MARKET INTEGRATION AND PRICE MOVEMENT OF PEPPER AND TOMATO IN NORTH-CENTRAL, NIGERIA

Market integration is imperative to improve efficiency of production and marketing. The study examined market integration and price movement of pepper, sweet pepper and tomato (fresh and dried) between rural producing areas and urban markets in Kwara State, North Central Nigeria. Monthly retail price data from 2013-2017 obtained from Kwara Agricultural Development Project (KWARA ADP) were analysed using the Augmented Dickey-Fuller test, Cointegration analysis, Granger causality test, and Index of market connection. Results showed that prices of fresh pepper, dried pepper, and fresh tomato were stationary at level in both rural and urban markets. Fresh sweet pepper (rural markets) and dried sweet pepper (urban markets) were also stationary at level form. Rural and Urban prices for fresh/dried pepper, sweet pepper and tomato were cointegrated. Granger causality was bidirectional for fresh pepper prices, but unidirectional from rural to urban markets for fresh sweet pepper, fresh tomato and dried tomato prices. No causality was found for dried pepper and dried sweet pepper prices. The index of market connection showed high short-term market integration for fresh pepper, fresh tomato and dried tomato, but low integration for dried pepper, fresh sweet pepper and dried sweet pepper. The study recommends maintaining and strengthening market linkages through information dissemination and provision of adequate infrastructure.