Agricultural Prices

Agricultural Prices

The Agricultural Economy Division implements the above survey periodically every month by studying the prices of various agricultural crops to calculate farm gate price which is considered to be one of the most important tools for determining the size of the yield.

The division also studies the marketing costs (packaging, loading, transport and market expenses), which reduce the size of this yield which are usually high (sometimes they may reach more than quarter of the sale prices in the central markets). This study helps to pinpoint the reasons for high costs; therefore suitable decisions are taken to reduce the cots size.

In addition to the above, the division calculates the purchase prices of agricultural production inputs such as pesticides, treatments, organic and chemical fertilizers, seeds and seedlings.

It is noteworthy that the Agricultural Economy Division has reviewed the collection methodology of agricultural prices by a specialized technical committee from the Department of Statistics (DoS) and the Ministry of Agriculture based on the recommendations of the Standing Committee of Agricultural Statistics formed by virtue of the National Agricultural Strategy (2002-2010). In order to improve the data quality, we have depended on the agricultural price data of all agricultural crops from the central markets monthly and collected data on production inputs on annual basis. We have also collected data on marketing costs bi-annually.

Agricultural prices are considered to be the most important economic indicators in Jordan because they are used in a wide variety of fields in the national economy, such as internal and external trade transactions, distribution of economic resources between different sectors, development of long-term agricultural policies and analysis of the current agricultural situation.
As agricultural prices play a major role in the patterns and trends of trade, therefore Jordan uses these prices and the mechanism of their changes in drafting economic policies for the agricultural sector. Jordan also relies on agricultural price indices to determine the mechanism of agricultural dependence of farmers to distribute their various agricultural crops.
This methodology covers various stages of the survey (starting with the preparatory stage, field work, data-processing, extracting the results and finally printing the publication).

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2 – Purposes of Agricultural Prices:
A. Estimating the farm prices (farm gate) of different agricultural products through price data of the central markets (central market prices).
B. Estimating the marketing costs (packaging, loading, transport and marketing expenses) incurred by the farmer due to sale of his products in the wholesale markets or in the central markets or on the farm itself, in addition to estimating the relative weight represented by the components of these costs.
C. Estimating the average prices of production inputs (seedlings, seeds, organic and chemical fertilizers, pesticides and agricultural treatments) during the year.
D. Estimating the share of different marketing places (whether wholesale markets, central markets, the farm itself land or nearby) of the total quantities sold.

3 – Sources of Agricultural Prices:
– Administrative Records: The data is received from the Ministry of Agriculture / Agricultural Marketing Department of the three Central Markets (Amman, Irbid and Zarqa).
– Survey of the Crop Production Requirements.
– Survey of Marketing Costs.

The Preparatory Stage:
It is considered to be the most important stage in the statistical work. It includes:
– The technical staff of our Division prepares the data sheets covering the quantities and prices of agricultural crops issued by the Ministry of Agriculture / Agricultural Marketing Department for the three Central Markets (Amman, Irbid, Zarqa) and prices of field crops from the Cost of Living and Prices Division at the (DoS).
– Designing and selecting a representative sample of agricultural crops by production regions (Jordan valley and highlands) and preparing lists through the marketing costs of agricultural crops’ questionnaire.
– Reviewing the Production Requirements Questionnaire and preparing the lists of the production requirements prices (seedlings, seeds, organic & chemical fertilizers and pesticides) received from various technical directorates of the Ministry of Agriculture.
– Selecting, training and identifying work areas of the staff.
4 – Time Reference:
– Agricultural crops: We obtain the data in the second half of each month.
– Marketing costs: Through a bi-annual survey.
– Agricultural Production Requirements: Through an annual survey at the beginning of each year.

Methods and Standards:
Agricultural crops:
We rely on the administrative records of the three central markets (Amman, Irbid and Zarqa) in the Ministry of Agriculture / Agricultural Marketing Department to obtain the agricultural price data for all agricultural crops monthly. We also rely on the wholesale price of local crops provided by the Cost of Living and Prices Division at the department of Statistics (DoS) and the quantities from the Crops Production Directorate in the Ministry of Agriculture for wheat and barley.

Marketing Costs:
The Regular Stratified Sampling Method was used. The Jordan Valley region was divided into four strata. Each stratum represents a district. Then, a sample of each stratum size; 3% of the holdings in that stratum) was withdrawn. The Cluster Sampling Method was used in the highlands for the irrigated and non-irrigated villages where the irrigated villages were divided into clusters, each cluster is made up of two irrigated villages, then a sample of two clusters was drawn in each governorate. After that, a frame was prepared for the agricultural holdings in each cluster. The frame included the area of each crop planted in the holding. Then, a sample of 30 holdings in each cluster was withdrawn in the second stage covering all major crops in the area. If not all crops are covered by the sample, additional holdings from the same or both clusters are included.
Agricultural Production Requirements:
We coordinate with the Ministry of Agriculture to adopt a mechanism to cover all agricultural production requirements through an annual survey at the end of each year or through a representative sample.

