Agriculture in Palestine (2023)

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Impacts of Water and Export Market Restrictions onPalestinian Agriculture

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DavidButterfield*, Jad Isaac**, Atif Kubursi* and Steven Spencer*

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* McMasterUniversity and Econometric Research Limited

** AppliedResearch Institute of Jerusalem (ARIJ)

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Financialsupport from the International Development Research Center (IDRC) is gratefullyacknowledged

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Introduction

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Agriculture remains a dominant sector of the Palestinianeconomy. It represents a major component of the economy’s GDP, and employs alarge fraction of the population. Furthermore, the agricultural sector is amajor earner of foreign exchange and supplies the basic needs of the majorityof the local population. In times of difficulty, the agricultural sector hasacted as a buffer that absorbs large scores of unemployed people who lost theirjobs in Israel or other local sectors of the economy.

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Palestinian agriculture is constrained by available land andwater, as well as access to markets. These constraints have been the object ofpolitical conflict, as Israeli authorities have limited available land, waterand markets. It is widely recognized that resolution of these conflicts isessential to the establishment of peace in the region (Dinar and Wolf 1994a;Dinar and Wolf 1994b; Berck and Lipow 1994; Wolf 1993; Wolf and Ross 1992; andYaron 1994). Since Palestinian agriculture is a major potential user of landand water, it is important to establish its needs for these resources.Typically, models for the allocation of water in the region have used a simplederived demand function for water, in which the elasticity of demand is the keyparameter (Bogess, Lacewell and Zilberman 1993 and Bryant, Mjelde and Lacewell1993). In this paper, a detailed linear programming model is used to explorethe limitations imposed by these constraints and to spell out the potential forPalestinian agriculture.

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Experiments are conducted in which existing constraints onthe amount of available irrigation water are relaxed. In addition, other experimentsexplore the impacts of restrictions on export markets. Although there are noexperiments in which the land constraints are relaxed, the shadow prices onthese constraints in the experiments provide an indication of their severity.

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Constraints on Agricultural Production

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The loss of large stretchesof agricultural land, after 1967, due to land confiscation and closures, andlimitations on water supply and product markets, has led to a substantialdecline in the production of this sector.

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In 1967, Palestinian agricultural production wasalmost identical to Israel's: tomatoes, cucumbers and melons were roughly halfof Israel's crop; plums and grape production were equal to Israel's; andPalestinian production of olives, dates and almonds was higher. At that time,the West Bank exported 80% of the entire vegetable crop it produced, and 45% oftotal fruit production (Hazboun, S., 1986).

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The agricultural sector was hit hard after Israeloccupied the West Bank and Gaza Strip. Thereafter the sector’s contribution toGross Domestic Product (GDP) in the Palestinian Occupied Territories declined.Between 1968/1970 and 1983/1985 the percentage of agricultural contribution tothe overall GDP in the West Bank fell from 37.4-53.5% to 18.5-25.4% (UNCTAD,1990). The labour force employed in this sector has also declined. Between 1969and 1985, the agricultural labour force, as a percentage of the total labourforce, fell from 46 to 27.4% (Kahan, D., 1987).

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There has been a continuous decline in thePalestinian cultivated areas in the West Bank since 1967. In 1965, before theIsraeli occupation, the actual cultivated area was estimated at 2,435 km2(Al-'Aloul, K., 1987). The total area fell to 1,951 km2 in 1980. In1985, the cultivated area reached 1,735 km2, and in 1989, it was1,706 km2 (UNCTAD, 1990). The average of actual cultivated land inthe West Bank, between 1980 and 1994 was 1,707 km2, a reduction by30% of the area cultivated in 1965.

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Marketing of farm products and their distribution tolocal and external markets is one of the major obstacles facing Palestinianfarmers. Throughout the occupation years, selling Palestinian agriculturalproducts within Israel requires special permits to be issued by the Israeliauthorities. Transporting products from north to south in the West Bank hasbecome difficult as well, especially after Israel enforced a closure on EastJerusalem, the main road connecting northern with southern parts of the WestBank. Movement of agricultural products between the West Bank and Gaza Strip isalso subject to Israeli control.

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The Gulf War in 1991 has also severely affectedPalestinian agriculture, since the bulk of exports were previously sent to ArabGulf countries. Palestinian exports to the Gulf States had previously accountedfor approximately $25.4 million per year. As a result of the war, Palestinianexports fell by 14%.

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Israel hasrestricted Palestinian water usage and exploited Palestinian water resourcesafter occupation. Presently, more than 85% of the Palestinian water from theWest Bank aquifers is taken by Israel, accounting for 25.3% of Israel’s waterneeds. Palestinians are also denied their right to utilize water resources fromthe Jordan and Yarmouk Rivers, to which both Israel and Palestine areriparians. West Bank farmers historically used the waters of the Jordan Riverto irrigate their fields, but this source has become quite polluted as Israelis diverting saline water flows from around Lake Tiberias into the lowerJordan. Moreover, Israeli diversions from Lake Tiberias into the National WaterCarrier have reduced the flow considerably, leaving Palestinians downstreamwith little water of low quality.

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In Gaza, the coastal aquifer serves as its mainwater resource. Other Gazan water sources, such as runoff from the Hebronhills, have been diverted for Israeli purposes. The Gaza strip, which housedonly 50,000 people before 1948 is now one of the most densely populated regionsin the world. This is the result of the high levels of forced immigrationfollowing the 1948 and 1967 conflicts, and the high rate of natural populationincrease. Gaza’s coastal aquifer is now suffering from severe saltwaterintrusion.

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With regard to total water consumption, an Israeliuses 1959 cubic meters per year (CM/year), compared to an average Palestinianuse of 238 CM/year.

