Thesis Abstract

Food is any nourishing substance that is eaten, drunk, or otherwise taken into the body to sustain life, provide energy, promote growth, etc. It is an indispensible perquisite for the survival of mankind and its economic activities including food production. For food security to exist at the national, regional and local levels, food must be available accessible and properly utilized. It is a basic necessity of life. Food is regarded as the basic means of sustenance, and an adequate food intake in terms of quantity and quality, is a key, for healthy and productive life (FAO, 2005). It is perhaps the most important commodity linking rural producers and urban consumers (Rengasamy et al. 2003). Food accounts for a substantial part of the typical Nigerian household budget. Various foods serve as important vehicles for taking nutrients into the body and bringing about a healthy state, hence the need for taken, there classes, of essential nutrients, which must be combined in appropriate proportion to ensure an adequate food intake. These include carbohydrates, proteins, fats and oil, vitamins and minerals (Omonona, Agoi and Adetokunbo, 2007). The need for food is topmost in the hierarchy of needs as it is essential for healthy living. Thus, achievement of food security is important in any given country. Africa with its vast land area covering 3 billion ha has 1.3 billion ha of agricultural land out of which only 252 million ha (19.36%) is arable (FAO, 2011). Africa is the center of origin and also a major producer of several cereals like sorghum, pearl millet, finger millet, teff, African rice and maize. Maize has overtaken these traditional cereals. In Africa, it is grown over an area of 34.08 million ha producing 70.08 million tons (FAO, 2015). Maize is a major staple crop in diverse agro-ecological zones and farming systems, and consumed by people with varying food preferences and socio-economic backgrounds. Of the 22 countries in the world where maize forms the highest percentage of calorie intake in the national diet, are in Africa. Maize accounts for almost The final report of the 1996 World Food Summit states that food security exists when all people, at all times, have physical, social and economic access to sufficient, safe and nutritious food that meets their dietary needs and food preferences for an active healthy life. It is a condition related to the supply of food, and individuals’ access to it. A farming household is therefore, adjudged food secure when the trio of food availability, food accessibility and food affordability is guaranteed in the required quantity and quality (World Bank, 2001). At the 1974 World Food Conference the term “food security” was defined with emphasis on supply. Food security, they said, is the “availability at times of adequate world food supplies of basic foodstuffs to sustain a steady expansion of food consumption and to offset fluctuations in production and prices”. It is also a situation that exists when all the people, at all times, have physical, social and economic access to sufficient, safe and nutritious food that meets their dietary food preferences for an active and healthy life (UNFAO, 2001). The WHO states that there are three pillars that determine food security food availability, food access, and food use. The FAO adds a fourth pillar the stability of the first three dimension of food security over time. In 2009, the world summit on Food Security stated that the “four pillars of food security are availability, access, utilization and stability. Food availability means that enough safe and nutritious food either domestically produced or imported from the international market. Food availability does not ensure food accessibility. For food to be accessible individuals or families must have sufficient purchasing power or ability to acquire quality food at all times the utilization demands sufficient quality and quantity intake (Omonona et. al, 2007). These elements availability, accessibility and utilization in a larger context, embrace the supply, demand and adequacy of food at all times. Food insecurity, is a situation of “limited or uncertain availability of nutritionally adequate and safe foods or limited or uncertain ability to acquire acceptable foods in socially acceptable ways”, according to the United States Department of Agriculture (USDA). Mohammed (2003) noted that food insecurity exists when there is physical unavailability of food, lack of social and economic access to adequate food/or inadequate food utilization. Food insecure households are households whose food intake falls below their minimum calorie (energy) requirements, and those who exhibit physical symptoms caused by nutrient deficiencies resulting from inadequate diets. The dimensions of food security make it clear that the concept of food problem is a complex one with many dimensions. At one level, the concern is with national food security, which is the ability of countries to produce or increase sufficient food all the year to meet their requirement for both private and public distribution. At another level, the concern is more with the problem of malnutrition which could also affect labor. Agriculture is an important tool and vehicle for reducing the effect of household food insecurity, unemployment and poverty which are major in Nigeria (Moore, 2000). Agricultural productivity is linked to food security as higher agricultural productivity would translate to larger food supplies, lower food prices, higher farm income and higher purchasing power for other basic necessities for the attainment of household food security (Wunderlich and Norwood, 2006). To have sustainable development in agriculture there is need to make efficient use of basic production factors, which include land, labor and capital (Bervidova, 2001). Labor is one of the most important inputs in agricultural production. Labor is a service (person-years per year) and includes all human time-using activities, including what is sometimes labeled separately as labor and management. Labor services are perishable and hence cannot be moved to another period in time for use; workers, on the other hand, are durable, potentially working for many years as well as being geographically mobile. Labor plays a central and crucial role in agricultural production, particularly under small scale peasant production system. Human labor activates other production factors and transforms other farm inputs into the required outputs. It is about the only source of labor available to small-holder farmers in Nigeria. The smallholder farmers contribute the largest proportion (about 85%) of total domestic agricultural output in their area. Thus, the hope of continuing supply of food need of ever growing population anchors very auspiciously on human labor. How it is measured and valued is critical for