Published by City Farmer, Canada's Office of Urban Agriculture


Agricultural Development in Israel

From the experience of a country situated in a less favorable natural environmemt, where farming is applied within the framework of the desert and in areas surrounded by highly populated urban zones.

Raanan Katzir, Director, Project & Technology, Latin American Affairs.
Ministry of Agriculture and Rural Development.
Centre for International Agricultural Development Cooperation.(CINADCO).
Office: 12 Aranha St., POB 7011, Tel Aviv, 61070.
Tel:(-972-3-)6971709/540. Fax:(-972-3-)6971677.
Home: 4 Efter St., Tel Aviv 69362. Tel: (-972-3-)6991381. Fax: (-972-3-)6990152,
e mail:


The State of Israel covers an area of approximately 20,000 Km2 but only 20% of it is arable land. 60% of Israel is desert and just 10% of the population lives there. The remaining 40% of the country is semi-arid land. It is densely populated, and holds 90% of the population.

Israel's population has a relatively high standard of living with an annual GNP of nearly US$ 18,000 per capita. The society is mostly urban, with some 92% of the population living in cities. Although 8% of the population live in rural areas, only 2.7% of the total national work force is engaged in agricultural production.

Most of Israel's agriculture is irrigated, although water is the most limiting factor. Agricultural production in the desert takes advantage of some unique conditions: abundance of land, high temperatures and intensive radiation. The main water source is either saline water or recycled sewage water. The crops are winter vegetables and flowers in greenhouses, dates, grapes and olives irrigated with saline water. Also dairy cattle are raised under reduced heat stress.

The climate in the north of Israel is different which enables a great variety of crops to be grown: citrus, avocado, mango, grapes, apples, peaches, banana, dates, wheat, corn, cotton, peanuts, potato, vegetables, flowers, flower bulbs, etc. Animal husbandry consists mostly of dairy cattle, poultry and fish culture.

Farming in Israel is highly sophisticated, capital intensive, and based on a high level of technology. One third of the agricultural production is for export, while two third of the production is for the local market.

Agricultural production in Israel is market oriented and geared mostly to supply the demand of the urban population. It can in effect be considered as peri-urban agriculture.

Agriculture In Israel: Challenges And Responses

During its short history, agriculture in Israel has gone through different stages: from improved productivity in traditional agriculture, to diversified agriculture, to (at present) specialized agriculture geared towards a market for local consumption and export. Throughout this period, Israel's agriculture has been characterized most by rapid socioeconomic and technological adaptation. This adaptation can be attributed to the introduction and integration of knowledge, modern technology, government support, credit and extension services, a highly skilled workforce, the use of farmers' experience, and most important, the sustainable management of natural resources. Agricultural production in Israel - an industrial country - accounts for only about 3 per cent of GNP. The agricultural workforce in Israel is small: only 2.5 per cent of the population is engaged in agriculture, compared with 20 per cent some 25 years ago. The professional level of farmers is high, and they invest in high-level agricultural inputs and the use of advanced technologies. A third of the fresh and processed agricultural production and a large amount of Israeli-produced inputs are exported. This relatively high share of exports in total agricultural production testifies to the importance of agriculture for the Israeli economy as a whole.

With a total surface area of about 20 000 square kilometers, half of which is desert, the State of Israel is small. Only 20 per cent of its land can be cultivated. Precipitation varies from 50 millimeters a year in the south to 1000 millimeters a year in the north. The geography of the country is such that the north has an abundant water supply, while the central part receives less rain, and the south is a desert-like, very dry area. Similarly, the climate in Israel varies from Mediterranean and tropical to mild European. This gives rise to an enormous variability in water supply within the country and poses a great problem for agriculture. There is a long-standing principle in Israel, based on a national, political consensus, that agricultural settlement should take place in all regions without any exception, even in the marginal ones. This means that in order to facilitate agricultural activities throughout the country, water has to be channeled from the north to the south. Thus, the fact that a large part of the Israeli land area is a desert, the uneven distribution of natural water supplies between regions and the relatively unfavorable climatic conditions constitute the three main limiting factors with regard to agricultural production in Israel.

The challenge of finding ways and means to optimize the use of scarce natural resources has been met in two main ways. The first involves extensive research, which has led to the introduction of new plants and seed varieties along with more productive agricultural techniques which are adapted to Israel's specific climatic, soil and water conditions. The second is the setting up of an institutional framework which involves the government, the private sector and the individual farmers, and consists of national extension services and credit, and export and farmers' organizations. The aim of this framework has been to guide and direct agricultural development with a view to finding region-specific solutions to the above-mentioned problems. This chapter discusses how research and the specific institutional set-up have been used to maximize the contribution of agriculture to the economic development of Israel.

