Price analysis of paddy rice in Monday-market, Borno state, Nigeria (2009 to 2021)

Abstract

This study analysed the price of paddy rice in Monday-market in Borno State. Rice is an important staple crop in Borno State and indeed, the whole of Nigeria. However, significant rice price volatility is witnessed across the region which led to the creation of risks and uncertainties among producers, processors and marketers of rice. Consequently, the objectives of this study were to estimate the trends in market prices of rice; examine the seasonal variations/ fluctuations; and forecast the future prices of rice in the study area. Secondary data of average monthly price per 100 kg bag of paddy rice for 156 months (from January, 2009 to December, 2021) was collected from the National Agricultural Extension and Research Liaison Services (NAERLS). The study employed the use of the Multiplicative model, Centred Moving Average (CMA), Seasonality Index (SI), Grand Seasonality Index (GSI), Gross Storage Return (GSR) and Autoregressive Integrated Moving Average (ARIMA). The result showed that the price series has a positive linear trend with R² value of 0.91. Furthermore, the GSI peaks in August (105.3) and October prior to largest harvest period. Price declines in November through December and January. The GSI become lowest in March (94.7) when all harvests enter market. The gross storage margin, which is the percentage increase in price from March to August, was 11.19% per season. The study forecasted that price of rice will keep on increasing throughout the period under review. It is concluded that rice prices exhibit a fluctuation pattern (seasonality) within a year period; it peaks in August and declines in January. Therefore, whoever is interested in storing rice should buy it from December to February and sell it off from July to September for maximum profit, all things being equal.