A SURVEY OF FUEL HIKE AND ITS IMPLICATIONS ON FOOD PRODUCTION AND SUPPLY IN NIGERIA

A SURVEY OF FUEL HIKE AND ITS IMPLICATIONS ON FOOD PRODUCTION AND SUPPLY IN NIGERIA

BACKGROUND OF THE STUDY

A historical examination of the Nigerian economy and its expansion reveals farming as the primary economic sector and the source of foreign exchange. Agriculture accounted for more than 80% of export profits and salaries in the 1960s, but over time, it contributed for around 65 percent of economic growth.

Agriculture contributed 34 percent of GDP in 1970 and 50 percent of GDP in 2003 (Daramola, 2004). Agriculture currently accounts for 41 percent of the actual economy, while crude oil accounts for 13 percent. Agriculture contributed around 50% of GDP in 1970 and 34% in 2003 (http://www.datallytics.com/). Daramola (2004) defines formalized formalized formalized formalized formalized formalized formalized formalized formal Currently, agriculture accounts for 41% of real industries, while crude oil accounts for 13%. Despite the fact that agriculture is no longer the primary contributor to Nigeria's GDP and the primary source of foreign exchange revenue, the oil industry as a whole has experienced phenomenal growth.

Agriculture also predominates in terms of jobs and ties to the rest of the economy, as Abayomi points out (1992). Agriculture is the most important industry for the great majority of Nigerians, employing two-thirds of the workforce and accounting for one-third of GDP 2002 (Agro-Ind) (http://www.datallytics.com/). The growth of Nigeria's oil sector in the early 1970s caused significant structural adjustments in the economy. In response to the oil boom, government expenditure has increased, promoting a variety of other economic activities such as infrastructure construction, the establishment of new institutions, the expansion of existing institutions, and the importation of consumer goods. These advancements have aided the naira's appreciation (Dutch disease), but there has been no commensurate rise in commercial agricultural commodities (Kwanashie et al., 1998; J. Olusi and M. A. Olagunju, 2005; A.T. Edun, 2012). Human and animal factors drive the majority of the energy need for agricultural output. The usage of petroleum products in agricultural production has been documented. The use of motorized water and diesel-powered tractors for agricultural mechanized activities demonstrates this modest but significant advantage over human and animal power (Sambo,2005). Meanwhile, a robust and productive agriculture sector will allow a country to feed its growing population, create jobs, trade, and supply raw materials to businesses. Agriculture has a multiplier effect on the socioeconomic and industrial fabric of any country due to its multipurpose existence.

STATEMENT OF PROBLEM

Nigeria is one of the countries where the price of its indigenous oil has risen since the 1970s (Adenikinju, 2012). This is because, in addition to its three main refineries, Nigeria still imports petroleum products to fulfill domestic demand. The downstream crisis in Nigeria's petroleum sector was thus a major issue for the majority of residents. This is because the country's constant rise in gasoline costs was caused not just by bunker vandalism, oil spills, and the behavior of certain vendors, but also by refinery inefficiencies. This has an impact on the country's economy due to continual fuel supply constraints, which lead to environmental and economic difficulties.

The finding of crude oil has had both a good and negative impact on Nigeria's agricultural production. On the negative side, this may be seen in the inhabitants of neighboring communities when petroleum wells are exploited. Any of these communities is also subjected to environmental devastation, resulting in a lack of agricultural production, mostly for sustenance. It also has an impact on other social and economic factors. As a result, the purpose of this study is to critically examine the impact of fuel price increases on food production and supply.

OBJECTIVES OF THE STUDY

The following are the primary objectives

1. To investigate the causes in the hike of fuel prices in Nigeria

2. To investigate if the causes in the hike of fuel prices affect agriculture and food production in Nigeria

3. To investigate how much it has affected the economy of the nation

RESEARCH QUESTIONS

1. What are the causes in the hike of fuel price in Nigeria ?

2. Does these causes in the hike of fuel price affect agriculture and food production in Nigeria ?

3. How much of an effect has it been to the economy of the nation ?

SIGNIFICANCE OF THE STUDY

This study will be of great significance to the government as the navigate ways on how to curb the menace of the hike in fuel prices.this study will also serve as a reference material to student and researchers who may want to carry out further research on this study

SCOPE OF THE STUDY

This study will focus on the implication of fuel hike in food production and supply in Nigeria and the intending harm it will do in the future.the resident of Lagos state will be the sample respondent to this study

LIMITATION OF THE STUDY

The major limitation the researcher encountered while carrying out this research work were the issues of finance,unavailability of materials and time factor to combine both research work and academic work.

DEFINITION OF TERMS

FUEL HIKE: This is a sudden or large increase in the price,rates and quantity of fuel

FOOD PRODUCTION: This is a process of preparing food by converting raw materials into finished products in the home or food processing industries

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