establishing the cost of producing agricultural commodities and accurately portraying labor’s relative share of the total cost of production. Farm labor includes all hired labor/contract which may be subdivided into; seasonal labor and task-contracted casual labor, exchange, and unpaid or family labor used in agricultural production. However, .the contribution of exchange labor to family’s overall labor input is low (less than 10%). Some studies (Echebiri & Mbanasor, 2003; King 1972) confirm that farm labor supplied by humans on the farm is not homogenous and job content differ. These studies found that in general, men performed heavy farm operations such as land preparation, staking and harvesting with women and children performing lighter operations such as planting, fertilizer application and weeding. Ajibefun et. al., (2000) noted that hired labor contributes 88.0% [1] of the total use on farms thus emphasizing its importance in agricultural activities. Other types of labor that could be found employed are family labor and exchange labor. Researchers on farm labor supply have observed the total supply of labor depends on factors such as the size of the population, its age composition and certain institutional factors (Hardwick, 1994). 1.2 STATEMENT OF PROBLEM Nigeria is the most populous country in Africa with an estimate of 150 million people (Nigerian Population Census, 2006). Approximately 68% 0f this population consists of women and children with over 70% residing and securing their lively in the rural areas (Maziya-Dixon et al., 2004). Agriculture in Nigeria is of notable relevance in the country’s economic development and growth. It contributes more than 48% of the total annual GDP, employs about 68% of the labor force, account for the over 70% of the non-oil exports and provided over 80% the food need of the country (Adegboye, 2004). Despite these notable roles, food insecurity RANKS top most among the developmental challenges facing Nigeria (Babatunde et al 2007). Food insecurity has been on the increase in most rural areas in Nigeria (Oni et al., 2011). In Nigeria food insecurity has risen from about 18% in 1986 to about 41% in 2004 (Sanusi et al 2006). In fact, food security is considered a measure of poverty in many societies since it reduces access to food (World Bank, 1991; Nord et al., 2000; Adeniyi and Ojo, 2013). Therefore, food security of households will improve if poverty is reduced (Philip et al., 2009; Aewuyi and Hayatu, 2011). The recent increase of food prices call for serious attention, due to challenges and crises facing the globe is worsening food and other Agricultural products crisis period unheard of in the last 30 years and the potential of leading to scarcity. That is why this vital issue has taken the most attention among world leaders, thereby increasing and agitating the concern for the world’s ability to feed its 6.8 billion people, to prevent world-wide instability as reported in most countries like Nigeria (Food and Agricultural Organization, 2013). As a result, various international organizations and individual countries embarked on aggressive food security movement to find a concrete solution to the situation in order to make food affordable to all. The Food Security assessment in 2005 proves that about 750 million people were food unsecured in almost 70 low-income countries. Furthermore, Asia and other Commonwealth States experienced a 30% decline in the number of those that are hungry. In Latin American and Caribbean countries has varied a little over time, but there has been a noticeable trend across the area as a wholly. In spite of the strong growth in food production, Sub-Saharan Africa is the only region where hunger has increase in the last ten years. The challenge today is that high food prices has led to the increase in food insecurity and widespread food crisis in many developing countries in which Nigeria is not excluded. However, poor people in developing countries spend about 50-80% of their monthly income on food meet consumers need. Any increase in food prices will reduce food consumption and increase hunger. In Nigeria however, the prices of rice, corn and wheat recorded a high roof-tops recently (FAO, 2013). Generally, this overall food crisis has been attributed to a number of factors including climate change, population growth, poor storage facilities, increased demand for bio-fuels, failure to improve crop yield, high oil prices resulting to increased input loss for producers and traders. The structural problems like under-investment in agriculture and dominance in supply chain of food and agricultural policies sky rocket prices of food. However, Studies have revealed that agricultural-based livelihood in rural Nigeria has a higher level of poverty than other occupational groups. Rural agriculture is limited to local variations in weather conditions, and thus expected variations in income levels and thus access to food respectively (Omonona, 2009). Additionally, Hired and Use labor is not only applicable where family labor is insufficient. The much desired transition from small-scale farming to commercial level production by expansion of production resources definitely requires outsourcing for additional labor. Blanc et- al. (2008) opines that the proportion of use labor in total farm labor use in many developing countries has continued to increase over time which makes this present study relevant. Achieving food security is still a challenge due to the global approach being employed instead of formulating and applying solutions based on specific locations with an understanding of the social system and livelihood system (FAO, 2003). Hence the study intends to assess labor use and food security among rural farming household in Oyo state, Nigeria. In essence, the study attempts to provide answers to the following questions What are the socioeconomic characteristics of maize farmers in the study area? What are different labor sources available to respondent in the study area? How do maize farmers use the available labor? What is the food security status of the respondent? What are the determinants of household food security of the respondent? 1.3 OBJECTIVES OF THE STUDY The general objective of this study is to assess labor use and food security in the study area. The specific objectives are to discuss the socioeconomic characteristics of the maize farmers in the study area, identify the different labor sources available to respondents in the study area, examine labor allocation among the maize farmers, know the food security status of the respondent, determine the factors influencing household`s food security of the farmers. 1.4 ANALYSIS OF OBJECTIVES The table 1.1 below presents the analysis of each of the objectives in terms of data requirement, sources of data, method of data collection and method of data analysis.

