INTERNATIONAL AGRICULTURAL TRADE
INTERNATIONAL AGRICULTURAL TRADE AAEC 4306
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This 2 page Class Notes was uploaded by Dwight Marquardt IV on Thursday October 22, 2015. The Class Notes belongs to AAEC 4306 at Texas Tech University taught by Olga Ivanovna Murova in Fall. Since its upload, it has received 30 views. For similar materials see /class/226378/aaec-4306-texas-tech-university in Agriculture Education at Texas Tech University.
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Date Created: 10/22/15
AAEC 4306 Student Projects Each student needs to select a developing or lessdeveloped country this excludes United States Western European countries Canada Australia and Japan The goal of the project is to identify current food and agricultural situation in that country and to predict the likely evolution of these variables over the next ten years This project is an exercise in data analysis You need to collect data on crop and livestock production food consumption exports and imports In addition you will have to collect macroeconomic data such as income population and exchange rate All agricultural production supply and demand data can be collected through Internet USDA has production supply and distribution database for agricultural commodities called as PSampD online This menudriven software system graphs and displays balance sheet variables for agricultural commodities You can download the entire PSampD online database from httpwww f as nsda v quot dI Inme asnx Most of the data you will need can be found through the intemet The Food and Agricultural Organization wwwfaoorg has extensive data on agricultural and food production consumption exports imports population and so on Macroeconomic data are available in International Financial Statistics published by International Monetary Fund Other sources of data are the World Bank and the OECD all of which have intemet pages You should collect data on crop and livestock production food consumption exports and imports The basic framework for assessing the state of the food and agricultural sector is the balance sheet identity for a country s agricultural sector Domestic Production Imports Domestic Consumption Exports Changes in stocks Domestic consumption includes industrial uses and livestock feed as well as direct human consumption In general it will be possible to include changes in stocks in domestic consumption so that we have Domestic Production Domestic Consumption Net Trade where net trade is defined as the difference between exports and imports Exports Imports You should note the following relationships 1 total consumption per capita consumption x population 2 per capita food consumption is normally positively related to income as measured by per capita GNP or GDP 3 total output of crop i acreage planted to crop i x average yields for crop i 4 acreage planted to a given crop depends on expected returns prices for the crop and costs of production relative to substitute crops while yields depend on the rate of technological change These relationships show the significance of population income prices and technology for the likely evolution of domestic production and consumption In developing the agricultural profile you should select only the most important commodities for your country Be sure to explain how you decided that particular commodities were the most important Important commodities will generally be grains oilseeds including such exotics as palm oil or coconut oil tubers such as yams and cassava fruits and vegetables meat from cattle pigs poultry sheep and goats In some countries you may want to include such export crops as tea cocoa coffee cut owers and so on In addition to the agricultural data you should collect data on nutrition population and population growth GDP GNP and economic growth and the balance of payments All data collected should be presented in the form of tables in an appendix to the paper Important data that you discuss in the text should be presented as charts or graphs You should collect annual data for each variable over the period from 1975 to the most recent year That means you should have some 27 to 30 observations for each variable I recommend using Excel to manipulate the data although you may use whatever spreadsheet program you prefer Excel is useful because it allows you to compute and plot time trends with a minimum of effort The rst step in the analysis is to describe the main crop and livestock industries trends in total and per capita food consumption the state of the general economy and so on The goal in this part of the paper is to derive a detailed description of the country s general economy and of its food and agricultural industries on the basis of the statistical information you have gathered You should be as creative as you can in developing your description of the country s economy and its food and agricultural industries Comment on trends in production population growth nutritional status trade relations import dependency or whatever else you see that is important What has been going on and what is the country s situation today The second step in the analysis is to predict the future evolution of important variables and to discuss the implications of these predictions for the country s trade relations the nutritional status of its population its overall economic prospects and so on To do this you should use Excel or some other spreadsheet program to fit time trends which can be extrapolated to forecast the future Try all the options linear quadratic logarithmic etc and choose the one that seems to give the best fit Use the time trend to predict the evolution of the variables over the next ten to twenty years For example from the identity above we know that net trade is equal to the difference between production and consumption Use the time trends for the country s production and consumption of its main staple crop maize rice cassava etc to predict how these variables will change in the future If the country is a net importer and the consumption trend has a steeper slope than the production trend you would conclude that net imports are likely to increase over time As in the preceding part you should be as creative as possible in developing predictions of the country s future food consumption trade nutritional status and how variations in your assumptions about population growth income growth and technological change might in uence the results The final part of the paper should be a conclusion summarizing your evaluation of the food and nutritional prospects of the country you have chosen to study
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