The Development Of Region-Specific Agricultural Technology


Agricultural research has been based on long- and short-term requirements. From the long-term perspective, it has been guided by the need to develop crops which are competitive on the potential market, and to solve basic problems in production for export. The short-term aim has been to find solutions for more immediate needs, such as irrigation, plant protection and cultivation machinery. A guiding principle has been to conduct applied research which is integrated into the framework of regional research and development (R&D) schemes. Israel has gained a reputation for its regional R&D system, which has aimed to produce regularly updated knowledge and technology. R&D schemes are dictated by market opportunities. Produce which has a potential for local or export markets and can be produced profitably will enjoy a wide range of research and extension services. Multidisciplinary teams of researchers, economists and planners tackle the problems in accordance with budgetary constraints and economic priorities. Such a concept leads to the development of existing agricultural branches, the creation of new branches and the advancement of technologies and know-how with a view to improving and promoting the final produce. This comprehensive approach ensures rapid adaptation to current circumstances while at the same time being forward-looking.


The drip irrigation system has been widely used as a low-consuming water system for irrigation purposes. It enables precise water application integrated with the application of fertilizers, and has thus become known as 'fertigation'. This system saves on the cost of water to the farmer and allows the efficient use of saline water for irrigation purposes. Saline water, which is found throughout the arid lands, can be used to irrigate tolerant crops such as tomatoes, melons, wheat, cotton, beets, asparagus, Bermuda grass, dates, grapes and olives. Even in arid zones, when it rains, water which is not absorbed by the soil flows in dry river beds towards the sea. Water reservoirs with various capacities have been built along the dry river bed. During the rain the water is pumped from the stream into the reservoirs. The conserved water is used for irrigation purposes for cotton, maize, sorghum and legumes. In arid zones, water from these reservoirs serves as an economic resource, depending on the alternative price of water.

In the southern regions, thermal water has been derived from very deep wells and is used to heat greenhouses. Hot water is pumped into a sealed network of plastic pipelines which are placed close to the plants on the plant bed in order to heat the air surrounding the plants. The water is then channeled to storage tanks, where it is allowed to cool before being used again for irrigation in a separate drip irrigation system. In the north, an old water stream is used for the production of trout, which are considered a delicacy and fetch high prices in the market. The only freshwater lake is used as an economic resource for tourism, recreation, fishing, and water supply for drinking, industry and agriculture. In regions where the use of land and water for agricultural purposes is limited, a special hydroponics system, constructed in greenhouses and based on water and fertilizer supply, is operated in a closed system. The water used is treated by filtration and ultraviolet radiation to prevent contamination of the micro-organisms. Such a system, in which water is circulated permanently through concrete and plastic beds, makes possible the growing of ornamental pot plants.

The intensive use of water has contributed to water shortages in many areas. As a result, large water-supply projects needed to be constructed; they have allowed water to be carried over great distances, sometimes hundreds of kilometers, but they have also made water more expensive. Taking into account the fact that water has an economic value, there is a need to set the price of water and simultaneously to create a mechanism for controlling and limiting its use through the establishment of consumption quotas.

Israel follows a specific policy for water, which is determined by the Ministry of National Infra Structures The regulations are controlled by the 'Water Commissioner'. All producers have a quota for irrigation water which can be reduced during periods of water shortage. The price of water ranges between US$ 0.2 and US$ 0.4 per cubic meter, that is, within the margin of economically profitable agricultural production; the price is lowest for the first third of the quota and highest for the last third. Those exceeding their quota have to pay substantial fines.

Sewage water which finds its way into natural waterways is considered a serious ecological threat. Hence, wherever possible, the use of high-value potable water has been replaced by the use of recycled sewage water, to the benefit of both urban and rural communities. This water can also be used for the cultivation of algae, which are then used as raw material for industrial products. Another solution for saving water is to ensure more efficient management of water-conveying installations in order to avoid losses due to deteriorating water-supply systems. Lastly, the process of desalination of sea water for drinking purposes is an expensive option which can be exercised when no other alternative exists. However technological advances as Reverse Osmosis indicate that the price of Salinization is declining.

Soil and Plants

Because of the use of fertigation, sand dunes are being used to produce crops such as citrus, avocado, mango, vegetables and flowers. Under desert conditions, in which marginal land and lack of water are dominant, specially adapted crops can be grown successfully. The desert is characterized by high heat radiation and adequate temperatures during the winter for intensive greenhouse production of off-season crops, mainly vegetables, fruit and flowers for export to the European market. Water supply, radiation, temperature, air humidity, nutrition and carbon dioxide levels are fully controlled. Two commercial crops were introduced into the desert area of Israel almost two decades ago: the Jojoba, which produces oil seeds used in cosmetic production; and a thornless cactus called Tuna (Opuntia), whose leaves serve as animal feed and whose fruit has a valuable market.