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Israeli restrictions have drastically limited the irrigationof Palestinian land so that today only 6% of the West Bank land cultivated byPalestinians is under irrigation, the same proportion as in 1967. By contrast,about 70% of the area cultivated by Jewish settlers is irrigated.

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Agricultural Production

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Presently, Palestine is divided into two geographicareas: the West Bank (including East Jerusalem) and the Gaza Strip. Agricultureis the largest sector of the Palestinian economy, generating over 22% of theGross Domestic Product of the West Bank and Gaza and providing employment toover 15% of the population.

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The Palestinian agricultural sector shares thecombined characteristics of both intensive irrigated farming primarily in theGaza Strip, the Jordan Valley and the Northern districts of the West Bank, aswell as the extensive rain-fed farming which is dominant in the West Bankhighlands. Despite the small size of the West Bank and Gaza, these areas enjoy adiversity of climatic regions, which makes it possible to grow almost anything,all year round.

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Agriculture in Palestine isdivided into rain-fed and irrigated cultivation (Figure 1). Rain-fedcultivation forms the largest cultivated area, using 92.7-95.8% of the totalcultivated land. Annual production is generally affected by the dominantclimatic conditions, reflecting substantial variation between the variousyears.

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Cultivation of fruit treesis the major sector of plant production in Palestine. Nearly 97.3% of the fruittrees are cultivated under rain-fed conditions, while the remaining 2.7% areirrigated. Although irrigated fruit trees occupy limited areas, they contributeapproximately 37% to the total fruit tree production (Agricultural Departmentof the West Bank, 1993-1994).

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Olive trees, grapevines,almonds, figs and citrus are the major types of fruit trees planted inPalestine. They occupy 90% of the total fruit tree area and produce 79% oftotal fruit production. Olive trees are the prominent fruit trees throughoutPalestine, covering about 72% of areas devoted to fruit trees and contributingabout 30% of the total fruitproduction. Irrigated olive orchards are mainly located in the Jordan Valleyand Tulkarm district. The area of unproductive olive orchards measures 4,272hectares and makes up approximately 4% of the total fruit tree area.

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Grapevines are the secondmajor fruit crops in the West Bank, with a total area of approximately 7,600hectares and annual production of 43,000 tonnes in 1994. Approximately 68% ofthe total cultivated area of vineyards is found in the Hebron district. Almondtrees occupy the third largest area among cultivated fruit trees, forming 7.1%of the fruit tree area and contributing 2.4% to the fruit production.

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Figure 1: Total Cultivated Areaand Production of Different Cropping Patterns

in the West Bank for the1994 Growing Season

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The area of field crops andforages has significantly decreased from 85,000 hectares in 1966 toapproximately 46,000 hectares in 1994. This decline reflects the majorreduction of field crops in the West Bank.

The total area of fieldcrops varies from one year to another. During the last fifteen years, thelargest area of field crops was in 1990, with 56,492 hectares, while thesmallest was in 1984, with 43,881 hectares. This indicates that there is apotential for at least additional 12,611.5 hectares of field crops that couldbe planted to produce approximately 17 thousand tonnes of different types offield crops (Rural Research Center, 1980-1990; Haddadin, 1993).

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The total cultivated areaunder field crops was estimated at 46,106.1 hectares in 1994. The majority ofthis area (approximately 98.4%) was cultivated under rain-fed conditions whileonly 1.6% was irrigated. Total field crop production was 48,662.5 tonnes forthe same year, of which irrigated field crops contributed 10.1%, (Agricultural Department of the West Bank,1993-1994).

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The potential for field cropdevelopment in the West Bank is greatly limited by productivity, size ofcultivated areas and agro-climatologic factors. The distribution of rainfall,prevailing temperatures, and the occurrence of Khamaseen winds are the main factors influencing the distributionof field crops and annual productivity. These factors also influence farmers’decisions on the type of crop and time of planting.

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In the 1994-growing season,the total area of vegetable crops was approximately 16,000 hectares with atotal production of 212,000 tonnes. The production of vegetable crops is higherthan that of fruit trees or field crops. Also, the areas of rain-fed vegetablesare characterized by fertile soils and good average rainfall (AgriculturalDepartments in the West Bank, 1993-1994).

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More than 30 differentvegetable crops are planted in Palestine. This richness in crop diversitycombined with the variety of possible panting dates greatly improves theproduction of this sector.

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Irrigated vegetables makeabout 42% of the vegetable area. Different irrigation systems used in thecultivation of vegetables in Palestine, namely open irrigated fields,irrigation under low plastic tunnels, under high plastic tunnels, and underplastic houses.

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Although rain-fed vegetablesaccount for the largest area of the total planted vegetables (approximately59%), they contribute only 19% to total vegetable production. The largest areaof rain-fed vegetables is found in Jenin district, followed by Tulkarm, Hebron,Ramallah, Nablus, and Bethlehem.

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Around 20 differentvegetable crops are planted under rain-fed conditions in the West Bank. Themost widespread are dry onions, tomatoes, okra, snake cucumber, squash,cauliflower, and potatoes. Productivity of rain-fed vegetables varies from yearto year, depending on many conditions. The main factors controllingproductivity and the length of the farming season are rainfall and the quantityof last effective rainfall, soil moisture content, soil preparation, andtemperature; especially during the emergence, flowering, and fruit settingstages of plant growth.

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The current total area of irrigated land in the WestBank is 101,615 dunums and the total amount of water used for irrigation is92.94 Million Cubic Meters (MCM). Table 1 shows the total area and productionfor different major plant types in the West Bank in the year 1996.