Thesis Overview

1.1BACKGROUND OF THE STUDY

Starting in 2010-2011, the government of Nigeria after years of being neglect began to reform the agricultural sector to focus the sector, the government implemented a new strategy called “The Agricultural Transformation Agenda ATA” this policy is aim at helping Nigeria’s refocus attention on agriculture. growth and development in any economy ,especially the agricultural sector is an activity that cannot be effectively carried out without involving insurance, Thus insurance plays a vital role in the development of the agricultural sector Nigeria.

Agricultural insurance is normally undertaken as a market based activity by private or state sector insurance companies, often with the support measures from government .the government through various policies and intervention has been very active in the promotion of agricultural insurance in Nigeria. This is buttressed by the fact that agriculture has been a predominant occupation which has over the years provided economic development, it accounts for about 40-50% of the GDP.As far as agricultural insurance is concern the place of agricultural insurance cannot be over emphasised .one cannot discuss agricultural insurance before first identifying what insurance means.

Udensi (2002) insurance is a system for transferring the responsibility of paying for losses from one party to another. Insurance by conventional definition is the equitable transfer of a loss from one entity to another in exchange for a premium for a guarantee and quantifiable small loss to prevent a large and possible devastating loss. One of the cardinal program of the Obasanjo led administration when it came on board in 1999 was the radical development of agriculture in all its ratification ,not only as a veritable way of bringing about the all round development of the Nigeria state but also as propitious channel of systematically diversifying the mono-cultural tendencies of the Nigeria economy and this was achieved through the establishment of Nigeria agricultural insurance cooperation (NAIC) through the decree no 37 in 1993. Section 3 of the decree of the decree made a provision for the establishment of the Nigeria agricultural scheme which the agricultural insurance cooperation is an executing body. The categorical imperatives of the scheme are to provide financial support to farmers where losses to crops and livestock arise from natural hazards, it is to include provision of credit by financial institution as the insurance cover is an added collateral .Again it helps to promote agricultural production by giving farmers confidence to accept new as well as modern innovations and inputs.

From the beginning, the scheme provided cover to only two crops items and two livestock item namely cattle and poultry and some commercial business like farm building, machinery and equipment. the cover has since been extended to cover more items namely 21 crops items, 9 items of livestock and 12 types of commercial business. It equally design specific cover to suit peculiar customer needs. For example it has designed and implemented a special type of cover for agriculture or produce marketing loan as follows, fire and special perils cover for property used as collateral security for marketing loans .the scheme operates a mandatory cover which applies to the following:

1. All agricultural loans from banks taken for all items insurable by NAIC
2. All agricultural and agro-related projects which are assisted, supported or fully funded from public funds.

• All direct and on-lending loans taken by all tiers of government for disbursement to farmers and agricultural projects for implementation.

1. All forms of loans for agricultural marketing purpose by all banks and non banks lending agencies
2. All direct on lending and investment loans disbursed by the Nigerian agricultural cooperation and rural development bank (NACRDB).

The value of the risk taken by NAIC since inception as at the end of 2003 was 80 billion, which were adequately covered by local and international reinsurance treaties .the vast scope of the cover ,the huge volume of risk taken up by NAIC and the 50% subsidy given by the Nigerian government makes the Nigerian agricultural scheme recognized by many countries and the food and agricultural organisation(FAO) of the united nations as a major contributions towards self-sufficiency in food production and as a scheme to be placed in other parts of the world.

