Wheat yield dynamics in Saudi Arabia: evidence on short- and long-run determinants

Abstract The Saudi government considers wheat its main food security crop, although the country faces three major barriers to wheat production, which include its dry climate, insufficient water resources, and its current agricultural structure. The research analyzes wheat production elements in Saudi Arabia by analyzing agricultural statistics from 1990 to 2023 on a yearly basis. The research employs two econometric approaches, which operate together to process data through the Partial Adjustment Model (PAM) for studying system slow adjustments and their persistent effects, and the Autoregressive Distributed Lag (ARDL) model for studying both short-term and long-term relationships between variables. The results show that yield from previous periods stands as the only factor that produces statistically significant results, which demonstrates that yield values tend to maintain their previous levels. The study found that relative input/output prices together with rainfall and temperature conditions, a technology proxy, and policy-support dummy did not produce significant results, which researchers attribute to irrigation protection mechanisms, imperfect proxy measurements, and producers' historical resistance to market price changes. The ARDL bounds test does not support cointegration, suggesting no stable long-run equilibrium relation among the included variables in this sample. The research indicates that policy discussions should focus on developing sustainable productivity methods and better tracking of technology and policy strength, and establishing better farm data collection systems to achieve sustainable yield expansion under limited resources.