Notwithstanding Nigeria‟s rich endowment in black oil and other mineral resources the wellbeing of her economy still largely depends on agricultural sector.
The Nigerian economy is essentially agriculture in terms of national output and employment generation. It is the largest contributor to Gross Domestic Production (GDP) (average 38% in the last 8 years) with crops accounting for 80%, forestry 3% and fishery 4%.
It provides employment for about 65% of the adult labor force and the food and fiber needs of a large and increasing population. The agro-industrial enterprises depend on the sector for raw materials whilst 88% of the non-oil exports earning come from the sector.
The sector contributes a great deal to the development of the economy in various ways:
Agriculture contributes significantly to national food self –sufficiency by accounting for over 90% of total food consumption requirements, its helps to maintain a healthy and peaceful population and also a source of food and nutrition for households.
Furthermore the ultimate objective of interest of economists in productivity should be to find ways of increasing output per unit of input and attaining desirable inter-firm, intra-firm and inter sector transfers of population resources thereby providing the means of raising the standard of living.
In Nigeria, agriculture export has played an important role in economic development by providing the needed foreign exchange earnings for other capital development project.
Ekpo and Egwaikhide (1994) observed that Nigeria agricultural export has enlarged to include cocoa beans and palm kernel. Statistics indicate that in 1960 agricultural export commodities contributed well over 75% of total annual merchandise exports. In 1940‟s and 50‟s Nigeria was ranked very high in the production and exportation of major crops in the world.
For instance, Nigeria was the largest exporter of palm oil and palm kernel, second to Ghana in cocoa and third position in the exportation of groundnut. Olayide and Essang (1976) report that Nigeria export earnings from major agricultural crops contributed significantly to the Gross Domestic Product (GDP).
In terms of employment, the sector is still leading in economic activities, while accounting for one-third of the Gross Domestic Product (GDP). It remains the leading employment sector of the vast majority of the Nigerian population as it employs two- third of the labor force Bola (2007).
Olatunji (2002) observed that in Nigeria today, farming still remains the sources of employment of majority of the adult population, its productivity is the most important single factor influencing the standard of living of both the rural and urban centers.
Agriculture indeed has remained the major sources of income to the economy. About 90% of the rural population is involved in activities related to the crop sub-sector which provides the bulk of agricultural income. Similarly the crop sub-sector supports the processing industry by providing raw materials.