Demand And Supply Of Agricultural Products

solicit And interpret Of untaught ProductsThe floriculture in UAE is reserved to dates, veggies, fish, eggs and dairy intersection points (Ministry of Foreign trade, 2011). Tunnel solid g rhythm method of birth control is the way antecedent to agriculture in UAE, more and more battalion atomic number 18 learning the techniques entirely oerwhelmd in delve market place-gardening. For a rural atomic number 18a identical UAE which is a desert the add available for earth is restrain, and the body of irrigate resources ar likewise extra, t here(predicate)fore victimisation the current technologies in reduceed e argona romps a life-sustaining role in controlling the bestow and study of clownish products in UAE.Water plays an important role in change magnitude or decreasing the tack on of local rustic products in UAE. unrivaled of the studies violateed that the manipulation of piss in UAE on individual basis is adept of the highest in the dry l and (Gornall Tordorova, 2009). For a inelegant with already a real low export of boorish products and local buckle underoff, high water use makes it even more complex to cater for shortages of outlandish products in UAE.The organisation in UAE is elusive in discovering new ways to summation the get available for subtlety by using desert replacement initiatives (Salama, 2008). The organisation has a history of drop in tree planting schemes and irrigation systems to increase the total outlandish business of UAE. The planting schemes involve planting trees which function naturalises to survive wind and besides stop soil erosion, the schemes overly involve initiatives to plant shrubs and date palms. According to figures released by Ministry of floriculture and Fisheries, UAE is producing 600,000 tonnes of crops approximately which include, cucumbers, tomatoes, lettuce, aubergines, cabbages and collapse for live stock. The presidential term of UAE is quickly in crease the land available for cultivation by converting desert into cultivated land bingle of the example is the 40,500 hect atomic number 18s of land available for cultivation along the Liwa Oasis, which has been converted from dessert into cultivatable land, in UAE there be more than 6,000 greenhouses and 22,700 farms.UAE is also committed to go in out in agriculture abroad on islands and other parts of the world, because 85 per penny of the verdant products in UAE are merchandise which include shuck, rice and corn. This is a major threat boldnessd by a country sit to pop off the business hub of the world with an increase creation, therefore the tot and pray forces play a major role in agriculture in UAE. Another outline followed by UAE to tackle sustenance shortages is to create nutrient for thought retention facilities where large quantities of unpolished products could be stored for longer cadence periods.Agricultural Imports and Exports of UAEUAE is the largest importer of pastoral products in the region and the imports of agrarian product in UAE volition increase this year quest the drought in the major exporters of country products in the world which are Russia and Ukraine. Consequently rapidly changing the require and fork up of awkward products in UAE and presents a major altercate for the Government to deal with make out and remove forces in Agricultural products.The global nutriment for thought crisis has reached alarming situation posing a major threat to economies with increase population and consumption of agrarian products. Also the major providers of world boorish products result experience a reduction in their yield of rustic products this year cod to draughts in different parts of the world. The world crop take has change magnitude due to the use of latest techniques for acres as shown by the sideline figure-1 (GRIDA, n.d.).figure07.jpgFigure Trends in crop business of the worldThe increase in wo rld crop product here is because of the increased cropland and rangeland area, increased of yield and greater cropping intensity. so to cater the actual conduct of countrified products it is necessary to use the latest technologies to increase the yield. As the graphical record clearly shows the to the highest degree production increase is seen in Soybeans presentation more than 4 per cent increase in the production. Cotton wheat and rice take a lot of water hence are impossible to be planted in a desert with limited water resources, therefore wheat and rice also adds up to the read in unpolished products in UAE. Abu Dhabi is spending in uncouth seek and development to come up with new ways of farming using minimal water resources. single of the closely important techniques to bear on water in agriculture is to use piping systems, this system enables the farmer to save water in agriculture up to 40 per cent thusly the classical techniques of farming.Following the qu ote crunch the world has moved into duration of scarcity of resources and an increase in the population, more and more people are moving into urban areas in search of a better in store(predicate) and business opportunities. The phenomenon of the move to urban areas is creating humungous pressure on the expect created by urban areas for agricultural products. Most of the agricultural products are used as part of food therefore an increase in population is right away link to the expect created for agricultural products. Another factor affecting the hang on of the agricultural products is the limited animateness of the product due to which suppliers stand to accept heavy cost in storing the products in the end affecting the supply of agricultural products. therefrom supplying agricultural products from all over the world becomes a challenge for even the developed economies of the world with limited local production of agricultural products. In the global colonisation the co nsumer in UAE is ready to pay higher scathes for graphic symbol agricultural products following which the suppliers in agricultural found countries are targeting UAE to earn better profits. Attracting suppliers from India, Pakistan, Russia, Ukraine, US, Australia and other parts of the world have started merchant vessels their agricultural products to the consumers in UAE. Due to complexities and investitures involved in shipping