INTRODUCTION

1.1 Background of the studyAgriculture   is   the   foundation   and   bedrock   upon   which   the   development   of   stable   humancommunity   has   depended   on   throughout   the   whole   universe   such   as   rural   and   urbancommunities.  It  is   concerned   with   the   husbandry   of  crops   and   animals   for   food   and   otherpurpose. The study of the history of economics provides us with ample evidence that can proofthat   agricultural   revolution   is   a   fundamental   precondition   for   economic   development.   Theagricultural sector has the potentials to be the Industrial and economic springboard from which acountry’s   development   can   take  off.   Indeed,   more   often   than   not,   agricultural  activities   areusually   concentrated   in   the   less   developed   rural   areas   where   there   is   a   need   for   ruraltransformation, redistribution, poverty alleviation and socio-economic development.Agriculture in the context of the economy is tied with the various sectors and is essential forgenerating broad based growth necessary for development. Agriculture is fundamental to thesustenance of life and it is the bedrock of economic development, especially in the provision ofadequate   and   nutritious   food   so  vital   for   human   development   and   industrial   raw   materials.Sustainable agricultural development is propelled by agricultural policies. The first national  onagriculture was adopted in 1988 and was accepted to remain valid for about fifteen years, that is,up to year 2000. Also, in year 2001, a new   document on agriculture, was lunched. The newdocument has most of the features of the old ones, but with more focused direction and betterarticulation. Agricultural policies are supported by sub-policies that facilitate the growth of thesector.   Implementation   of   agricultural   policies   is   however   moderated   by   macro-economicpolicies which provide the enabling environment for agriculture to grow pari passu with the other1

sectors. These policies usually have major impact on profitability of the agricultural system andthe welfare of farmers  as they  affect the flow of funds to the sector in terms  of budgetaryallocation, credit, subsides, taxes and therefore, must be in harmony and mutually reinforcingwith the agricultural policies. The macro-policies comprise the fiscal, monetary, trade budgetarypolicies and other policies that govern macro-prices.The agricultural sector has potentials to shape the landscape, provide environmental benefitssuch   as   conservation,   guarantee   sustainable   management   of   renewable   natural   resources,preserve biodiversity and  contribute to the  viability of rural areas development. Through itsspheres of activities at both the macro and micro levels, the agricultural sector is strategicallypositioned to have a high multiplier and linkage effect on any nation’s quest for socio-economicand industrial development. The growth of the agricultural sector in Nigeria was not smooth.Adubi (2000) defined agriculture as the cultivation of soil for crop production and of lookingafter animals to produce better meat and other food products and also a process by which farmproducts are sold.According   to   Anyanwu   (1997),   the   role   of   agriculture   in   transforming   both   the   social   andeconomic framework of an economy cannot be overemphasized. in effect it has been the mainsource gainful employment from which the nation can feed its teeming population providing thenation industries with local raw materials and as a reliable source of government revenueThe agriculture sector in the 1960’s was contributing 85 percent of Nigeria foreign Exchange earning 90 percent employment generation, and about 80 percent to gross domesticproduct (CBN, 2010).2

However, the sector since the discovery of oil has witnessed lots of neglect from the varioussuccessive governments. At present, agriculture accounts for only 35 percent of the real sector,while crude oil accounts for about 55 percent and above.The   role   of   the   agricultural   sector   in   bringing   about   economic   growth   and   sustainabledevelopment of a nation cannot be underestimated. Okolo (2004) described agricultural sector asthe most important sector of the Nigeria’s economy which holds a lot of potentials for the nationas it had done in past. The agricultural sector is arguably the most important sector of economy.Abayomi (1997) once averred that the principal explanation for poor economic performance, isthe negligence of the agricultural sector, while rising agricultural productivity has been the mostimportant concomitant of successful industrialization. Thus, it is not an overstatement to assertthat the growth and development of Nigeria depend to a large extent on development of theagricultural sector.On attainment of political independence in 1960, the trend was still very much the same, theNigeria economy could reasonably be described as an agricultural economy, because agricultureserved as the engine of the growth of the overall economy (Ogen 2003). According to Alkali(1997) Nigeria was the world’s second largest producer of cocoa, largest exporter of palm oilduring the period. And was also a leading exporter of other major commodities such as cotton,groundnut,   rubber,   hides   and   skins.   Despite   the   reliance   of   Nigerian   peasant   farmers   ontraditional tools and indigenous farming methods, these farmer produced up to 705 of Nigerian’sexports and 95% of its food needs (Lawal, 1997)