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Table 1: Total Area and Production for Different MajorTypes Planted in the West Bank in 1996

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Type

Area (1000 dunums)

Production

(1000 tonnes)

Field crops

375.048

49.719

Forage crops

66.369

18.056

Vegetable crops

145.457

256.405

Citrus

18.836

55.977

Unproductive Olive trees

22.545

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Productive Olives

785.428

123.661

Other fruit trees

214.280

107.046

Total

1,627.963

610.864

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Almost 92.7% of the total irrigated areas in theWest Bank are concentrated in the two agro-ecological areas, the semi-coastalregion and the Jordan Valley. Vegetables constitute 67% of the total irrigatedareas in the West Bank. About 65.3% of the vegetables are grown under openfields, 15.8% under low plastic tunnels, 7.5% under high plastic tunnels and11.4% under plastic houses. Fruit trees form about 26.5% of the total irrigatedlands in the West Bank, while field crops constitute 6.5%.

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Agriculture in the South of the West Bank (Bethlehemand Hebron) is mainly rain-fed. There are 375,726 dunums of agricultural land,of which only 1807 dunums are irrigated. Hence, its contribution to the totalirrigated agriculture in the West Bank is 1.8%. As for agricultural water use,the South consumes 0.54 MCM for irrigation, which is 0.6% of the West Banktotal.

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The North of the West Bank (Ramallah, Jenin, Tulkarmand part of Nablus) is quite varied in the types of crops produced. It has goodfertile soil, suitable climate, fair amounts of irrigation water and relativelyhigh annual rainfall. All of these factors contributed to prosperous rain-fedfarming and irrigated agriculture in the North. There are 1,262,637 dunums ofagricultural land, of which 56,088 dunums is irrigated farmland. This makes theNorth’s contribution to the total irrigated agriculture in the West Bank 55.2%.Similarly, the North uses 36.83 MCM for irrigation, which is 39.6% of the totalWest Bank irrigation water.

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The Jordan Valley, including Jericho and part ofNablus, has very hot weather and virtually no rain. As a result, there is norain-fed agriculture in the Jordan Valley and all the farming is based onirrigated cultivation. Thus, all of the 43,700 dunums of agricultural land isirrigated. The Jordan Valley’s contribution to the total irrigated agriculturein the West Bank is 43%. As for agricultural water, 55.57 MCM are used onirrigation, which makes up 59.8% of the total irrigation water in the WestBank.

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In the Gaza Strip, the exploitation level ofresources exceeds the carrying capacity of the environment. This is especiallytrue for the water and land resources. Agricultural expansion in the Gaza Stripseems to have reached its limits. Almost all cultivated land is now underexploitation. Due to economic pressure the last remaining spots of dunes arerapidly being leveled and excavated in order to start intensive horticulture.This process is further accelerated by the loss of agricultural land in sanddune areas to urban expansion. There are 178,186 dunums of agricultural land,representing close to 50% of the total area of the Gaza Strip. Of the total,109,146 dunums are irrigated and 69,040 dunums are rain-fed. Thus irrigatedfarming makes up 61% of the total agricultural area in the Gaza Strip. Table 2 shows the total area and productionfor different plant types in the Gaza Strip in the year 1996.

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Table 2: Total Area and Production for Different PlantedCrops in the Gaza Strip in 1996

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Type

Area (1000 dunums)

Production (1000 tonnes)

Vegetable crops

62.217

260.513

Citrus

43.574

97.192

Other fruit trees

40.450

27.530

Field crops and Forage

33.700

6.500

Total

179.941

385.2

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During the period 1967 through 1995, due to theabsence of a national government in Palestine, a mix of economic and politicalconsiderations shaped Palestinian agricultural practices. In irrigatedagriculture, economic issues forced Palestinians to shift from fruit trees tohigh cash value crops such as vegetables, and more recently flowers. Forinstance, the areas planted in citrus in Gaza declined from 69,200 dunums in1983 to 43,574 dunums in 1996. Palestinian farmers harnessed new agriculturaltechnologies and their production was competitive with that of Israel.Palestinians embarked on promoting the marketing of their produce in Europe andother countries. In rain-fed farming, Palestinians shifted from field crops toolives. The reasons behind that are:

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<![if !supportLists]>·<![endif]>Incomefrom field crops is low compared to income-earning opportunities in Israel

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<![if !supportLists]>·<![endif]>Olivesdo not require a lot of work

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<![if !supportLists]>·<![endif]>Theplanting of olives indicates that the land is cultivated, which protects itfrom the Israeli appetite to confiscate uncultivated land; planting field cropsdoes not provide evidence that the land is cultivated all year round.

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As a result of these factors, Palestine has movedaway from agricultural food security. Palestine became an exporter ofvegetables, olives and citrus and an importer of field crops and limited typesof fruits and vegetables, which are produced in quantities less than theirdemand and/or are not available during certain periods of the year. Table 3shows the balance between production and consumption in Palestine for differentbranches of crop production, while Table 4 shows the quantities andexport-import channels for crop products in Palestine.

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Table 3: The Total Production and Consumption for MajorAgricultural Types in Palestine in 1996

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Production

(1000 tonnes)

Consumption (1000 tonnes)

Surplus or deficit

Vegetables

516.9

645

-128.1

Field crops

35.8

350.3

-314.5

Citrus

153.2

42.2

111.0

Fruits

134.6

154.1

-19.5

Olives

126.1

80.4

45.7

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Table 4: Total Quantities of Exported and ImportedVegetables and Fruits to Palestine (West Bank and Gaza Strip) in 1996

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1000 Tonnes

Export to and/or through

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Total

Imported from Israel

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Jordan

Israel

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Vegetables

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105.1

105.1

192.7

Fruits

62.7

31.5

94.2*

88.6*

Total

62.7

136.6

199.3

281.3

* Without olives

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Palestinians can reduce the food security gap once theyget back the full rights to utilize their land and water resources. Here weexplore the potential of agricultural development in Palestine once the issuesof land and water are solved according to the terms of reference for the peaceprocess, namely UN resolutions 242 and 338. The potential exists for irrigatingan additional 400,000 dunums of land in the Jordan Valley, Tulkarm and Jenin.Another potential lies in building the West Ghour canal, proposed in theJohnston Plan, which once built will alone provide enough water to irrigate atleast an additional 150,000 dunums and create job opportunities for 300,000Palestinian workers.

