ASSESSMENT OF AGRICULTURAL RISK FINANCING STRATEGIES ON FOOD SECURITY AMONG SELECTED SMALLHOLDER FARMERS IN EKITI STATE, NIGERIA

R. S. Owoeye, M. J. Falade and F. J. Kolapo

International Journal of Agriculture and Environmental Research, 2025, vol. 11, issue 4

Abstract: Smallholder farmers in Nigeria face significant challenges in managing agricultural risks, which can lead to crop failure, livestock death, and reduced productivity, ultimately threatening food security and exacerbating poverty and hunger. The study aimed at identifying the agricultural risks, examining the effectiveness of agricultural risk financing strategies on food security, investigating the impact of agricultural risk financing strategies on farmers’ decision-making and ascertaining the barriers to agricultural risk financing strategies among smallholder farmers in Ekiti State, Nigeria. A multi-stage sampling technique, with the aid of a well-structured questionnaire, was used to elicit information from 450 smallholder farmers from 3 Local Government Areas (i.e., 150 smallholder farmers from each Local Government Area (LGA)). The data obtained were analyzed with the aid of descriptive statistics, linear and logistic regression models. From the results, it was revealed that weather-related issues (89.3%), crop failure (85.3%), price volatility (70.7%) and pests and diseases (64.4%) were the notable and prevalent agricultural risks in the study area as reported by the farmers. The result further revealed that level of education; access to extension services, use of agricultural insurance and crop diversification were the significant predictors of food security while access to extension services, access to markets, membership of farmers’ organization and amount of money saved were the statistically significant variables influencing farmers decision making to adopt agricultural risk financing strategies. The result also showed that limited access to financial services (68.4%), limited infrastructure (67.1%), limited financial literacy (60.2%), dependence on informal risk management strategies (62.4%) and lack of awareness (62.0%). The study therefore recommends that policymakers and financial institutions should work together to increase access to financial services, including agricultural risk financing products, for smallholder farmers.

Keywords: Agricultural and Food Policy; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ijaeri:371470

DOI: 10.22004/ag.econ.371470

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