Study Comprehensiveness:
Agricultural Crops:
They include all agricultural crops received in the three central markets by the various production areas in the Kingdom and all field crops provided by the Cost of Living and Prices Division.
Marketing Costs:
It is done by covering the cost of agricultural crops through a bi-annual survey.
Agricultural Production Requirements:
We will coordinate with the Ministry of Agriculture to adopt a mechanism to cover all agricultural production requirements through an annual survey at the end of each year.

Key Documents of the Study:
Agricultural Crops:
From the lists of the administrative records received from the Ministry of Agriculture and from the Cost of Living and Prices Division.
Marketing Costs:
Marketing costs include:
First: Cost of packaging, transport and loading: Its data will be obtained through a questionnaire covering data on the marketing costs incurred by the farmer.
Second: Market costs (market fee and broker fee): Its data is obtained through the administrative records of the three central markets (i.e., the fees determined by the management of the three central markets (Amman, Irbid, Zarqa).
Agricultural Production Requirements:
A questionnaire that includes data on the purchase of production inputs ( i.e., type of input, type of package, weight and price of the package) for both the chemical and organic fertilizers, pesticides, agricultural treatments, seeds and seedlings.
Instruction Manual and Edit Rules:
A manual concerning marketing costs and production requirements has been prepared. It contains a detailed explanation of all data of the questionnaire. It also covers the correct instructions and rules that should be followed when collecting data and checking the questionnaire.
Coding Manual:
A coding manual containing codes of all items in the questionnaire has been compiled to facilitate data entry. We have relied on the CPC2 in preparing these codes.

DEFINITIONS AND TERMS:
1) Agricultural Prices: It means the exchange value of the agricultural products expressed in monetary units (Fils / Kilogram).The agricultural prices used in this survey are the prices of the central markets, wholesale prices, farm gate and near the farm locations.
2) Farm Gate Prices: It means the price obtained by the farmer in return for the agricultural products delivered at farm gate whether this price is actual (i.e., the farmer has actually sold his products in the farm) or theoretical price (obtained by deducting all marketing costs incurred on the process of transporting it to the first sale point outside the farm).
3) Price Near Farm Land: There may be sales close to farmland such as selling on the public roads. The prices of these sales have been called prices near farmland. This type of price can be considered as farm gate prices due to the low or no costs incurred by the farmer as a result of transporting his products to the public road (or close to the farm).
4) Wholesale Prices: It means the prices of agricultural products that are resold either to other wholesalers or to retailers.
5) Central Markets: It means the place where farmers (or sellers) meet with buyers to carry out the sale and purchase operations. Most quantities are sold in these markets to retailers. But other quantities are sold to wholesalers, especially in the ARDHA market. The ARDHA market has been considered as one of the central markets for purposes of this survey.
6) Central Market Prices: Generally, there are three types of prices in the central markets:
1 – Sales’ prices by agricultural producers to retailers.
2 – Sales’ prices of these agricultural producers to wholesalers.
3 – Wholesale prices: the resale prices of some of the purchases made by the traders from a central market (especially the ARDHA) in another central market. The central market prices are the assumed average of these three types of prices.
• Market Fee: It means the amount incurred by the farmer (agricultural holder) for selling his products in the central markets or wholesale markets to the market management.
• Mediator: The person or entity competent to conduct and facilitate the sale and purchase operations in the central markets or wholesale markets.
• Mediator Fee: It is the amount received by the mediator from the farmer in exchange for organizing and conducting sales in the central markets and wholesale markets.
• Market Expenses: They mean the costs incurred by farmers in the central markets (including retail and wholesale) as a result of selling his products in these markets. They include mediator’s fee and market fee (a percentage of the sale price in central markets and often are fixed). They also include any costs that may arise during this stage.