Optimization models are particularly suitable forexploring the potential for efficient utilization of scarce resources and theimpacts of constraints on this potential. In what follows, we present a linearprogramming model we designed to deal with these issues.

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The Model

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The basic core of the system (named ASAP, Allocation Systemfor Palestinian Agriculture) is the optimal allocation of scarce land andwater. The objective is to maximize total net agricultural profit by choosingthe appropriate crops and the corresponding monthly allocation of the availableland and water. [Monthly allocations of water which correspond to the patternof water use for each crop, allow different crop seasons for the same crop, andallow multiple cropping in the same year.] The availability of these resourcesis not the only constraint. Equally important are the available irrigationtechnologies, water distribution infrastructure, soil types, the costs of otherinputs and the market constraints that define the potential demands forPalestinian crops.

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The allocation model is a linear programming model. The modelspecifies an objective function to be maximized and a set of constraints thatmust be satisfied. The set of constraints includes the land and waterconstraints, technological constraints and boundary conditions that set upperlimits on key variables of the model. Similar models have been used by Lacewellet. al. (1982). The model ignores issues of risk raised in Bryant, Mjelde andLacewell (1993), as well as optimal choice of irrigation method for each crop,basing monthly irrigation water use per dunum for each crop on actualPalestinian irrigation practice.

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There is no labour constraint in the model, as Palestine is alabour abundant region. Labour costs are reflected in the objective function.Irrigation requirements are based on actual Palestinian practice. Improvementsin irrigation technology or water infrastructure could be incorporated in themodel, but these experiments are not reported here. Finally, the model isessentially static, allocating irrigation water and land over 12 months in asingle year.

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We begin with a general discussion of the mathematicalequations of the model and the way they are organized within ASAP. Variablesare defined and the constraints are specified for each of the separatedistricts of Palestine. The model at this stage is defined for the West Bankdistricts only. It is only a simple matter to expand it to include the GazaStrip. (A complete description of the model can be found in the ASAPdocumentation: the Technical ReferenceManual, the ASAP User’s Guide andthe Data Reference Manual.)

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Variables:

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The agricultural sector of each region jpotentially operates crop activities i’, where each activity produces a singlecrop i, in a crop season unique to i’, using a particular soil type p, and aparticular irrigation system s. The output of each activity Xji’, ismeasured in tonnes per year. Months are indexed by m (=1,…,12). For exports ofwater and crops between districts, r is used as the index for the receivingdistrict.

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Each crop activity, ji’, uses land of soiltype p during the crop season. The land used in month m equals

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<![if !vml]>Agriculture in Palestine (2)<![endif]> (dunums)

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where <![if !vml]>Agriculture in Palestine (3)<![endif]>= <![if !vml]>Agriculture in Palestine (4)<![endif]>

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Some crop activities ji’ also use irrigationwater during the crop season. For these activities the irrigation water used inmonth m equals

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<![if !vml]>Agriculture in Palestine (5)<![endif]>(m3)

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where <![if !vml]>Agriculture in Palestine (6)<![endif]>= <![if !vml]>Agriculture in Palestine (7)<![endif]>

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Note that <![if !vml]>Agriculture in Palestine (8)<![endif]>differs from month to month to reflect the pattern of wateruse during the crop season.

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Crops can be exported to other districts. Theexport of crop i from district j to district r equals

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<![if !vml]>Agriculture in Palestine (9)<![endif]>(tonnes), <![if !vml]>Agriculture in Palestine (10)<![endif]>

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Crops can also be exported to or importedfrom abroad. The export of crop i from region j to abroad equals

<![if !vml]>Agriculture in Palestine (11)<![endif]>(tonnes)

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and the import of crop i from abroad toregion j equals

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<![if !vml]>Agriculture in Palestine (12)<![endif]>(tonnes)

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Irrigation water can also be exported toother districts. The export of irrigation water from district j to district rin month m equals

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<![if !vml]>Agriculture in Palestine (13)<![endif]>(m3)

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Irrigation water can also be exported to, orimported from, abroad (The National Water Authority). Exports and imports ofirrigation water to/from abroad in month m equal

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<![if !vml]>Agriculture in Palestine (14)<![endif]>(m3)

<![if !vml]>Agriculture in Palestine (15)<![endif]>(m3)

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Objective Function:

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The model chooses the levels of cropactivities in each district, Xji’, exports of crops from onedistrict to another, ECjri (r ¹ j), net exports of cropsfrom each district to abroad, NECFji , exports of water from onedistrict to another, EWjrm (r ¹ j), exports of water toabroad, EWFjm and imports of water from abroad, MWFjm, inorder to maximize total profit from agriculture adjusted for the costs oftransporting water and crops between districts and between districts andabroad:

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TP = <![if !vml]>Agriculture in Palestine (16)<![endif]>

<![if !vml]>Agriculture in Palestine (17)<![endif]>

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where<![if !vml]>Agriculture in Palestine (18)<![endif]>is the net profit perunit of output of crop i’ in region j (JD/tonne),

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Pji’ is the priceof crop i’ in region j (JD/tonne),

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Pjk is the is theprice of purchased input k in region j,

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Cji’k is therequirement for input k per unit of output of crop i’ in region j)

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cwjr is the costof transporting one unit of water from region j to region r (<![if !vml]>Agriculture in Palestine (19)<![endif]>) (JD/m3)

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cwjf is the costof transporting one unit of water from region j to abroad

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cwfjis the cost of transporting one unit of water from abroad to region j

ccjriis the cost of transporting one tonne of crop i from region j to region r

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and ccjfi is the cost of exportingor importing one tonne of crop i between region j and abroad

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Constraints:

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There are seven types of constraints:

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  • Commoditybalances
  • Landbalances
  • Waterbalances
  • Waterallocation equations
  • Watertransport capacity constraints
  • CommodityExport constraints
  • CommodityImport constraints

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The commodity balances state that consumptionneeds for commodity i in district j, <![if !vml]>Agriculture in Palestine (20)<![endif]>must be met, eitherby production in the district or by imports from other districts and abroad.Any surplus of the commodity can be exported to other districts or abroad.

