AN INTERREGIONAL COMPETITION ANALYSIS OF THE UNITED STATES APPLE INDUSTRY
Abstract
Quantification of interregional competition among fresh apple, applesauce, and apple juice supply regions in U.S. markets was completed using a revised linear transportation model. Parameters included current variable production costs, current processing costs, transportation rates, domestic supply, and domestic consumption. The sensitivity to changes in parameters was examined through the application of alternative supplies, production-processing costs, projected consumption and transportation rates. Results indicated Washington has short-run supply and cost advantage in most U.S. fresh apple markets. The Midwest has shipping capability with increased quantities. Aggregate industry cost was reduced under long-run optimal production locations and distribution in the least cost pattern and volumes. Washington's role was drastically reduced in the long-run and the Midwest dominated U.S. shipments. Applesauce results indicated less concentrated economic advantage in production regions under given supplies. Virginia dominated short-run interregional shipments in the East and Midwest. Indiana has the capacity to increase market position due to production-transportation cost advantages. The long-run pattern of supply and shipments would reduce costs but increase concentration with West Virginia, North Carolina, Michigan/Indiana, and Washington the major supply regions. Short-run supply and production-processing cost advantage of Washington, Michigan, and New York gained these states dominant regional positions in apple juice. Indiana, with added short-run supplies, gained advantage; and has long-run market potential with slight cost reductions. Long-run juice competition reduced supply regions, lowered total costs of production-processing, and clearly defined markets. Dominant in the long-run were Washington, West Virginia, Michigan, North Carolina, and New York.
Degree
Ph.D.
Subject Area
Agricultural economics
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