THE INFLUENCE OF AGRICULTURAL COOPERATIVES IN THE DEVELOPMENT OF FOOD PRODUCTION IN NIGERIA

THE INFLUENCE OF AGRICULTURAL COOPERATIVES IN THE DEVELOPMENT OF FOOD PRODUCTION IN NIGERIA

CHAPTER ONE

INTRODUCTION

1.1 Background to the Study

Agriculture accounts for about 20 percent of GDP, in the African sub-region (World Bank, 2005); two third of the people derive from livelihoods and 40 percent of exports commodities come from this sector (World Bank, 2000). Despite the importance of the agriculture sector, its performance over the last 30 years has been disappointing: agriculture and food production per capital in West Africa has stagnated in last ten years (FAO, 2005) yield of grain crops are less than half, those of other developing regions in Asia and South America. If Africa is to feed itself, lift its people out of poverty and attain a satisfactory level of sustainable growth, the poor in the performance of its agricultural sector must be addressed. It is the dominant sector in the rural areas of Nigeria as it provides less than 50% of the country’s cultivable agricultural land is under cultivation particularly because smallholder and farmers who use rudimentary production techniques cultivate most of this land with resultant low yields. The smallholder farmers are constrained by many problems including those of poor access to modern inputs and credit, poor infrastructure, inadequate access to markets, land and environmental degradation and inadequate research and extension services (Oluwatayo, et al 2008).

In an effort to overcome some of these issues, donor agencies and government have re-emphasized cooperative as a strategy to promote collective action to strengthen smallholder’s livelihoods by linking them to national and international markets. Cooperatives are defined as autonomous association of persons who unite voluntarily to meet their common economic and social needs aspiration, through a jointly owned and democratically controlled enterprise (International Cooperative Association’s, (ICA) 1995). Cooperatives are established by like-minded persons to purse mutually beneficial economic interest and they provide a unique tool for achieving one or more economic goals in an increasingly competitive global economy. These goals include achieving economic of size, improving bargaining power when dealing with other business, purchasing in bulk to achieve lower prices and obtaining product and services otherwise unavailable.

Develtere (1995), described cooperative as a medium through which services like provision of farm input, farm implements, farm mechanization, Agricultural loans, agricultural extension, members education, marketing of members farm produce and other economic activities and services are rendered to members. Cooperative can be multi-purpose or focused on area. An example of the latter is farmer’s cooperative provides smallholder farmers with economic of scale by facilitating cheaper and more efficient access to inputs, production technologies, market information and markets.

Today in an area where many people (especially small-holder farmers) feel powerless to change their lives, cooperative can serve as a strong, vibrant and viable economic alternative. They are based on the powerful idea that are formed together, a group of people can achieve goals that none of them can achieve alone. It has being considered as a third force, an alternative and countervailing power to both big business and big government (ICA, 1995)

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THE INFLUENCE OF AGRICULTURAL COOPERATIVES IN THE DEVELOPMENT OF FOOD PRODUCTION IN NIGERIA