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for each (j,i): <![if !vml]>Agriculture in Palestine (21)<![endif]>

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The land balances state that the use of landin district j of soil type p in month m cannot exceed the available land ofthat type, <![if !vml]>Agriculture in Palestine (22)<![endif]>

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for each (j,p,m): <![if !vml]>Agriculture in Palestine (23)<![endif]>

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The water balances state that the use ofirrigation water in district j and month m cannot exceed the water availablefrom sources within the region, from import from other districts or fromabroad.

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for each (j,m): <![if !vml]>Agriculture in Palestine (24)<![endif]>

Note that <![if !vml]>Agriculture in Palestine (25)<![endif]>equals zero forrain-fed crops.

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There are two types of water allocationequations. The first allocates the supply of irrigation water originating withinthe district across months. This constraint implicitly assumes perfect storagecapability. It was used because the monthly distribution of the supply ofirrigation water originating within the district was not known.

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for each j: <![if !vml]>Agriculture in Palestine (26)<![endif]>

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The second water allocation equationallocates the total amount of water available from abroad (the National WaterAuthority) to the districts and across months.

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<![if !vml]>Agriculture in Palestine (27)<![endif]>

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The water transport capacity constraintsreflect the physical limits imposed by the water transport infrastructure.

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for each (j,r,m): <![if !vml]>Agriculture in Palestine (28)<![endif]>

for each (j, m): <![if !vml]>Agriculture in Palestine (29)<![endif]>

for each (j, m): <![if !vml]>Agriculture in Palestine (30)<![endif]>

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The commodity export constraints reflectaccess to world markets and the ability of these markets to absorb Palestinianexports.

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For each (i): <![if !vml]>Agriculture in Palestine (31)<![endif]>

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The commodity import constraints reflect theability to import.

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For each (i): <![if !vml]>Agriculture in Palestine (32)<![endif]>

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Data Selection and Structure

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The fact that ASAP is designed to serve as an integratedmodel for the optimization of use of land and water resources in agriculturenecessitates that this model be based on a wide spectrum of relevant data. Thisdata combines factors such as crop types, climate, crop production anddistribution, consumption, cultivation method, irrigation technology,agricultural markets, prices of produce, cost of production, net export/import,water availability, population growth and distribution, availability of land,soil type, and others.

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The ability of this system to integrate and analyzethese multiple sets of data generated a useful model for Palestine that iscapable of exploring policies and projections regarding critical issues in thefield of agriculture and related uses of water and land. It is also capable ofsimulating scenarios to predict the consequences of certain agricultural anddevelopment policies on agricultural revenues, food security, land and water.It also allows the introduction of sets of limitations on the agriculturalsystem in Palestine such as curfews, closure of communities, and closure ofinternational terminals. The data structure is described below.

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Data Description andLimitations

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Figure 2 shows the sets of data included in themodel.

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Crops

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Data on 49 major crops in the West Bank and GazaStrip were used in the model. These crops represent the majority ofagricultural produce and the various crop types of vegetables, field crops andfruit trees (Table 5). This set of datacomprises the primary data of ASAP to which all other data were related.

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Table 5: Field Crops and Fruit Trees

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Vegetables

Field Crops

Fruit Trees

Broad beans

Parsley

Wheat

Almond

Cabbage

Peas

Barley

Apple

Carrot

Pepper

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Apricot

Cauliflower

Potatoes

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Avocado

Corn (sweet)

Pumpkins

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Banana

Cowpeas

Radish

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Citrus

Cucumber

Snake cucumber

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Date Palm

Eggplant

Spinach

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Figs

Garlic

Squash

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Guava

Jews Mellow

Sugar Beet

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Loquat

Lettuce

Thyme

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Nuts

Musk Melon

Tomatoes

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Olives

Okra

Turnip

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Peach

Onion

Water melon

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Pear

Beans

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Plum

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Pomegranates

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Quince

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Vines

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Data gathered on each crop include:

1-Cultivated Areas

The measurement unit of the data item is the dunum(1 dunum = 0.1 hectare). Information on crop areas was taken from statisticaldata compiled by various directorates of the Palestinian Ministry ofAgriculture (PMA). The data was classified by district, cultivation season,soil type, and cultivation method. For irrigated vegetables and field crops,the planting date was the identifier of the cropping season. For fruit trees,as most are perennials, harvesting time was the identifier of the croppingseason. The following tables show the classification scheme of the irrigatedcrops by seasons; that is for each crop and irrigation method, they show the plantingand harvesting months. For convenience, the crop activities have been allocatedto seasons.