agricultural products overseas and selling it to demoralizeers overseas, the farmers in agriculture enriched countries restrain from acquiring involved in international trade. Inviting speculators in the market who buy the products from farmers and hence sell it in international markets, these speculators hold the power of affecting the monetary value of agricultural products because of the ability to store and hold large quantities of a situation product. Enabling speculators to store the product until they find the right price to glean higher pro fits, this creates a shortage in supply and increase the entreat for the product which eventually increases the price of the product to the level at which the speculators are ready to sell their products to the consumers in UAE.ImportsUAE is the largest importer of agricultural products in the Gulf, the consumers of UAE have the highest consumption when it comes to consuming water and other agricultural products. Due to limited resources for agricultural activities the country has to heavily rely on agricultural imports from all over the world. UAE is also used as a re-export hub of the world some suppliers buy their products from underdeveloped or develop countries of the world with trade restrictions and then amaze the products to UAE enable them to ship the products anywhere in world, the geographic location of UAE makes it seductive for suppliers from all over the world for re-exports.The agricultural products import in UAE areWheatRiceCornTobaccoConsumer Ready Goods veg marrow output veggie ProductsLive Animals and their productsAnimal and vegetable fats, oils and waxesWheat, rice and cotton are completed exported from other parts of the world due to high water consumption involved in the production of these products. Tobacco, Meat, Fruit, and vegetable products are also being planted in UAE using the latest tunnel techniques enabling year round production and swear outing UAE to cope with the extraordinary motivation created for agricultural by a multiplying society. This year the imports are believed to surge over again following the international food crisis, but the worlds production of agricultural products has also increased. Farmers all over the world are involved in using latest techniques of farming increase the total production per area and reducing the water consumption by 40 per cent, enabling farmers to germinate at lower cost.UAE trade AED 3.71 billion worth of agricultural products from US alone in 2011, which was up from AED 44 0 million in 2010 (Duncan, 2012). This shows the rapid increase in the consumption because increase the ask for agricultural products in UAE. This rapid increase in the consumption of UAE in retributory one year is directly related to the increase in the population of UAE and also the country is set to become the business hub of the world attracting more tourist and business men from all over the world increasing the consumption of agricultural products. UAE also imports agricultural products from other parts of the world. some(a) of the top agricultural imports of UAE are shown with the help oneself of following figure-2 (Gulfood 2010 Briefing, 2010).Figure UAE communicate agricultural ImportsThe graph clearly shows the major imports which are hides skins, fats oils, wood products, Meat Animals, prepared Foods and vegetable products. The major chunk of the UAE agricultural demand is the vegetable products as shown by the graph to a higher place, the vegetable products hav e limited life hence require storage capabilities to extend the life of the product, due to which the supply of vegetables becomes a complex procedure starting from the farmer in the developing countries and making it available in the local store of UAE. Abu Dhabi has interpreted many initiatives to grow vegetables using tunnel farming enabling the farmers to produce round the year and also doubling the yield at the same time reducing the water consumption of the crop as hale.The government activity in UAE is involved in initiatives to promote urban farming by fling agricultural studies in colleges and schools and also providing awareness on how to start urban farming, in effort to fight the huge imports of agricultural products in UAE. One of the ideas recently introduce is to use rooftops of buildings in urban areas for farming purposes, tunnels could be used to create the atmosphere call for for the production of any crop year round. At the moment UAE is importing agricultural products from all over the world to tackle its sharply rising imports of agricultural products. Another step taken by the government is to invest in agriculture overseas to tackle the world food crisis.UAE has become the major importer of Agricultural products in the region, the major countries which import to UAE are 18 percent imports are from India, 13 percent from Brazil, 12 percent China, 10 percent United States, 8 percent Australia and the rest 39 percent of the agricultural products are imported from other parts of the world as shown by the pie chart in figure-3.Figure 2007 Data for Dubai and Sharjah Percent Market ShareIndia being the largest supplier of agricultural products to UAE in 2007, the pie chart clearly shows the importance of UAE in the agriculture of the world. Therefore the supply of agricultural products to UAE is a matter affecting the unit world and the food prices in the world, in this time of recession it is rattling for an economy like UAE to reach e quilibrium in the supply and demand of agricultural products to provide sufficient food for the country.In the trade of agricultural products Imports play a major role in case of UAE as shown by the figures above. Therefore in reaching equilibrium in supply and demand forces or agricultural products in UAE managing imports is very important. The government of UAE is actively involved in investing overseas to meet the increasing demand of agricultural products in UAE, following the world food crisis it is predicted that the UAE food consumption allow for increase exerting more pressure on the consumption drive the demand even more higher than the current levels and eventually increasing imports of agricultural products to the country.ExportsThe exports of agricultural products from UAE have been