orange case notes

orange case notes - o Brazil exports 99% of its production...

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Brazil has becoming a big threat to the US orange industry Brazil has lower labor costs Florida industry has been protected by a tarrif Florida and brazil processed over 90% of the worlds orange juice Citrus contributed to more than $9 billion in economic activity and support over 90,000 jobs in Florida. o States 2 nd largest industry after tourism FDOC was created to “protect and enhance the quality and reputation of Florida citrus in both domestic and foreign markets” Not from concentrate and concentrated orange juice were two different types o Different companies competing In the past a price change at the grower level was reflected in consumer prices very quickly o New environment, lower prices for growers do not necessarily mean lower prices for consumers The freezes of the 1980s were the main crontributing factor to brazils orange growth The US consumes much of Florida’s orange juice production
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Unformatted text preview: o Brazil exports 99% of its production Florida citrus had been under tarrif protection since the 30s o Tarrif has been lowered over time but if it is eliminated it would be devastating to to o Griffiths argues that it will be hard to preserve the tarrif in the long run A tax paid to the FDOC by growers on every box of citrus was eliminated in 2003 and ruled unconstituinal o This tax had been used by the FDOC to fund their generic advertising campaigns o The box tax accounted for 40% of their profits With the new Brazilian ships the cost advantage of Florida NFC producers had over NFC shipped from brazil had shrunk from $.55 to $.29 per gallon. Also NFC shipped from brazil to the northeast of the US was cheaper than NFC shipped from Florida to the northeast o Florida has lost its competitive advantage and will continue to do so at this rate...
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