SumnerAREUpdatespring99

SumnerAREUpdatespring99 - Vol.2 No. 3 Vol. 2, No. 3 Spring,...

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In this issue. .. International and Regional Issues in African Elephant Management Lovell Jarvis and Douglas Larson. ............ 3 Agricultural Reform in an Historical Context Daniel A. Sumner. ......... 5 ARE Faculty Profile Philip L. Martin. ........ 11 In the next issue. .... The California Winegrape Industry Dale M. Heien T he strawberry market, like other markets for perishable agricultural commodities, is characterized by boom-bust price cycles resulting from seasonal variability in production and uncertain weather conditions. For individual producers, there are large payoffs to participating in the peak points of the annual cycle, which typically occur during the months of December, January, and February. However, agronomic constraints on the timing of production, and technical constraints on transportation and storage, limit producers’ ability to market during high price periods. For the industry as a whole, the aggregate results of individuals’ efforts to respond to seasonally-based price fluctuations can be self-defeating. For example, with innovations such as the breeding of heartier varieties, or improving storage and transport, changes in industry price patterns often follow. Producers’ attempts to benefit from predictable components of price seasonality may dampen such cycles. This article examines some current production trends in the national strawberry industry and identifies some important economic issues associated with seasonal price patterns. California has dominated strawberry production in the United States over the last three decades. Concurrently, Califor- nia’s major competitors, such as Florida, Oregon and Mexico, have scaled back their production and/ or targeted their production to supply niche markets. Over this time period, national sales to the processed strawberry market have also steadily given way to sales on the higher valued fresh strawberry market. Currently, California sales into both the fresh and processed markets total be- tween $500-600 million annually, making strawberries the 11 th most valuable crop in the state (CA Dept. of Food and Agriculture). Seasonal Prices and Supply-Side Adjustments in the California Strawberry Industry by Frank M. Han, Colin A. Carter and Rachael E. Goodhue STRAWBERRIES—continued on page 2 Vol. 2, No. 3 Spring, 1999 Vol.2 No. 3 Spring, 1999
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2 Agricultural and Resource Economics Update STRAWBERRIES—continued on page 8 California dominates its nearest competitors in the na- tional strawberry market, accounting for over 80% of na- tional production (Figure 1). This is due to the combination of three factors: (1) a greater number of planted acres; (2) substantially higher yields, and (3) a significantly longer harvest season. Historically, while yields have fluctuated between 25 and 28 tons per acre over the last 15 years, California’s share of national acreage has risen steadily from 28% in 1982 to 50% in 1997.
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This note was uploaded on 05/03/2008 for the course ARE 120 taught by Professor Alston during the Spring '08 term at UC Davis.

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SumnerAREUpdatespring99 - Vol.2 No. 3 Vol. 2, No. 3 Spring,...

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