Economic implications of high dollar exchange rates on agricultural machinery prices of some of strategic crops in Egypt

Abstract

Farmers have borne much of the financial burden in order to increase per feddan productivity of agricultural crops, they have been surprised by the decision to liberalize the exchange rate, which have led to higher costs for most production processes. The research is aimed at identifying the effects of the decision to liberalize the exchange rate on the prices of tractors and agricultural machinery, the items of production costs. The results indicated that The exchange rate has increased at a rate of 12.7%, while machinery prices have increased at rates of 5 - 17%, while production costs for wheat and maize crops have increased by 13%, and 11.8% . On the other hand, the yield to both harvests by a farmer (2011-2020) decreases by rate of about 4% for wheat, and by a rate of about 0.9% for maize. The productivity of wheat and maize in old lands is higher than in new lands, while the opposite occurs in the prices of machinery work to prepare the land for cultivation. An analysis of cost-item values concluded that all production of wheat and maize crops increased after the decision to liberalize the exchange rate by 86%, 91.7%.