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Full Project – The impact of agricultural cooperative society in a competitive market economy and its role

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CHAPTER ONE

1.0 INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Members of agricultural societies suffers as a result of selling their agricultural produce raw that is unprocessed as well as the loss and difficulties encountered by competitive marketing their agricultural produce in other people competitive marketing form.

Agricultural co-operative are organized by farmers to help them solve their problems collectively so, therefore loss members suffers as a result of result of selling their agricultural produce raw that is unprocess as well as the loss the problems that members encountered are as members to mention.

The problems are as follows:-

(i) Law pricing at the product. Most consumers at the agricultural co-operative suffers low pricing at the processed and unprocessed produce at the members.

Agricultural co-operative like any other co-operative societies are known to face many problems.

(ii) The revenue that is gotten from the members at the agricultural co-operative societies might be small. The revenue gotten may not solve the problems of the unprocessed produce at members that is the rate at exportation at Agro products the revenue may be too small.

(iii) Damages can occur because if the members live the products that is agro products unprocessed they might delay accordingly and get bad most especially when there is no storage facilities to reserve and store them. Since the output the agricultural co-operatives are much larger than those of individual farmers one should expect a much more substantial waste. A large proportion at the harvest is wasted for lack at storage facilities.

(iv) Transportation cost of the unprocessed at the agricultural produce of members is too high that the members may not afford it all by themselves and it might be beyond their limit. These tends to discourage members in subsequent season the members loss a lot of interest.

(v) The difficulties encountered by process their agricultural produce in other peoples competitive marketing farm are numbers but with these facts it is the increase cost of production which may affect the price of goods and services of the end of the day and it is so, this wick affect the competitive cost. The member face a lot of difficulties in competitive marketing in other people farm the production of the products will be at their own time this will delay the cost of members products. The time used by the people farm will delay all their activities and also make them to loss the profit that will be gained by the members although co-operative societies are not profit oriented.

Finally, the low quality of competitive marketing the member produce that is the low quality of the products. And also now quality of machines the product that is been used to process the agro produce at the members that is lack of competitive marketing facilities.

1.2 STATEMENT OF PROBLEMS

Members at agricultural co-operative societies have been facing a lot of problems especially in the competitive market of their agricultural products. Some of these problems are common to most societies while some of them are peculiar to agricultural co-operative such problems include the following:-

(a) LACK OF COMPETITIVE MARKET FACILITIES

An alternative to marketing agricultural produce is to process them as bad been observed only few co-operative societies can engage in competitive marketing because of the high capital cost. Most factories are located in the urban areas for array from the farmers who needs it most.

(b) TECHNOLOGICAL CONSTRAINTS

It is quite difficult for the farmers to adapt to the new technology due to the high capital cost of doing so. Out modeled tools and the traditional method at farming is still being used.

Members of agricultural co-operative societies which produce large amount of product suffer from poor marking. Inadequate marketing outlet of the processed products result of the processed products result from poor infrastructure facilities like roads, water ways e.t.c substantial season. Due to the large capital requirement, it is difficult for societies to embark on infrastructural development.

(d) LACK OF STORAGE FACILITIES

A large proportion of the harvest is wasted for lack of storage facilities. Since the output of agricultural co-operatives are much larger than those of individual farmers one should expect a much more substantial waste. Because of lack of capital and the reluctance of financial houses to finance co-operative ventures it is quit difficult for societies to embark on such.

(e) ATTITUDE OF BANKS TOWARDS AGRICULTURAL CO-OPERATIVES

Banks are very reluctance to deal with agricultural co-operatives in Nigerian. The later can hardly obtain loan from the banks on their own merit except the state government stands as a result of careless manner in which some societies handle bank loans in the past. Most often governments are made to such loans which they are guarantors. The indebtedness of co-operative can be explained from the view point of poor leadership and poor management of societies resources.

(f) HIGH LABOUR COST

This constraint is as a result of more attractive remuneration in other occupation like industry and commerce. The high labour cost is because due to the work is strainers the members will have to demand for high cost/ high salary.

