Structural Change in Saudi Agriculture

Abstract The objective of this paper is to study and analyze some features, causes and consequences of structural change in Saudi farming industry between 1973/74 and 1981182. The study showed that farm size increased by 50%. The concentration coefficient of area distribution among land holders decreased from 0.79 to 0.733. The relative importance of agricultural corporation in farming increased dramatically. The relative importance of owned area increased to reach 83.71 % of total area, and the dependence of hired farm managers increased. Advanced technology, economic development, adequate marketing conditions, and governmental support programs and policies were the main causes of structural change. The structural change influenced many aspects of farm practices. The intercept of the negative significant relationship between farm size and the percentage of irrigated area decreased significantly, but the slope was not affected. The relative importance of production for market increased, while the percentage of production for auto-consumption purposes decreased from 45.78% to 13.04% only. Wheat area increased by 80.95%. The intercepts of the estimated negative relationships between farm size and both the percentage of the area producing for auto-consumption and the percentage of wheat area decreased, while the corresponding slopes increased. The intensity of capital resources was increased, while the intensity of labor was decreased in farm practices. The intercept of the estimated relationship between farm size and utilized quantity of chemical fertilizers per donum increased significantly, while its slope was not influenced. The estimated positive relationship between farm size and the utilized area served by one farm worker was identical in both years. It was concluded that the consequences of structural change in Saudi agriculture were reflected in a drastic increase in the production of most agricultural products. The productivity of wheat, millet, sorghum, maize, sesame, vegetables, and fruits increased by 50%, 53.13%, 52.38%, 40.30%, 51.72%, 4.90% and 3.61 % respectively. The annual growth rate in real value of agricultural production amounted to about 6:28% during the period under study