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Table 6: Classification Scheme for Crops by Season
For All Districts Except Jericho

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Crop type

Fall

Spring

Summer

Beans

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12-6 (P)

3-7 (O)

Broad beans

10-2 (O)

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Carrot

11-5 (O)

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Cauliflower

10-2 (O)

12-4 (O)

3-6 (O)

Cowpeas

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1-6 (T)

3-7 (O)

Cucumber

11-6 (P)

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3-8 (O)

Eggplant

10-6(O)

1-6 (T)

1-7 (P)

3-8 (O)

Jews Mellow

8-11 (O)

12-4 (P)

4-8 (O)

Lettuce

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12-2 (O)

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Musk Melon

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3-7 (O)

Okra

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3-7 (O)

Onion

9-4 (O)

12-4 (O) / 2-6 (O)

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Pepper

8-6 (P)

12-6 (P)

3-7(O)

Potatoes

8-2 (O)

12-4 (O) / 2-6 (O)

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Pumpkins

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5-11 (O)

Radish

11-2 (O)

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Spinach

8-12 (O)

1-4 (O)

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Squash

10-3 (O)

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3-7 (O)

Sugar Beets

9-12 (O)

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Thyme

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2

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Tomatoes

9-6 (P)

1-6 (T) / 2-6 (O)

3-7 (O)

Turnip

11-2 (O)

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Water Melon

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3-7 (O)

O = Open Field Irrigated T = Tunnels (Low and High) P = Plastic houses

Season Months Fall 9, 10, 11Spring 12, 1, 2 Summer 3, 4, 5, 6, 7, 8

Table 7: Classification Scheme for Crops by Season
For Jericho

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Crop type

Fall

Spring

Summer

Beans

10-2 (O)

12-5 (O)

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Broad beans

10-3 (O)

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Cabbage

9-1 (O)

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Carrot

11-5 (O)

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Cauliflower

9-1 (O)

12-4 (O)

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Corn

8-12 (O)

12-4 (O)

3-6 (O)

Cowpeas

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2-5 (O)

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Cucumber

9-1 (O) / 9-6 (P)

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Eggplant

9-6 (O)

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Jews Mellow

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2-5 (O)

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Lettuce

11-2 (O)

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Musk Melon

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3-7 (O)

Okra

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2-6 (O)

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Onion

9-4 (O)

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Pepper

9-6 (P) / 9-8 (P)

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Potatoes

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12-5 (O)

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Pumpkins

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1-6 (O)

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Radish

11-2 (O)

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Snake Cucumber

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2-5 (O)

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Spinach

8-12 (O)

1-4 (O)

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Squash

9-12 (O)

12-4 (O)

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Sugar Beets

9-12 (O)

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Thyme

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2

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Tomatoes

9-3 (O) / 11-4 (T) /

9-5 (O)

1-5 (O)

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Turnip

11-2 (O)

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Water Melon

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3-6 (O)

Wheat

11-5 (O)

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Barley

11-4 (O)

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O = Open Field Irrigated T= Tunnels (Low and High) P =Plastic houses

Season Months Fall 9, 10, 11Spring 12, 1, 2 Summer 3, 4, 5, 6, 7, 8

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Rain-fed field crops in Palestine are all plantedduring the fall. Rain-fed vegetables are mostly planted in the summer period,starting in early March.

2- Crop Yield

Measured in kilograms per dunum, the average yieldof each crop was estimated based on field surveys and statistics collected bythe various directorates of the Palestinian Ministry of Agriculture. Crop yielddifferences among the various types of cultivation were incorporated in themodel. Thus, yield for the same crop is different for plastic houses, rain-fedcultivation, open field irrigated cultivation, and low and high plastictunnels. Although crop yield tends to vary with soil quality and seasonvariation in the same cultivation type, the quantification of these variationsis difficult, and thus they were neglected.

3- CropPrices

These are measured in Jordanian Dinars per kilogramof crop. The average currency exchange were based on 1995 rates and is equal to1 JD = 4.28 NIS. This information was obtained from various sources, includingfield survey, statistics compiled by the Palestinian Central Bureau ofStatistics and the Palestinian Ministry of Agriculture. The compiled pricesrepresent the market price of each crop rather than farm-gate prices. Althoughfarm gate prices are better reflectors of farmers’ income and net revenue, thisinformation was not available. Monthly crop prices were included in the modelas great variation exists in market prices during the year.

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4- CropWater Requirement

These are measured in cubic meters per dunum ofcrop. The values of crop water requirement were calculated based on real datataken from the field. Cropwat software was used to generate the crop waterrequirement values for each crop. The values were different for each month inthe crop season, soil type, and cultivation method. In calculating waterrequirements, the following factors were taken into consideration:

<![if !supportLists]>·<![endif]>microclimate- precipitation, solar radiation, evaporation, humidity, and wind speed

<![if !supportLists]>·<![endif]>soiltype - clay, clay loam, and sandy loam

<![if !supportLists]>·<![endif]>efficiencyof irrigation method

<![if !supportLists]>·<![endif]>croptype - 48 crops

<![if !supportLists]>·<![endif]>Cultivationtype - open field irrigated, plastic houses, rain-fed, low and high plastictunnels

<![if !supportLists]>·<![endif]>growingseason and duration

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5- Cost ofProduction

Cost of production for each crop, measured inJordanian Dinars per dunum, was divided into four main categories: chemicals,raw material, labour, and other. The category of chemicals includesfertilizers, pesticides, and herbicides. Raw material includes tools, plasticcovers, irrigation pipes, and depreciation of plastic houses and irrigationsystems. Labour cost was calculated according to work hours per job. Othercosts include farming processes (other than labour) such as plowing,harvesting, seed sowing and other relevant operations.

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The variation in the cost of production of cropsplanted on different soil types is minimal and thus was neglected.

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6- CropConsumption

Measured by tonnes per district, the estimation ofcrop consumption per district was generated from food basket data provided bythe Palestinian Central Bureau of Statistics (PCBS). The total value (in NIS)of money spent by family unit on each crop was divided by the average familysize and divided by the average crop price (NIS/tonne) in each district. Toobtain the total crop consumption in each district, the generated per capitacrop consumption (in tonnes) was multiplied by population size.

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Soil Type Distribution

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As for the distribution of the prevailing soil typesin each district of Palestine, the ASAP team utilized GIS technology availableat ARIJ. Information on the size and geographical distribution of currentagricultural and reclaimable lands were obtained from the analysis of aerial photos,satellite images, and existing land use maps. Information obtained from thesesources were entered into the GIS as individual coordinates (informationlayers) and overlaid with soil distribution coverage. The soil distribution andclassification were obtained from a soil map of 1:250,000 for the West Bank andthe Gaza Strip.