(g) LACK OF CAPITALS

Competitive marketing of agricultural co-operative societies require a large amount of agricultural competitive include access to tractors, either by purchase or hire and other competitive marketing machines.

(h) LACK OF PATRONAGE

Patronage is very important components to successful agricultural co-operative societies more especially in competitive marketing of agricultural co-operative societies. Patronage is not only in the financial contribution to the society alive. However there should be enough time to be denoted to the farm right from the preparation stage to the harvesting period. Members may have to deliver their products to the co-operative marketing societies e.t.c. At first members tends to be highly enthusiastic about their society but when they realize the sacrifice they are expected to render in terms of patronage they being to loose interest members constant education is required to overcome this.

(i) MANAGEMENT PROBLEMS

This had lead to inefficient application of funds, also the diversion of the funds to non agricultural and sometimes non- productive uses is a big treat. Bad management affect the agricultural societies because it leads to a low agricultural societies because it leads to a low insufficient process.

The agricultural co-operatives are facilitating these problems through these recommended solutions they are as follows:-

(i) They should be strict adherence to timelines in the completive marketing at application and release of fund by credit institutions and organization to farmers and members

(ii) Agricultural co-operative developments should be in the portfolio at agricultural ministries where they are most relevant alternatively a distinct ministry a co-operative should be established by each state government.

(iii) Government should fund agricultural co-operatives through soft loans

(iv) Agricultural co-operative banks should be funded adequately so the they will meet the demand of the farmers members at co-operative

(v) Establishment at a network of functional agro services centers in exist state of federation should be adopted in the port folio at agricultural ministries where

(vi) Government should be more involved in assisting agricultural membership

(vii) Government should increase the production and competitive marketing of exportable commodities with a view to increasing their foreign exchange earnings and further diversifying the country export base and services for foreign earnings.

(viii) To use agricultural co-operatives to increase the production of agricultural raw materials to meet the growth of an expanding industrial sector.

Furthermore, after recommending the solution/ tacking of the problems there must be reasons why the problems persist. The problems persist why the problems persist. The problems persist because (agricultural co-operative) continue to lack a lot of things involved that is inadequate technology and also human factor i.e the fact people has not handle it well. They misconduct the members making them to loss the produce of the members to other people/ difficulties. The problem of finance/ capital that is not being able to have enough resources to further the agricultural competitive marketing co-operative societies of members.

1.3 OBJECTIVES OF THE STUDY

The objective of this work is to find out agricultural products of co-operative and its impact in a competitive marketing economy specifically, the study is meant to identify which of the competitive marketing problems the agricultural co-operative solves for/ handles for members. To identify the problems members face in the competitive marketing of their agricultural products. To support ways of improvement for agricultural towards the competitive marketing of agricultural products of members.

– Agricultural co-operative helps to protect members from the exploitation of middlemen

– It helps the society to know how to product and utilize agricultural produce

– It helps the society to take advantages of economic of scale in production competitive marketing

– It helps in marketing of agricultural products

– It helps agricultural operators to obtain credit for both production and marketing from financial institutions

– It enables agricultural operators to make efficient and of efficient income that will enable them to carry out agricultural operators to produce and purchase good and efficient tools needed.

1.4 RESEARCH QUESTION

(1) How can government help agricultural co-operative societies?

(2) The major problems agricultural co-operative societies face in Imo state?

(3) How can this problem be reduced?

(4) How can they be granted enough credit facilities?

(5) How has poor credit facilities influence the role of co-operatives in marketing of agricultural products?

(6) How can the society stand its competitive in competitive market?

1.5 STATEMENT OF HYPOTHESIS

The following are the hypothesis which include tested.

H^o– Null hypothesis Hⁱ– alternate H^o– agricultural co-operatives do not play a significant role in the competitive marketing of the agricultural produce of members. Hⁱ– agricultural co-operatives play a significant role in the competitive marketing of the agricultural produce of members.

