Summary FINAL YEAR PROJECT AND RESEARCH ON AGRICULTURAL ENGINEERING FOR FINAL YEAR STUDENTS
4 views 0 purchase
Course
AGRICULTURAL ENGINEERING
Institution
AGRICULTURAL ENGINEERING
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Agriculture is still regarded as one of the mainstays of the Nigerian economy, before and after independence with the production of food for the vast teaming population. It contributes immensely to the production of raw materials which has tra...
FINAL YEAR PROJECT
AND RESEARCH ON AGRICULTURAL ENGINEERING
FOR FINAL YEAR STUDENTS.
1
, CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Agriculture is still regarded as one of the mainstays of the Nigerian
economy, before and after independence with the production of food for the
vast teaming population. It contributes immensely to the production of raw
materials which has translated into increased foreign exchange earnings,
better social life, and higher standard of living of people. Therefore, wise
nations all over the globe make agriculture a priority by developing and
exploiting this sector for the survival of the nation. This is done by
formulating policies by the government of different countries, this is in line
with the fact that agricultural financing to the national economy cannot be
overemphasized because of its relevance in stemming hunger and
assuring food security, reducing unemployment, solving balance of
payment problem and increasing GDP. (Inyang-Akpan, 2005).
The term agriculture is derived from the Latin word “Ager” (field) and
“cultural” (cultivation). This means field cultivation. This is not a complete
definition of agriculture since agriculture has to do with animal production.
Therefore, agriculture can be defined as the art and science of cultivating
the soil, producing livestock, preparing livestock feed, processing crops,
and livestock products for man, and the process of selling excess crops
and livestock. Agriculture may also mean just the production of crops,
rearing of animals, and general management of the soil.
Agriculture also involves the science of preparing the soil for the production
of crops and the rearing of animals for human use. It also embraces
various preparations and processing of plant and animal products as well
as the disposals of these products through marketing (Cheghu 2004)
observed that the sector generates employment for the teeming population
over the years, the agricultural production has witnessed a drastic decline
in productivity.
2
,Recently, due to the current decline in the world oil market price and
economic downturn which has also affected the oil sector in Nigeria; there
is a realization of the importance of the agricultural sector to get its former
pride of place. The general impression about the agricultural sector opined
those local farmers carry out small-scale operations characterized by low
productivity and low income due to their capital formation. Ekpebu (2006)
posited that the performance of the agricultural sector has been
unsatisfying over the years due to insufficient funding or credit facility,
inadequate infrastructural facilities, low technology base, high cost of farm
inputs, and inadequate extension services.
Trzeciak-Duval (2003) opined that agriculture like all other sectors of the
economy needs credit for its development. But the inadequacy and death
of credit for financing agriculture are one of the greatest problems facing
agricultural development in most developing countries like Nigeria
(Oyewale and Oloko, 2002) while Akubuilo (2002) added that inadequacy
of loans and credit services is among the constraints against effective
farming among rural farmers. The inability to purchase the modern
requisites needs to be supplied with loans from banks and other credit
facilities which will be used to increase production. These facts have often
led the Nigerian government to promote and support the supply of credits
(loans) to farmers and make loan acquisition easy enough for farmers
hence, enhance or increase agricultural productivity at a large scale.
In the past years, the Nigerian government has lent financial intermediation
through the establishment of lending agencies in addition to formal credit
sources such as banks. This was done in the hope that such programs
would have led to an effective supply of financial services in advances of
demand for them from the sector. Despite all these intermediations by the
government, the impact of loan acquisition is still low and the demand for
credit is still higher than the supply (Ago 2002).
The problem of low impact of loan acquisition in agriculture seems to be a
common feature of the public credit scheme to finance the agricultural
sector because of the problem of low productivity associated with low
impact of loan acquisition and situations where individuals engage in
business other than farming because of a quick return and a relatively high
3
, degree of certainty (Okon and Nyienakuna, 2002). The impact of loan
acquisition and other problems associated with agricultural financing
reduce the funds available and require a disproportionate amount of
administrative cost and time to recover the loan, thus profitability is
reduced. These problems have persistently plagued the agricultural sector
of loan and credit to the agricultural sector all to improve agricultural
productivity.
Generally, the small-scale farmers in Nigeria are poor. Inadequate micro-
credit constitutes constraints to their productive capacity. Important factors
such as inadequate infrastructure, poor social service, and low technical
know-how contribute significantly to the small farmer's limited access to
loan facilities (Oyeyinka, 2002). The shortages in the supply of loans and
farm credit in Nigeria are caused by the inability of farmers to produce
collateral to enable them to collect loans for enhancement of their
agricultural production and the relevance of commercial banks to release
loans to farmers. Therefore, farmers now depend on informal sources for
agricultural financing which results in the ability of the farmers to
accumulate enough capital. So, it is argued that, if loans were made
available to these farmers, the agricultural sector would develop more
rapidly (Nwagbo 2000).
Therefore, the federal government of Nigeria initiated programs and
established institutions to serve as a strategy to increasing productivity as
well as raising the income of farmers through The Nigerian agriculture and
co-operative bank (NACB 1973) now known as the bank of agriculture
(BOA) through the merger of defunct Nigerian agriculture and co-operative
bank and defunct people bank of Nigeria by the decree 22 of 1990.
Agricultural credit guarantee scheme (ACGS, 1978), operation feed the
nation (OFN, 1976), and non-governmental organization (NGO). To make
loans and credit available to farmers at a cheaper rate in all aspects of
agricultural production, processing, and marketing.
A high rate of default associated with the agricultural loan is a clear
indication that something is wrong with loan management. It is either the
loan organization are not efficient in loan administration or the loan users
are not utilizing well or they even utilize it well but formed the attitude of not
repaying, either because, it is an agricultural loan which has been
4
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller THEEXCELLENCELIBRARY. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $19.49. You're not tied to anything after your purchase.
