Impacts of the Economic Reform Program on the Performance of the Egyptian Agricultural Sector
AbstractFrom 1986 to 2007 Egypt's agricultural policy transitioned from a tightly controlled to a more liberalized regime. This study examines the impact of this change on the performance of the wheat (imported grain) and rice (exported grain) sectors. In terms of profitability, we found that the cost of production increased substantially in both grains, driven primarily by the rise in land rent and labor wage. But the wheat and rice sectors' profitability did not suffer significantly, as advances in new seed technologies and adoption of better farm practices including farm mechanization increased yield and compensated for the higher cost. Considering market efficiency, we found that over the study period the farmer's share of the consumer's expenditure dropped from 51% to 37% in the case of wheat, while it increased from 24% to 26% in the case of rice. The reverse happened for wholesale and retail margin share, where it increased for wheat and decreased for rice. It is likely that the discipline from foreign suppliers of imported wheat and foreign market opportunities for exported rice may explain the difference in the changes of the distribution of consumer expenditure. Finally, we found that area response elasticity decreased over time from 0.58 to 0.12 for rice and 0.60 to 0.38 for wheat. The lack of response in rice area despite rising prices is attributed to the land limit strictly imposed by the Government of Egypt because of water supply constraint considerations. On the other hand, the lack of response in wheat area despite rising wheat prices may be attributed to the rising competitiveness of Egyptian clover, which is a main feed ingredient for the growing livestock sector.
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Bibliographic InfoPaper provided by Food and Agricultural Policy Research Institute (FAPRI) at Iowa State University in its series Food and Agricultural Policy Research Institute (FAPRI) Publications with number 10-wp509.
Date of creation: Jul 2010
Date of revision:
agricultural liberalization; area response elasticity; market efficiency; profitability.;
Other versions of this item:
- Ibrahim Soliman & Jacinto F. Fabiosa & Mohamed Gaber Amer & Siham Kandil, 2010. "Impacts of the Economic Reform Program on the Performance of the Egyptian Agricultural Sector," Center for Agricultural and Rural Development (CARD) Publications 10-wp509, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- NEP-AGR-2010-08-06 (Agricultural Economics)
- NEP-ALL-2010-08-06 (All new papers)
- NEP-EFF-2010-08-06 (Efficiency & Productivity)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Soliman, Ibrahim & Ewaida, Osama, 1996. "Impact of technological changes and economic liberalization on agricultural labor employment and Productivity," MPRA Paper 31165, University Library of Munich, Germany, revised 29 Dec 1996.
- Soliman, Ibrahim & Eid, Nafissa, 1995. "Impacts Of Egyptian Socio-Economic Environment On Dietary Pattern And Adequacy," Reprints 107278, Zagazig University, Department of Agricultural Economics.
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