1.6 SIGNIFICANCE OF THE STUDY

The research tends to reveal the importance of this study to farmers, agricultural co-operatives, agricultural policy makers and government and not forgetting the researcher. Firstly, lets reveal the importance of the to agricultural policy makers and government. Nigerians agricultural policy is the synthesis of the framework and action plans of government designed to achieve overall agricultural growth in all the sub- sectors of agriculture and the structural transformation necessary for the overall socio economic development of the country as well as the improvement in the quality to the agricultural policy because agricultural policy because agricultural co-operatives increase the production of agricultural raw materials to meet the growth of an expanding industry sector. Modernization of agricultural production competitive marketing storage and distribution through the infusion of improved technologies and management so that agricultural co-operatives can be more responsive to the demand of other sectors of the Nigeria economy.

Secondly, the importance of those study to the farmer. Before then, agricultural co-operative are organized by farmers to help themselves solve their problems collectively. It gives farms free training and functional education soon after joining as members.

Thirdly, the importance of this study of the researcher. It is important to the researcher because it gave her he knowledge to know how the agricultural products are being processed and taking it in form a raw materials, it has to be processed before consuming. It is important because agricultural co-operatives to its members provides and gives the crops to farmers and makes them a better opportunity skill improvement. Agricultural co-operatives provide job opportunities to the gobblers members.

Finally, it encourages distribution of agricultural inputs to co-operatives farmer and others and promotion of good marketing and distribution through agricultural co-operatives.

1.7 SCOPE OF THE STUDY

Imo state is the focus of this study and it is made up of various local government areas. These are various types of agricultural co-operative societies that embark in production and marketing of agricultural produce. They are as follows:-

– CO-OPERATIVE PRODUCE MARKETING SOCIETY (CPMS):-This is concerned with the purchase, storage, transportation and marketing of agricultural produce like coca, palm produce which are

Supplied by farmers members. It operates under the umbrella of the “ CO-OPERATIVE PRODUCE MARKETING UNION (CPMU)” it is been located in the south

– CO-OPERATIVE CONSUMER SOCIETIES (CCS):- This supplies members with household goods and other consumer goods. The capital of the society is contributed by the its members and the profits are distributed to each members purchase

– CO-OPERATIVE THRIFT AND CREDIT SOCIETIES:- This was established o alleviate the financial problems of the farmers who are usually not considered credit worthy. Each member contributes towards the production.

– CO-OPERATIVE CREDIT AND MARKETING SOCIETIES:- It is been located in the North. They deal with palm produce coca.

1.8 LIMITATION OF THE STUDY

There are some constraints towards this study. Among them are explained below. Respondents attitude:

– POOR ATTITUDE

Poor attitude, compelled with illiteracy or as one of the greatest hindrances. Some of the co-operators were not willing to give out relevant information and intelligent answers to my interviews. Their attitude are very but because sometimes they treat me as if I am disturbing them although not all but if they are 100, 98% attitude are bad while 10% are fair.

– TRANSPORTATION: Transportation cost is another type of hindrance. Most of the co-operative are located in the remote areas of the state. The roads leading to these places are not really good but manageable and in most cases, the researcher had to use motorcycles as an alternative means (government has banned the motorcycles called Okada men towards those areas) and it cost too much money.

– TIME FACTOR

The time allowed for this study is quite short, especially when one had to combine her lecturers period with the research. It is an easy task.

– LIMITATION OF FUNDS

Within the period of this research work, sufficient fund was not within my reach due to the present situation of things like financial problems which has been eating me up the scarcity of fund restricted me from cover must of the areas designed in the research.

1.9 DEFINITION OF TERMS

(i) AGRICULTURAL CO-OPERATIVES:- They are co-operative societies that engage in the production competitive marketing, marketing and distribution of agricultural products.

(ii) COMPETITIVE MARKETING OF AGRICULTURAL PRODUCTS:- For the purpose of this project this can be defined as the performance all business activities involved in the flow food/ cash product from the pout of initial agricultural production until they are in the hard of the consumers

(iii) PRODUCTION:- This is the process of transmitting or changing inputs into outputs

(iv) BULK PURCHASE: This involves buying of things in large quantities or sizes

(v) CO-OPERATIVE SOCIETIES: Co-operative societies are voluntary business organizations owned and controlled by members and they are at providing services for the mutual benefits at all members. The business is based on the democratic principles and open membership.

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