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Results

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Mathematical programming models are well suited for exploringthe limitations on production imposed by economic, political and physicalconstraints. These models are also useful in estimating the potential benefitto a sector of using additional scarce resources. Three experiments werecarried out with the model and were used to estimate the limitations imposed bywater and export markets on West Bank agriculture. In order to provide areference, the first experiment assumed unlimited amounts of irrigation waterfrom the National Water Carrier (NWC) as well as unlimited exports at fixedexisting prices. The results are still constrained by cultivable land andexisting water transport infrastructure within the West Bank. The secondexperiment constrains the amount of irrigation water to 92 MCM, the amount ofwater presently available from local Palestinian sources. (The amount availablefrom NWC was set to zero.) The third experiment assumed unlimited water fromNWC but limited crop exports. Limitingcrop exports to existing levels would force the solution to replicate thepresent pattern of production. Instead,limits of one million tonnes were placed on the export of each crop. These limits were significantly less thanthe exports of over two million tonnes which were reached for two crops in theunconstrained experiment, but still large enough to allow the solution todeviate from the existing pattern of production.

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The Unconstrained Experiment

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In the unconstrained experiment, the maximum net agriculturalprofit amounts to J.D 4.24 billion. In this experiment 405 MCM of water wasimported from the NWC. Total agricultural production was 7,765,050 tonnes.Crops were highly specialized with only a few crops being produced.

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Crop exports totaled 7,691,620 tonnes. The overwhelmingproportion of each crop was exported with the exception of figs, which weremainly consumed in the domestic market. Details of crop production and exportsare shown in Table 8 below.

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Table 8:Optimal Crop Production and Exports

(UnconstrainedExperiment)

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Crop

PRODUCTION (000,TONNES)

EXPORTS (000,TONNES)

CAULIFLOWER

780

770

CUCUMBER

2,373

2,355

JEWS MELLOW

319

317

OKRA

140

139

PEPPER

1,396

1,395

SPINACH

59

58

TOMATOES

252

223

TURNIP

2,434

2,433

FIGS

13

2

TOTAL

7,765

7,691

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Since water imports from the NWC were not constrained, theshadow prices of irrigation water in each district equaled the cost oftransporting irrigation water to the district. Shadow prices of the varioussoil types of land in each district were large, ranging from JD 1,505 per yearin Hebron to JD 8,706 per year in Tulkarm. Thus, if irrigation water wasabundant, land would be the significant factor limiting agriculture inPalestine.

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The Constrained Water Experiment

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In the constrained water experiment, the maximized netagricultural profits fell to J.D 3.08 billion, a drop of JD 1.16 billion. Inthis experiment less cultivable land was used than in the unconstrainedexperiment because no water was allowed to be imported from the NWC. As aresult, total agricultural production fell to almost one half of what it was inthe unconstrained experiment (3,804,322 tonnes). Crops were even more highlyspecialized, with even fewer crops being produced and exported (see Table 9).The dominant crop is turnips, suggesting that this crop uses water mostefficiently.

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Crop exports totaled 3,784,235 tonnes. The overwhelmingproportion of each crop was exported with the exception of figs and cucumbers,which were mainly consumed in the domestic market. Details of crop productionand exports are shown in Table 9 below.

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Table 9:Optimal Crop Production and Exports

(ConstrainedWater Experiment)

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Crop

PRODUCTION (000, TONNES)

EXPORTS (000, TONNES)

CUCUMBER

3

MUSK MELON

130

128

OKRA

199

198

PEPPER

783

782

TURNIP

2,674

2,673

FIGS

13

2

TOTAL

3,803

3,784

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When water was constrained, the shadow price of water fromthe NWC rose to J.D 8.57 per cubic meter. The shadow prices of land fell,ranging from J.D 958 per year in Bethlehem to a high of J.D 5,173 per year inJenin. Thus, although the water constraint reduced the amount of land used insome months in some districts, land was still fully utilized in many months inmany districts.

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The Constrained Market Experiment

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In the constrained market experiment, the net agriculturalprofits were JD 0.96 billion lower than in the unconstrained experiment, butsomewhat higher than in the constrained water experiment, at J.D 3.28 billion.In this experiment all cultivable land was used during the crop seasons andover 384 MCM of water was imported from the NWC. Total agricultural production(7,142,888 tonnes) was slightly lower than in the unconstrained experiment, butconsiderably higher than in the constrained water experiment. This suggeststhat the water constraint is a far more binding constraint than the marketconstraints on commodity exports. Again, crops were more highly specialized andwith fewer crops being produced and exported (see Table 10) than in theunconstrained experiment.

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Crop exports totaled 7,063 tonnes. The overwhelmingproportion of each crop was exported with the exception of figs and tomatoes,which were mainly consumed in the domestic market. Details of crop productionand exports are shown in Table 10.

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When commodity exports were constrained and irrigation waterunconstrained, the shadow price of water from the NWC fell to J.D 0 per cubicmeter. Land had shadow prices that ranged from J.D 671 per year in Hebron to ahigh of J.D 5,443 per year in Jericho. The market constraint ultimatelyincreased the amount of land used for production, since production of moreprofitable crops gave way to production of less profitable crops which requiremore land per tonne of output. The production of the most profitable crops wasexactly equal to local consumption plus the export limit imposed (1 milliontonnes per crop).