limited to dates and other few vegetable products, agriculture in desert requires desert reclamation. UAE government is involved in initiatives for desert reclamation to increase the local production of agricultural products.The exports of agricultural products in UAE includeDatesAnimal or Vegetable Fats, oils and waxesLive animals and their productsVegetable ProductsDates have been historically imported from UAE which is a competitive edge of the country in the industry to be able to produce high quality dates, alongside which the government is also starting initiatives to commercialize camel milk in surge to reduce the import of milk and start exporting milk from UAE. Tunnel farming has enabled farmers in UAE to produce year round and supply vegetables globally in offseason.The government has started different initiatives to increase local production of agricultural goods by introducing following concepts.Island FarmingTunnel Farming defect ReclamationInvesting overseas in agricultureUAE is involved in farming on islands in the Gulf by using latest techniques of production using tunnel farming the government is trying to help reduce the imports of agricultural produ cts by being self-sufficient. In todays world of credit crunch self sufficiency play a vital role in the success of an economy, the global village has enabled countries with limited resources to be self sufficient by investing overseas.Therefore investing overseas to increase re-exports of UAE plays an important role in the current strategy of being self sufficient in agricultural products. Imports and exports of agricultural products play an important role in the supply and demand of agricultural products to the country. The imports and exports of agricultural products in UAE is shown by following figure-4, which clearly shows how rapidly the demand for agricultural products is increasing over the passage of time.Figure Imports and Exports of Agricultural products in UAEThe graph above clearly shows the increasing trend in the agricultural products of UAE and shows most no change in the behaviour of exports and they are stagnant at USD 1 billion approximately from 2005 to 2006, w hereas imports have increased from approximately USD 6 billion in 2005 to above USD 9 billion in 2007. get ahead the statistics reveal that total Imports of Animal or vegetable fats, oils and waxes for first sixsome months of 2012 were AED 1.268 billion and exports were AED 485 million approximately (National Bureau of Statistics, 2012). Live Animals and their products were also imported and the total imports were AED 5.806 billion and exports were AED 646 million, also AED 11.483 billion worth of vegetable products were imported and AED 304 million were exported. The figures show a substantial increase in imports of vegetable products for country with shortages of water and land available for cultivation.UAE government is taking concrete steps to invest in agricultural products overseas, which include, Egypt, Pakistan, Japan and other stiff parts of the world (Farm Land Grab, 2010). The statistics reveal that the investment in agricultural products by UAE in other countries will increase with the passage of time, as the rising demand of agricultural products invites more and more investors into the industry.Supply and Demand of Agricultural Products in UAEIn the era of global food crisis one of the major challenges faced by UAE is to make sure the uninterrupted supply of agricultural products whether with imports or local production (Malek, 2013). The fresh statistics of 2013 reveal that 90 per cent of the Agricultural products are imported globally, which shows UAEs reliance on the international food market. In 2013 the food crisis is expected to become a major problem for UAE.After a detailed analysis conducted above the following figure-5 shows the supply and demand curves for agricultural products of UAE.Figure Supply and Demand Curves for UAE Agricultural productsAs we can see in figure-5 as the demand increases the supply remains stagnant which clearly shows, UAE needs to invest to increase the local production of agricultural products and also th e country mustiness explore investing overseas for food shortages alongside using latest techniques for farming in UAE. The gap between the curves clearly shows the shortage of food faced by UAE and adding the world food crisis the situation will exasperate in 2013.To tackle the food shortages in UAE the farmers have turned to tunnel farming, tunnels allows farmers to control the temperature and the sunlight required for the growth of the plant (UAE Interact, 2012). It also acts as an incubator enabling the farmer to adjust the atmosphere as required by the plants, also pipe irrigation system is used which helps in delivery water. Sustainable farming is the concept launched by the UAE government from Abu Dhabi to fight the food shortage.In our case the demand for agricultural products in UAE is increasing as shown by the figure-4, creating a shortage, also the local production of UAE is limited due to water shortages and limited land available for cultivation. Therefore the gover nment is centre on tunnel farming and other techniques of water efficient farming in UAE.Demand refers to the relationship between how much of anything people are willing to purchase available at different prices (Grant Vidler, 2000, p. 10). Therefore the increasing exports show that there is a shortage of agricultural products in the market, eventually increasing the demand for agricultural products.Demand and Supply Curvestinting theory reveals that a shortage in supply eventually increases prices, and nimiety in supply reduces demand and decreases the prices eventually (Mceacher, 2012, p. 86). Such a state in economics is known as the state of disequilibrium, when there is a shortage or a surplus. In UAE the demand for agricultural products is increasing on a fast rate, eventually requiring more supply of goods and creating a shortage of agricultural products in the market. The world is already going through a worldwide food crisis followed by the draughts in major exporters of agricultural products like Ukraine and Russia.Managing the demand for agricultural products in UAE is a challenge faced by the government. The shortage in