Bridging the gap between demand and supply of food

Sep 02

The agricultural plans of any country are to raise the standard of living of its population. One of the ways to measure this is to ensure nutritional food availability for the people. How this balance of demand for food is met by supply depends on the social and economical activity of the country.

Food security is one of the important concerns of any country. The prime aim is to see that people are healthy by eating good nutritious food. A healthy human being is then capable of working to the best of his/her potential which affects the GDP at the gross level.

How does one work out the demand and supply of food projections? In countries where the population is increasing, the increasing demand for food is a major concern. The agricultural activity of each country depends on the climate and soil. The crops that are grown are native to that country. If most of the commodities, which people need, are produced within the country it is much easier to manage things since the country is self sufficient.  This will ensure that imports are low and there is not dependence on external nations. If the agricultural growth is linear to the population it ensures that there is a balance.

At the same time higher incomes and urbanization increases the demand for commodities for dairy products and livestock. Thus maintaining a proper balance between supply and demand becomes important in the future. If there is an imbalance prices and profit margins could get affected. This in turn would affect the poor of the country and the farmers. Then the Government might have to bring in new policies to safeguard them.

To estimate the demand some kind of methodology which gives data is used. The monthly expenditure and incomes of various households are got. The expenses on various types of food commodities are studied. The average expense on various food items is then calculated. Then the demand projection for the food commodities is drawn up for the various localities giving a fair idea of consumption.

This is then compared against the supply to see the commodities which are deficient. These deficient commodities have to be imported to fill in the gap.  The prices of the imported items are likely to be high.

Thus a nation which is self sufficient has a good chance of having a small imbalance between supply and demand of food commodities. Good governance sees to that this imbalance is minimized to a large extent.

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