Once the backbone of society, many are saying that agriculture is no longer central to the country’s economy. On the eve of the harvest festival of Shavuot, TheMarker asked economists and farmers: Does Israel really need agriculture?
... But Yaron Zelekha, a former accountant general of the Finance Ministry, says the claim that Israel needs to maintain self-sufficiency in food is nonsense. And Iddo Kan, who heads the department of agricultural economics and management at Hebrew University’s Rehovot campus, says the real question is where Israel has a comparative advantage and where it doesn’t.
“Currently we don’t have food security because we import a significant portion of our food. In fresh food, we have a comparative advantage because shipping costs are high,” Kan says. “Israeli zucchini, for example, costs 3,000 shekels ($860) per ton, compared with 5,400 shekels for imported.” On the other hand, he says, imported onions cost 1,500 shekels a ton, compared with 2,200 shekels for domestically grown ones. “The country must ask itself if a sector is profitable and supports itself, if we have a comparative advantage over the alternative. If so, then it should be preserved. If not — then not.”