ANALYZING PRICE TRANSMISSION IN THE NIGERIAN CATTLE MARKET

Abstract

The study analysed price transmission in the Nigerian cattle market. Time series price data, for ten states (Borno, Cross River, Edo, Kano, Nassarawa, Osun, Oyo, Plateau, Yobe and Zamfara) for the years, 2002-2017 were used for the analysis. The summarised result on Threshold Vector Error Correction model showed that positive and negative deviations for eight states (Borno, Cross River, Edo, Nassarawa, Osun, Plateau, Yobe and Zamfara) exceeded their respective threshold values. Also all the values of the above threshold values are not equal to the below threshold values,indicating the presence of asymmetric transmission. The presence of asymmetric transmission showed price changes along the chain (from farmer/marketer to consumer) was greater than the market costs of handling cattle and agents will be in a greater position to implement price changes before transmission takes place. This indicates strong asymmetric price transmission since price changes moved from bottom of the chain to the top. There is need to improve on the market information system in the country so that information will flow to all the markets.