1.2 STATEMENT OF THE PROBLEM

The efficiency of agricultural insurance in reducing farmer losses has not being in doubt but the constant to its growth. the agricultural sector is a very important aspect of the economy apart from its economic importance, it brings about food security for local consumption during the course of this study the following problems were identified.

One of the major problems of agriculture in Nigeria is the wide variety of agricultural practices in Nigeria many at time the national agricultural insurance cooperation do not provide cover for some of the practices thereby leading to inadequate funding of the agricultural sector by the government, due to lack of proper funding many farmers are not able to go into commercial agricultural and therefore cannot reach their full potentials in agriculture.

However there is a death of professionally qualified manpower in the agricultural insurance sector who are specialist in qualifying and underwriting agricultural risk. Government often times import large number of tractors without a single service station for repairs and replacement of worm out parts thereby creating a problem of unserviceable machinery and farmers resort to the old way of farming .

Farmers most at times are unaware of the functions and merits of involving in the agricultural insurance scheme which tends to lead to ignorance on the part of the farmer.

 

1.3 OBJECTIVES OF THE STUDY

This study seeks to evaluate the role of government policies in promoting agricultural insurance in Nigeria other specific objectives includes:

1. Analysis of the types of agricultural policy available in the promotion of agricultural insurance in Nigeria.
2. To examine the effect of inadequate statistical data on effective rating of agricultural risk in Nigeria

• To examine some of the challenges facing Nigeria insurance agricultural cooperation.

1. To examine the effect of government policies in agriculture in Nigeria

 

1.4 RESEARCH QUESTIONS

1. TO what extent has government policies promoted agricultural insurance in Nigeria?
2. Are there agricultural policies available in the promotion of agricultural insurance in Nigeria?

• Does government policies have any positive impart to the development of agricultural insurance in Nigeria?

1. How has agricultural insurance cooperation contributed to the promotion of agricultural insurance in Nigeria?

1.5 HYPOTHESIS FORMULATION

The assumption by the researcher about the effect of government policy in promoting agricultural insurance will be tested to enable the researcher draw possible conclusion .this study will be tested using Null hypothesis (Ho) and Alternative(H1).

      HYOTHESIS I

Ho: There is no significant relationship between government policy and agricultural insurance policy.

H1: There is a significant relationship between government policy and agricultural insurance policy.

HYOTHESIS II

Ho: There are no agricultural policies available for the promotion of agricultural insurance in Nigeria.

H1: there are agricultural policies available for the promotion of agricultural insurance in Nigeria.

 

 

      HYOTHESIS III

Ho: Government policies has not constitute a positive impart to the promotion of agricultural insurance in Nigeria.

H1: Government policies has constitute a positive impart to the promotion of agricultural insurance in Nigeria.

1.6 SCOPE OF THE STUDY

Agricultural insurance is designed to provide cover for financial losses incurred due to reduction in expected output .this research work is meant to cover the contribution of government to the promotion of agricultural insurance practice in Nigeria .in the event of carrying out this study various related work were review from publication to annual reports, magazines and text books. This study goes further to examine the different types of agricultural policies available to farmers.

1.7 SIGINIFICANCE OF THE STUDY

This study will attempt to determine an appraisal of the role of government policies in promoting agricultural insurance in Nigeria. the significance of this research study is to highlight the effectiveness of government policies in the operation of agricultural insurance in Nigeria. This study is significant in that it will elevate government policies that are beneficial to agriculture there by promoting the development of agricultural insurance practice in Nigeria.

This research work will assist intending researchers in updating existing research work serve as a source of reference for further research.

For clarity, it was important to define some terms used in the study report.

• Agriculture: is the science or practice of farming including the cultivation of soil , growing of crops and rearing of animals to provide food.
• Agricultural insurance: is a financial tool to transfer production risk associated with farming to the third party via payment of premium that reflect the true long term cost to the insurer assuming those risk.
• Government : A group of people that governs a community or unit, it sets and administer public policy and exercise, executive, political and sovereign power through customs, institutions and laws within a state.
• Insurance: may be defined as a systematic plan for protection against economic losses.
• Insurer: An insurance company or other organization that provides insurance.
• Premium: The payment or one of several payment, required to establish and keep a life insurance policy in full effect.
• Promotion: That part of marketing that is concerned with selecting the appropriate technique for selling a product to a consumer.
• Policy: is an evidence of a contract (section 15 subsection (1) insurance act 2004).