐0.812 0.80 ‐1.01 Labour cost 258 44.6 0.565 Experience  17.28 8.51 2.03** R2 30.4 F‐Value 0.226
  10. 10. Table 5: Elasticities of supply of seed potato in Nigeria Variables Elasticities Gender 0.20 Educational level  0.001 Income 0.052 Household size 0.001 Price of seed potato ‐0.02 cocoyam 0.05 Sweet potato 0.01 Yam ‐0.02 Labour cost 0.18 Experience  0.001
  11. 11. Conclusion The study indicated that seed potato farmers in the major potato  producing areas are predominantly middle aged (40‐59 yrs) 51%, 47.8% and 40% had o’level certificate, farm size of 2.1‐3ha and  farming experience of at least 10 years respectively Relevant economic variables that positively and significantly influence the  demand for seed potato are farm size, fertilizer and income own price of the seed potato negatively and significantly influenced the  demand for seed potato and  The own price elasticity of demand for seed potato is inelastic implying  that increase in price of seed potato will bring in the long run less than  proportionate decrease in the demand for seed potato Relevant economic variables that positively and significantly influence the  supply of seed potato are household size and farming experience The elasticities of other variables were less than 1 (inelastic) implying that  in the long‐run percentage changes in these variables will bring less than  proportionate change in seed supply.
  12. 12. Policy implications This results call for Policies that will provide legal protection and support on pricing to  protect producers and traders against price exploitation Policies that will regulate farm labour practices and improve access  to  mechanized labour and also provide off‐season income to farmers Facilitate the production of  fertilizer by the private sector  and  control the  quality of fertilizers and other farm inputs Provide quality education to farmers to apply modern knowledge in  production and marketing Strengthening the modernization and use of indigenous knowledge  in potato production Seed inspection and certification policies

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