the supply of agricultural products will eventually lead to a food inflation in UAE by the year 2013, to control inflation in agricultural products the government has come up with strategies to increase agriculture by using latest techniques to produce more by using less water.According to law of demand if the price of the good increases the quantity demanded falls, provided other things stay equal (Mankiw, 2012, p. 73). Therefore the demand and price of a agricultural products have an inverse relationship. The above figure clearly shows the demand and supply curves for the agricultural products in UAE, both(prenominal) the demand and supply curve show that there is an increasing shortage in the supply of agricultural products in UAE. Attracting more and more investors from all over the world to invest in agricultural products in UAE, the most attractive region for investors in UAE have become overseas investment in agricultural products. As the world becomes a global village to deal with the increasing volatility and fluctuations in the supply and demand of agricultural products in UAE the government must come up with initiatives to maintain storage for agricultural products, as well as promoting urban farming, tunnel farming and other farming technologies.Factors affecting Demand SupplySome of the most important factors on which the demand of agricultural products in UAE depends are price of the product, prices of the related products, consumer income, expectation of future price changes, savours and number of consumers (Carbaugh, 2010, p. 30). Demand for agricultural products plays the main part in the trade of agricultural products in UAE, consequently increasing the imports of agricultural products in UAE to record levels, making UAE the hub of agricultural products imports and exports. The invoi ce of these factors with respect to agricultural products of UAE is as follows.Price of the productPrice of a product plays a very important role in the demand of that product. If the demand goes up it exerts upward pressure on the price of the product, when the product supplied are equal to the product demand the equilibrium price is reached (Hill, 2006, p. 32). Therefore the price of a product has a direct relationship with the demand of the product, in the case of UAE the agricultural products are experiencing an increase in demand.The prices for agricultural products in UAE are vulnerable because of low local production, desert land and water shortages (Kawach, 2010). According to the figures released by the government of Abu Dhabi, in 2009 the food imports increased by 31.5 per cent which was the record high surge in the imports of agricultural products. The main reason is the rapid increase in the population of UAE and also the food prices paid by the consumers in UAE attracts suppliers from all over the world.Prices of the related productsPrices of other related products with agricultural products also matter some of them are pesticides and other sprays required for farming, the materials required for desert reclamation and animal apply etc. Overall all affecting the prices and eventually increasing or decreasing the demand for agricultural products.Consumer IncomeThe income elasticity of demand represents the change in demand of a product with respect to the change of consumer income (Whittington Delaney, 2008, p. 126). The economic theory suggests that if the consumer income increases it also increases the demand for agricultural products or other normal goods.A study revealed that the monthly household income in UAE has reached up to AED 18,248 while the modal(a) household expenditure is AED 11,241 in 2009 (Bundhun, 2009). This increase in the consumer income in UAE will definitely affect the demand for agricultural products in UAE and eventually increasing the imports of agricultural products in UAE. Therefore we can say that consumer income is directly proportionate to demand of agricultural products in UAE.Expectations of future price changesThe agricultural market has become very volatile due to the world food crisis, and following the draughts in the major economies of the world which certainly affects the future prices of the agricultural products to increase at a fast rate.TastesThe consumer preferences and tastes play a vital role in creating a demand for any product, the health sensible consumer of UAE has definitely increased the demand for vegetables and other healthy food products. The taste preferences of the consumer in UAE have dramatically increased the demand for agricultural products in UAE.Number of ConsumersUAE is experiencing a rapid increase in population as shown by the following figure (World Bank, 2013).population.pngFigure Population of UAEThe above figure-6 clearly shows how rapidly the populati on of UAE has increased from 1995 to 2011, which increases the demand for agricultural products by the consumers of UAE.ConclusionsThe government of UAE must boost up the initiatives started for development of agriculture in the country. The following must be paid full attention to survive the credit crunch prevailing in the global world.Investment in Agriculture abroadThe government of UAE has started investing in agricultural based countries like the followingPakistanKazakhstanEgyptInvesting overseas is the answer to the problem of shortages in supply of the agricultural products in UAE, these investments will also increase the re-exports of UAE and will help to attain equilibrium by filling the supply shortage in the agricultural market of UAE.Tunnel FarmingTunnel farming is also another way forward to provide for the huge demand of agricultural products in UAE. The government has taken steps in Abu Dubai for desert reclamation and tunnel farming. These tunnels enable farmers to produce year round and at a faster pace which helps to increase the yield of the crop as well as reduces the water usage by 40 per cent.Agriculture on IslandsKeeping up with the high demand another way forward is the farming on islands in the Gulf, UAE must pursue its permanent missionary station in the UN to reclaim the Iranian occupied islands, as the country is face huge demand for agricultural product which must be taken care of before the food crisis gears up in the international food markets.