Israel's agriculture is well known for the intensive introduction of botanical species from various parts of the world. Plant geneticists in Israel produce varieties of wheat adapted to drought conditions, which is a practical solution to growing wheat in arid regions. Furthermore, they have discovered a long list of species which are tolerant of saline water irrigation, and have produced varieties of melon and tomato resistant to soil pathogens and virus diseases. The long shelf-life of the Israeli tomato is well known in most European countries. To deal with pest and disease problems, which are recognized as the main limiting factor affecting irrigated agriculture, the Integrated Pest Management (IPM) system was introduced and has been commonly applied. Regional IPM services are based on the monitoring of pests, threshold levels and selective pesticides. Biological control methods are applied to reduce as much as possible the use of chemical pesticides with a view to reducing threats to human health.

Animal Husbandry

The heat stress caused by raising dairy cattle under the extreme temperatures of the desert negatively affects milk production. Various measures such as ventilation and humidifiers were developed and successfully introduced into the milk production industry to alleviate heat stress and increase milk production. The technology of using chicken manure for cattle nutrition is also widely utilized. Artificial insemination is common in dairy herd management, and the use of genetic technology can be considered a primary reason for the high level of milk production in Israel.

The Institutional Framework

Farmers and policy makers, in particular those of the Ministry of Agriculture, have established an institutional mechanism with a view to guiding and directing agricultural development under changing circumstances, continually taking into consideration the local socioeconomic and foreign market situations. It is important to understand the socioeconomic, professional and organizational criteria that have made this adaptation possible.

The National Extension Service

The most important requirement for export crops is quality, which in turn requires a high production standard. Farmers cultivating such crops must have the capacity and ability to use advanced agro-technology in the production process. Traditional farmers therefore have to adapt, which means that they must learn how to use advanced agro-technologies. The duty of the extension service is to help farmers advance through the introduction of more knowledge and better agro-technologies. Extension support is provided by the government via the Ministry of Agriculture and by the private sector through companies selling pesticides, fertilizers, machinery and auxiliary tools. Farming Branch Technical Committees (FBTCs) are headed by an Extension Officer, within the framework of the Ministry, and integrate all aspects of research, extension and other technical activities.

Sustainable agriculture geared towards market-oriented agriculture and exports can take place if parallel efforts are devoted to promoting economic development, culture and health. The tasks involved include improving community functions, supporting the role of women, improving education, generating knowledge by (mainly applied) research, solving local problems and overcoming barriers to agricultural production.

Israel's farmers are highly skilled (a large number of them even have an academic background), make extensive use of capital and orient their largely mechanized production towards both the domestic and export markets. Research findings and innovations are readily implemented.

Government and Private Organizations

Agricultural and commercial banks transfer money to farmers in the form of credits, loans or grants for development or working capital in the form of advance payments and so on. In addition, production and marketing boards provide farmers with advance credits for cultivating export crops on the basis of binding contracts. A government company covers export risks such as a price collapse on foreign markets.

The main organization in charge of all export activities in Israel is AGREXO. It was set up jointly by the government and the production and marketing boards, and operates on a fully commercial basis for both producers and potential buyers. It takes care of all the logistical requirements of its export activities: planning, providing guidelines for quality, credit allocations, sales, marketing, and organizational and financial management.

The Insurance Fund for Natural Damages belongs jointly to the government and the farmers, and guarantees the reimbursement of lost inputs in the case of damage caused by natural disasters. Only the actual costs of production are covered in order to avoid discontinuation of the production process. The production and marketing boards are joint boards of the government and the producers; they aim to organize the commercialization of production, to oversee the price system in order to ensure stable incomes for farmers, to assist the producer in purchasing inputs at reduced cost, and to encourage the establishment of transportation systems. Another important function of these boards is to plan agricultural output in the form of quotas in accordance with the needs of local and export markets in order to avoid supply surpluses and losses for farmers. The boards also give financial support to research whose outcome can be exploited as a decision-making tool in planning and export policies.

The national and regional farmers' organization represents farmers in the Agricultural Branch Committee, the production and marketing boards, AGREXO, and so on. Its task is to encourage the publication of professional material, to maintain contacts with similar foreign organizations, and to promote direct research and extension in accordance with farmers' needs.

The Agricultural Branch Committee, a directing committee, forms a national infrastructure for directing and coordinating the above-mentioned activities. All elements relating to the agricultural production process are represented in it, including government offices, negotiating export targets, and distribution of resources for research, extension and planning.

