Food Aid Projections for the Decade of the 1990s (1988) / Chapter Skim
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Appendix G: A Discussion of Long-Term Agricultural Commodity Forecasts and Food Aid Needs
Appendix G: A Discussion of Long-Term Agricultural Commodity Forecasts and Food Aid Needs
Pages 171-183
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From page 171... ...
Nonetheless, we fee} the projections are indicative of the long-run trends in the agricultural sector and, perhaps more importantly, how these trends can be altered by changes in economic growth, technological change, and the trading environment. INTRODUCTION The comparison of the properties and projections of agricultural commodity models is a relatively recent phenomenon (Meilke, 1987~.
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From page 172... ...
First, they had to forecast future supply, demand and prices for many commodities and countries (or groups of countries) in order to compute net imports, also referred to as the "import gap." Second, they had to determine the volume of commercial imports and food aid that constitutes the total imports of net importing developing countries.
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From page 173... ...
The WB models do highlight a serious shortcoming in most of the current generation of multi-region, multicommodity models in that they are almost without exception focused on temperate zone products and countries, even though the export value of the tropical products, sugar, and beverages accounts for almost 14 percent of the value of the worId's agricultural exports (FAO, 19873.i Sugar and rice appear to be the only commodities of direct interest to LDCs that have been given much attention in current models. All of the above models are partial equilibrium models, thus negating our ability to calculate the welfare costs and employment effects of agricultural policies on the nonagricultural sector.
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From page 174... ...
Foreign indebtedness, the import gap, foreign exchange earnings, and domestic and world prices can all be rationalized as potential explanatory variables. As pointed out by Ezekiel, regressing commercial food imports on these variables yields, at best, the country's willingness to buy commercial imports.
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From page 175... ...
Agricultural trade liberalization in FAPR! is limited to grains in the U.S., E.C., Japan, Brazil Argentina Gina mart.
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From page 176... ...
The Ezekiel model does not have policy variables, which implies that its estimates of the import gap and food aid needs are independent of recent policy changes. Eventually, policy changes would be internalized in the trend variables, but short run and intermediate run forecasts would be inaccurate.
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From page 177... ...
Trade in animal products often involves two-way trade in differentiated processed and semi-processed products, with trade further restricted to certain trading groups because of technical regulations. If this is a general representation of the trading environment, then the gains from trade liberalization are likely overstated in a homogenous product model unless the demand for new differentiated varieties increases substantially, an effect which is unlikely to be captured in an empirical model.
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From page 178... ...
According to FAPRI, prices for soybeans and its byproducts would decrease, while the price of corn would rise. This may be attributed to the EC market, where trade liberalization would lower the demand for protein meals and increase the demand for coarse grains.
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From page 179... ...
One may suppose that the income elasticities for wheat and coarse grains are fairly low and/or that their supply curves are very inelastic. Only FAPRI provided production changes on a commodity basis under a freer trade scenario.
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From page 180... ...
shows more pronounced growth in developed countries' net exports and in LDCs' net imports than FAPRI. In general, both models agree on the direction of the changes (e.g., industrial countries' net exports of wheat and coarse grains should rise between 1990 and 1995~.
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From page 181... ...
Moreover, the FAPRI estimates consist of the sum of the import gaps for coarse grains and wheat while Ezekiel's estimate have a broader commodity coverage. Table 4 illustrates some of the differences in the two models.
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From page 182... ...
negotiations will force developed countries and LDCs to make some progress on trade liberalization. Needless to say, the removal of inefficient domestic marketing programs in LDCs would greatly improve food production and distribution and would limit food aid needs.
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From page 183... ...
1987. A Comparison of the Simulation Results from Six International Trade Models.
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