Dynamic Analysis of Date Palm Producers’ Price and Climate Variability: Shocks and Responses in Saudi Arabia
Year: 2026
Type: article
Abstract: Climate change influences crop prices through its impacts on agricultural production, costs, consumer and producer behavior, and the market equilibrium. Therefore, this study aims to examine the dynamic relationship between climate change and date palm producer prices in Saudi Arabia utilizing a Vector Autoregression (VAR) method to investigate short-run and long-run dynamics. The analysis incorporates impulse response functions (IRFs), forecast error variance decomposition (FEVD), and historical decomposition (HD). The empirical findings indicate that date palm producer prices exhibit strong persistence and are predominantly explained by their own innovations in the short run. Although climate factors’ shocks exert measurable short-run effects on producer prices, these responses diminish over time, indicating that the market effectively absorbs climate-related changes while maintaining long-run equilibrium. However, FEVD and HD results reveal that the contribution of temperature and relative humidity to producer price fluctuations increases steadily over time, highlighting the growing importance of climate change in shaping long-term market dynamics. The findings emphasize the need for policies that boost climate-smart agriculture and drought-tolerant date palm varieties. Increasing climate adaptation and risk management strategies will improve the resilience of the date palm sector, reduce long-term price volatility, promote sustainable agricultural development, and enhance food security in Saudi Arabia.
Source: Agriculture
Authors: Raga M. Elzaki, Asmaa Alhujaili
Institution: King Faisal University
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
SDGs: Climate action, Zero hunger
Open Access status: gold
Estimated APC paid: $3,137
Funder: King Faisal University
OpenAlex ID: W7212028784