STANDARD ESTIMATION OF THE FUNCTIONS OF THE EQUILIBRIUM VALUES OF CANE SUGAR PRICES
Abstract: The objective of the study is to determine the equilibrium values of cane and sugar prices by conducting a model of successive equations. The model determines the equilibrium values of sugar based on the prices and costs of sugar cane. It is shown that the increase in the production costs of sugar cane by 1 pound/ton increases the price of raw sugar cane by about 2.82 pound/ton. Also, increasing price of raw sugar cane one pound/ton increases sugar price by 0.02 pound/kg. The increase in the unit cost of imported inputs in pounds/ton increases the price of sugar by about 0.008 pounds/kg while it was found that the decrease in the price of sugar at constant prices by one pound/kg increases the sugar sold quantity by 1.09 ton. The main factors influencing the size of the food gap of sugar are the total production, the total consumption volume and the consumer price of sugar. These factors contribute about 99 % of the total changes in the food gap of sugar during Period (2000-2016). The decline in the government revenues is also due to the increase in the domestic demand for the local supply of sugar and hence the increase in sugar imports which is a burden on the state budget. The study also shows that the local consumer bears prices higher than those determined by the market forces which leads to an increase in its expenditure on sugar due to the purchase of low quantities at high prices followed by a decline in consumer welfare. The study recommends that the state adopt a price policy for sugar cane based on linking its prices to the production costs of the ton to achieve sufficient return for the farmer as well as modernizing and developing the sugar factories in Egypt in line with the technological development and the maximum utilization of the quantities supplied and operating the factories at full operational capacit
Publication year 2017
Organization Name
serial title المجلة المصرية للاقتصاد الزراعي، الجمعية المصرية للاقتصاد الزراعي
Author(s) from ARC
Publication Type Journal
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