Evaluation of the factors affecting the demand of sugar import in Iran (emphasis on sugar beet production)

Document Type : Scientific - Research

Authors

1 Associate Professor, Department of Economics, Allameh Tabatabai University, Tehran, Iran

2 tarbiat Modares University

3 payame noor university international center

10.22092/jsb.2024.365555.1359

Abstract

International trade plays a vital role in the global economy, and the import of goods is one of its main pillars. Through the import of goods and services, countries can gain access to goods and services that are not produced domestically or that have high production cost. Sugar is considered as one of the country's strategic goods, and due to its high demand and consumption in recent years, the country has witnessed the import of this product. Dependence on the import of sugar and the inadequacy of its domestic production will cause any policy change in the import of this product to affect the welfare of many producers and consumers. Considering the close relationship between sugar import and food security of households, knowing the factors affecting the demand for sugar import becomes especially important for proper policy making in this sector. In this research, the factors affecting the demand for sugar import including the amount of sugar beet production, the amount of annual rainfall in the country, the world price of sugar and the gross domestic product, have been evaluated in the form of vector error correction model (VECM) in the period of 2011-2014. According to the obtained results, the amount of sugar beet production, the amount of annual rainfall in the country, and the global price of sugar have a significant and negative effect on the amount of sugar import demand. Sugar beet production is 1.89 units and has a negative and significant relationship with sugar import demand, which makes it important to increase productivity and support domestic production. The amount of annual rainfall of 3.24 units has a negative effect on the demand for sugar imports, which is the production theory in the economy. In other words, with the increase in the amount of inputs used in the production, the amount of production increase. Also, the world price of sugar is 0.91 units inversely related to the amount of sugar import demand, which is obvious and can be justified based on the law of demand. Finally, the GDP variable has a positive effect of 0.82 units on the amount of sugar imports, which indicates that during the period of economic growth and prosperity, the desire to import increases in the country and the per capita consumption of goods increases

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References

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Journal of Sugar Beet
Volume 39, Issue 2
February 2024
Pages 233-242

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