7) Marketing Costs: It means the expenses incurred by the farmer for marketing his products in the first point of sale (whether the central or the wholesale markets, or in the farm land or near the farm) and includes (packaging, transport, loading and marketing).
Selection of the Survey Staff:
The survey staff is usually highly qualified and experienced noting that most of them have participated in the implementation of the same survey in previous years.
Training:
Members of the survey staff (who have participated or did not participate in previous surveys) are trained accurately by the technical supervisors in a training course held in the Department of Statistics (DoS) which covers the survey objectives, data collection method, confidentiality and dealing with the holders. The course also includes a detailed explanation of the questionnaire components, its concepts and instructions on data collection and checking in the field. At the end of training, errors that have been made in previous years are brought to the attention of the enumerators to avoid them and to refer to the field supervisor in case of any problems in the field.
Data Collection Stage:
Organizing the Field Work:
The fieldwork is carried out by experienced and trained enumerators noting that Head of the Fieldwork Division supervises the work progress.
Data Collection:
Agricultural Crops:
The prices of agricultural products are obtained from the agricultural records of the central markets by production areas from the Ministry of Agriculture / Agricultural Marketing Department. These records cover the quantities sold in the three main markets (Amman, Irbid and Zarqa) and the price (highest, lowest and most prevailing) for these crops by production areas too. The technical staff carries out processing of these data through special programs that serve the objectives of the survey.
Marketing Costs:
The data are collected from the field through a representative sample of the agricultural holders by production areas bi-annually through a questionnaire prepared for this purpose. The data of this study are collected through bi- annual personal interviews (the direct method) of agricultural holders. During each visit, data of the latest survey conducted during the specified period is collected.
Production requirements:
The data are collected from the field through a representative sample of the agricultural production requirements by the production areas annually through a questionnaire prepared for this purpose. The data of this study are collected through personal interviews (the direct method) of retailers annually covering the study conducted during the specified period.
Data Processing Phase:
– Agricultural Crops:
Preparing the data tables according to data output received from the central markets (Amman, Irbid, Zarqa) by our technical staff (in the Agricultural Economy Division), then carrying out data entry process using a special computer program.
– Marketing Costs:
The data processing work of the survey questionnaire is carried out using special data entry software).
– Crops Production Requirements:
The data processing work of the survey questionnaire is carried out using special data entry software).
– The Data Processing Work passes through the Following Stages:
 Checking and Coding:
– Agricultural Crops:
Our technical staff in the Agricultural Economy Division performs data entry, checking, coding and preparation of the central market data tables on Excel sheets.
– Marketing Costs:
After completion of data collection from the field, our technical staff in the Agricultural Economy Division carries out the checking and coding process of the questionnaires in accordance with the edit rules and coding instructions as shown in the Agricultural Price Survey Guide.
– Crops Production Requirements:
After completing the field data collection process, the technical staff of the Agricultural Economy Division checks and codes the questionnaires in accordance with the instructions of the edit rules and the Coding Manual in the Agricultural Prices Survey Guide.
 Storage of Questionnaires:
One of our employees in the Division receives the questionnaires of the Marketing Costs Survey and the Agricultural Production Requirements Survey prepared in the field by the Field Supervisor, then the questionnaires are matched with the sample list to determine the number of remaining questionnaires, if any.
 Final Review:
The staff of the Agricultural Economy Division re-checks the data received from the markets and also the questionnaires. In case of field errors in the questionnaire during the edit phase, the erroneous ones are returned to the field for correction by the field supervisor.
 Tabulation and Dissemination of the Results:
Data of the completed questionnaires are entered into the computer using the data entry programs prepared in advance. This process is carried out using automated edit rules that have been prepared in advance so that data of any erroneous questionnaire cannot be entered before being corrected.
After completion of the data entry process, the IT specialist produces a list of errors for being corrected.
 Data Extraction Stage:
After revising the errors’ list, the IT specialist produces a table of the results at the level of each month for the Kingdom, Jordan valley (Aghwar) and the highlands. Then, the annual results of the prices are extracted by calculating the weighted average for the year. These tables are checked to ensure being correct and errors-free in terms of form and content in order to prepare the Prices Bulletin.
 Classifying the Output Tables in the Bulletin by the Following Groups:
1 – Prices and marketing costs of agricultural products sold in the central markets, farm gate or near the farm.
2- Percentage of quantities sold per month by production areas and marketing places.
3 – Prices of Crops Production Requirements.
Tables Published in the Agricultural Statistics Bulletin:
– Marketing costs, sales prices in the central markets and farm gate prices of tomatoes sold by region and months.
– Marketing costs, sales prices in the central markets and farm gate prices of squash sold by region and months.
– Marketing costs, sales prices in the central markets and farm gate prices of eggplants sold by region and months.
– Marketing costs, sales prices in the central markets and farm gate prices of cucumber sold by region and months.
– Marketing costs, sales prices and farm gate prices for quantities sold in the farm or nearby by crop and months.
– Proportional distribution of monthly sales of the crop to total quantity sold by production area.
– Proportional distribution of the share of different marketing places from total sold quantities of the crop by months.
– Marketing costs, sales prices in the central markets and farm gate prices of sold vegetable quantities by crop and months.
– Marketing costs, sales prices in the central markets and farm gate prices of sold fruits quantities by crop and months.
– Marketing costs, sales prices and farm gate prices of sold banana quantities in the farm or nearby by months.
– Marketing costs, sales prices in the central markets and farm gate prices for quantities sold by crop and months.
– Average price of seeds, seedlings and spawns in the Kingdom by crop and kind.
– Average price of chemical and organic fertilizers in the Kingdom by type and brand.
– Average price of pesticides and agricultural treatments in the Kingdom by type and brand.

The published tables are based on data disseminated by:

  1. Marketing costs, sales prices in the central markets and farm gate prices of sold quantities by months.
  2. Marketing costs, sales prices and farm gate prices for quantities sold in the farm by months.
  3. Percentage of monthly sold quantities to total quantity sold by production area.
  4. Percentage of the share of different marketing places to total sold quantities by months.
  5. Farm gate price indices by months.

The Agricultural Crops Prices Survey data are published in the Annual Agricultural Statistics Bulletin published each June.

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