ABSTRACT
This study was designed to determine the integration of rice
markets in Enugu state.
Factors considered include: socio-economic characteristics,
existing market structure and
channels, integration of rice markets, structural factors
that affect the integration of rice
markets and the problems affecting rice traders in the
state. Forty wholesalers and forty
retailers were selected for the study. Primary data and
secondary data were collected and
analyzed using descriptive statistics, co-integration
analysis and market integration
function. The results showed that majority of the rice
traders were between 30 and 49
years with low educational status and marketing experience
ranging from 6 to 10 years.
Unit Root Test showed that the variables were stationary at
first differencing and were
integrated of the order zero, 1(0). Rice markets in the
study area were integrated but the
integration level was low.
The Error Correction Model had a coefficient of -0.0061872
which was significant at 1% level and was negative. The Market Integration
Function had R2 (Coefficient of Determination) of 0.78 showing that the
independent variables explained about 78% of the variations in the prices of rice
in the rural and urban rice markets. Transportation cost, toll fee, processing
cost and storage cost significantly affected the level of market integration.
The greatest problems encountered by the rice
traders were inadequate finance, (100%), high transportation
cost/bad roads and poor
quality of local rice compared to foreign rice. To improve
the level of market integration;
transportation, processing, storage, communication and
credits facilities should be provided.