Investigating Producer Support Estimate Index and Sensitivity Analysis of this ratio Exchange Rates (Case Study: Beef Meat)

Main objective of this paper is to evaluate supportive policies of beef producers during the first, second, third and fourth terms of Economic, Social, and Cultural Development Plans (1989 - 2008).To evaluate the policies, the Producers Support Estimate(PSE) index and other indicators (PSE %, NPC & NAC) were used. Furthermore, percentages of PSE were calculated in different scenarios of exchange rate (such as black market exchange rate, purchase power parity (PPP) exchange rate, 5 percent increase in purchase power parity (PPP) exchange rate and 5 percent decrease in purchase power parity (PPP) exchange rate). The results presented that market price support (MPS) of beef producers had increasing trend during development plans, especially in the first and the second plans. The government’s budgetary payments (BP), on the other hand, presented decreasing trend from 4 billion Rls (local current) in the first development plan to 2 billion Rls in the forth development plan. Furthermore, total support estimate (PSE) of beef producers increased during the fourth terms of development plans. It is concluded that share of MPS in total producers support estimate (PSE) is more than BP. The study results presented that, in all terms of the development plan (except for the first plan), percentages of PSE calculated by purchase power parity (PPP) exchange rate were higher than amounts calculated by black market exchange rate. PSE% was found sensitive to changes in the exchange rate.