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<br />The NIRAP model projects commodity prices based upon observed historical <br />relationships between supply and demand for various crops, including substi- <br />tution between crops. The demand curve in a future year is projected based <br />upon growth in U.S. population and per capita income and the demand for <br />exports of farm commodities caused by economic growth and agricultural short- <br />falls in the rest of the world. Production is estimated based upon past <br />trends in land use (with appropriate constraints) and projected increases in <br />the productivity (i.e. crop yields) of farm land. The specific assumption <br />used in projecting these supply and demand curves are discussed below. The <br />crop pri ces projected over the forty-year study peri od generally show a slow <br />rise in real terms. <br /> <br />The effect of changes in High Plains production on national crop prices <br />and production was estimated using an iterative process between NIRAP and <br />the state LP farm enterprise models. An initial estimate of national prices <br />was made using the NIRAP model with estimates of total national production <br />including production losses resulting from a decline in irrigated acreage <br />in the High Plains. These prices were then provided to the state LP <br />researchers, who refined estimates of production in the Baseline using <br />these prices. Regional production totals for each crop derived from the <br />state LP models were then substituted for the initial estimates for the High <br />Plains Region which were included in national production in the original <br />NIRAP estimates. <br /> <br />As the analysis moved sequentially through the alternative management <br />strategies, the crop prices for each strategy (beginning with the Baseline) <br />became the initial prices for analysis of the next succeeding strategy. The <br />LP models were run to reflect the changes in water use and availability <br />resulting from the policies included in the management strategy. Resulting <br />changes in High Plains crop production were then entered into the NIRAP <br />model, and revised prices and national production totals were calculated for <br />each crop in each study year. The NIRAP model thus allowed for other regions <br />to change production, if indicated, when High Plains production changes pro- <br />duced a change in national price. This new price became the final price for <br />the management strategy, and the results of the LP models were recalculated <br />using the final price. Where changes from the preceding strategy of less <br /> <br />A-1Z <br />