Economic value and latent demand for agricultural drought forecast: Emerging market for weather and climate information in Central-Southern Nigeria
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Date
2023
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Abstract
Provision of weather and climate services are expected to improve the capacity for rural
households’ preparedness and response plans to weather shocks. With increase in public investments
in developing and communicating weather information on local scale in Nigeria, uncertainty
in timescales that meet farmers’ needs and economic value of the information is still
poorly understood. It is now a policy concern on whether farmers’ preferences and demands
might increase its uptake. This study analyzed the economic value, latent demand, and emerging
market of weather and climate information in Central-Southern Nigeria. Farm-level crosssectional
data reveals that 76% of the respondents were willing to pay for improved weather
information and early warnings in taking climate smart decisions. Within farmers who showed
positive responses, 86% would pay for sub-seasonal to seasonal weather information while 38%
would pay for medium and short range weather information respectively. The economic value of
sub-seasonal to seasonal weather information was estimated at N1600 ($3.60) per year per capita
with total aggregated value of N1.3 billion ($2.9 m) yearly for the derived savannah area. Predictive
total market value of N17.43billion ($39 m) would be obtained from improved weather
information in Nigeria. Simulated results of 5% increase in the uptake with better dissemination
channel through mobile phones in addition to robust farmers’ oriented features will generate
additional annual market value at N86m ($193,360) for service providers. Large farm size, good
farm-income, mobile phone dissemination channels, and location-specific information were
drivers of farmers’ uptake decisions of weather information in the dry savannah area. The huge
emerging market for improved weather information should be developed into a public–private
market to efficiently facilitate uptake and use in Nigeria.
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This article is published by Elsevier.com and is also available at https://doi.org/10.1016/j.crm.2023.100478
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https://doi.org/10.1016/j.crm.2023.100478