The Example Of Cotton In Israel

Cotton is a relatively new crop in Israel, introduced in the early 1950s. Continuous research and development was essential for reducing production costs and increasing yield and quality. Cotton is grown in Israel in the dry season (April to October) and has therefore to be cultivated as an irrigated crop. Growing is fully mechanized. It is an intensive crop with high input costs: water, fertilizers, pesticides and cultivation machinery. The input costs in Israel are about US$ 0.70 for one pound of fiber. The profits are marginal, and there is a high financial risk factor. The government recently guaranteed a minimum price for local cotton of US$ 0.75 per pound in order to tackle the problem of the decreasing area under cotton cultivation. Yield is high and can reach up to 6200 Kg per Hectare.

Israel has a highly developed research and extension system for cotton growing which is well coordinated at both national and regional levels. A National Cotton Committee, composed of researchers, extension specialists and cotton growers, is in charge of distributing the available financial resources among research, development and extension. Intensive research led to the development of local varieties which respond well to irrigation, are disease-resistant and have a high yield of good quality. Cotton farmers are assisted by a well-developed extension service, laboratory facilities for defining soil, water and fertilizer relationships, national and regional services for pest control, a reliable air spraying service, and a dependable supply of fertilizers and pesticides. Other important technological innovations originating in Israel for the development of cotton growing include computer programs for the control of cotton cultivation, regional gin and grading systems and quality control of the produce, together with the introduction of drip irrigation. Through regional service centers, farmers are the owners of gins for the separation of cotton fiber. The Cotton Production and Marketing Board, run by cotton growers, is responsible for growing and marketing cotton, negotiating minimum prices, defining quality (grading) and providing storage facilities for cotton stocks. It also provides collective insurance to all cotton growers against damage resulting from natural disasters. A special insurance fund exists in Israel which provides insurance against damage by rain, extreme temperatures, storms and flooding, in which the Ministry of Agriculture, the Ministry of Finance and the farmers participate.

Cotton picked selectively by hand is of higher quality than that harvested mechanically. Despite this fact, cotton in Israel is harvested exclusively by mechanical equipment, given that the supply of manual workers in agriculture is very small. Harvesting machines are used for cotton picking. Raw cotton is compacted into modules of 89 tons each. Special attention is paid to post-harvest handling. Modules are left in the field, wrapped in plastic sheets to avoid damp from dew or rain and from the soil below. They are placed a few meters apart from each other in order to minimize damage in case of fire.

The quality level of raw cotton is assessed by a regional control system. The raw material is supplied to the gin at a uniform quality level. This enables the gin to work uninterrupted, increasing efficiency and reducing costs. Development of cotton varieties is guided by the following quality requirements: yield, length of fiber, color, resistance to diseases and pests, amount of impurities and flexibility. The criteria for the quality of the fibre are determined by the needs of the textile industries.

New Challenges And Developments

In recent years, new aspects of agricultural development procedures have been focused on agro-industry, agro-tourism, peri-urban agriculture and small-farmer entrepreneurship. All of these are based on the principle of making sustainable use of natural resources.

Most of the immigrants in developing countries settle in neighborhoods of large capital cities. These neighborhoods are usually poor and have a low level of economic activity. Consequently, living conditions are hard and sanitary facilities are inadequate for the number of people. The continuing urbanization process and its confrontation with the peri-urban area cause many social, economic and environmental problems. Intensive urbanization also creates extreme ecological disturbances. Proper agro-ecological solutions as well as some changes in the peri-urban rural sector can offer mutual benefit to both farmers and the city population. The 'family farm', for example, producing in the neighborhood of a big city, allows young farmers to provide food for the city and improve their income. Small farms tend to produce specialized crops for the city. These usually command high prices, and on those farms the production process becomes capital-intensive, based on advanced technologies. A further step in the development process and one step ahead of specialized farming is agro-industrialization. In this case, the farmer becomes an entrepreneur and establishes an industrialized business based on high-value agricultural farm products. The advantages of an agricultural farm being near the city, such as cheap labor and proximity to an international airport, can be exploited for improving export performance.

The transition from family farming to agro-business began many years ago. The United States was one of the first countries in which family farms were converted into large commercial farms, managed like any industry in the agricultural sector. These commercial and business-like farms are characterized by their entrepreneurial approach, the intensive and high production level for both the local and export markets, advanced technologies, their operating independently of central authority, their high level of management capacity and their flexibility for rapid adjustment to changing conditions.


The Israeli model of agricultural development can be characterized as one which did not stem purely from privatized agriculture but was strongly influenced by the state. Israel may have enjoyed some advantages over other developing countries in the form of high levels of external financial support and skilled labor facilitating the transition to a specialized agricultural economy. None the less, the mechanisms of market systems coordinated jointly by government, private entities and producer organizations, the provision of an effective organizational structure, export promotion, the integrated approach of research and extension services, and the sustainable use of natural resources may serve as a model of agricultural development for other developing countries.

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Revised Saturday, December 6, 1998

Published by City Farmer
Canada's Office of Urban Agriculture