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Table 10:Optimal Crop Production and Exports

(ConstrainedMarkets Experiment)

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Crop

PRODUCTION (000, TONNES)

EXPORTS (000, TONNES)

CABBAGE

1,005

1,000

CAULIFLOWER

780

770

CUCUMBER

1,018

1,000

JEWS MELLOW

993

991

LETTUCE

848

846

OKRA

174

173

PEPPER

1,001

1,000

SPINACH

59

58

TOMATOES

252

223

TURNIP

1,001

1,000

FIGS

13

2

TOTAL

7,143

7,063

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Conclusions

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Both water and export markets place major limits onagriculture in the Palestinian West Bank. When water is made available inabundance and when markets (exports) are not constrained, Palestinianagricultural production expands greatly. A total of 405 MCM of water is neededin addition to what is available now in order to realize the full potential ofPalestinian agriculture, based on present irrigation technology, existing watertransportation infrastructure, the present amount of available agriculturalland, and unlimited export markets. Israeli control over Palestinian water is amajor constraint on Palestinian agriculture. This is all the more important inview of the fact that agriculture in Israel contributes less than 2% to its GDP.By way of contrast, agricultural expansion can contribute to a majorrevitalization of the Palestinian economy through higher exports and income.

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Restricted export markets also severely limit Palestinianagriculture. The experiments show this in two ways. First, in the constrainedwater experiment, commodity exports are not limited. Thus, this experiment canalso be viewed as an unconstrained exports experiment. The results suggest thateven with water limited to present levels, agriculture output could be muchgreater than present levels if export constraints were lifted. Second, theresults of the constrained export experiment suggest that with unlimited water,even modest export constraints significantly reduce agricultural production andincome.

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Together, water and export constraints hold Palestinianagricultural output and profit far below their potential. They forcePalestinian agriculture to produce a large array of crops, when both output andprofit would be much larger if production were specialized in a smaller set ofcrops which made more efficient use of available water and land.

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Although no experiments were conducted in which the landconstraint was varied, land was a constraining factor in all three experiments.Greater availability of water and export markets led to a higher implied value(shadow price) of agricultural land. The model as it stands now, is not suitedto investigate common access problems to a common aquifer. Thus, this issue wasnot addressed.

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The results argue for a much higher value for water than istypically generated by other models. It is only when the contested water ismade available to the Palestinians that water shadow prices decline. When nowater is made available to the Palestinians from the Israeli National WaterCarrier, the shadow price of water or the scarcity rent of water is JD 8.57(about USD13) per cubic meter. This suggests that the marginal value product ofa cubic meter of water in Palestinian agriculture is very high indeed. ThePalestinians can productively use any additional water they can claim back fromIsrael. Peace will be built more firmly on solid economic grounds when thePalestinian economy is anchored on a viable and productive agriculture base.This base requires more water and better access to Israeli and world markets.

References

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Agricultural Department ofthe West Bank (1994). Records of Agricultural Statistics on Plant Productionand Livestock Production for the West Bank for 1993/1994 Growing Season.

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Al-'Aloul, K., (1987). “APlan Proposal for Afforestation and Land Reclamation in the West Bank”. Arab Thought Forum, Jerusalem.

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Berck Peter and Jonathan Lipow, (November 1994).“Real and Ideal water Rights: The Prospects for water Rights Reform in Israel,Gaza and the West Bank.” Resource andEnergy Economics, 16, PP. 287-301.

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Bogess William, Ronald Lacewell and David Zilberman,(1993). “Economics of Water Use in Agriculture.” in Gerald A. Carlson (ed;). Agricultural and Environmental ResourceEconomics. (Oxford: Oxford University Press), PP. 319-91.

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Bryant,Kelly J., James W. Mjelde and Ronald D.Lacewell, (November 1993). “An Intraseasonal Dynamic Optimization Model toallocate Irrigation Water Between Crops” AmericanJournal of Agricultural Economics, 75 (4), PP. 1021-29.

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Dinar Ariel and Aaron Wolf, (October 1994a).:International Markets for water and the Potential for Regional Cooperation:Economic and Political Perspectives in the Western Middle East.” Economic Development and Cultural Change.43 (1), PP. 43-66.

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Dinar Ariel and Aaron Wolf, (November 1994b).“Economic Potential and Political Considerations of Regional Water Trade: TheWestern Middle East Example” Resource andEnergy Economics, 16, PP. 335-356.

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Haddadin, M., (1993).“Jordan River Basin Study Part II, The West Bank”, submitted to the International Bank for Reconstructional Development(IBRD)

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Hazboun, S., (1986). “Continuous Destruction ofAgriculture in the Occupied Territories”, Al-Katib Journal, no.97, p. 45.

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Toren, B., and Katz, J.,. “Possibilities for Industrialand Entrepreneurial Development in the West Bank & Gaza Strip”. The Jerusalem Institute for Israel Studies.

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Kahan, D., (1987). “Agriculture and Water Resourcesin the West Bank and Gaza (1968-1987). TheWest Bank Data Base Project, Jerusalem.

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Lacewell, R.D., D.C. Hardin,J.A. Petty and R.E. Whitson. (1982). “Economic Effect of Energy Price andEconomic Feasibility and Potential of New Technology and Improved Managementfor Irrigation in Texas”. TWRI Technical Report.

Rural Research Center, (1980-1990); “AgriculturalStatistical Bulletin for the West Bank and Gaza Strip”, Volumes 1-9, Al- Najah University, Nablus.

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UNCTAD, (1990).“The Latest Agricultural Development in the Occupied Palestinian Land”, Geneva, October,( In Arabic)

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UNCTAD, (1990). “Recent Economic Development in theOccupied Palestinian Territory” TD/B/1266,Geneva.

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Wolf Aaron, (Summer 1993). “Water for Peace in theJordan River Watershed.” NaturalResources Journal. 33 (3), PP. 797-839.

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Wolf Aaron and John Ross, (Fall 1992). “The Impactof Scarce Water Resources on the Arab Israeli Conflict.” Natural Resources Journal. 32 (4), PP. 919-958.

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Yaron Dan (November 1994). “An Approach to theProblem of water Allocation to Israel and the Palestinian Entity.” Resource and Energy Economics. 16,PP. 271-286.

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