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Group Title: Working paper - International Agricultural Trade and Policy Center. University of Florida ; WPTC 04-2
Title: Economic impact of invasive species in the ornamental commodity in Puerto Rico : towards establishing a multidimensional framework for data collection and analysis
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Title: Economic impact of invasive species in the ornamental commodity in Puerto Rico : towards establishing a multidimensional framework for data collection and analysis
Series Title: Working paper - International Agricultural Trade and Policy Center. University of Florida ; WPTC 04-2
Physical Description: Book
Language: English
Creator: Alamo, C. I.
Franqui, R. A.
Evans, E.
Publisher: International Agricultural Trade and Policy Center. University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2004
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WPTC 04-2




i ional Agricultural Trade and Policy Center


WORKING PAPER SERIES


UNIVERSITY OF

SFLORIDA
Institute of Food and Agricultural Sciences


THE ECONOMIC IMPACT OF INVASIVE SPECIES IN THE
ORNAMENTAL COMMODITY IN PUERTO RICO: TOWARDS
ESTABLISHING A MULTIDIMENSIONAL FRAMEWORK FOR
DATA COLLECTION AND ANALYSIS

By
C. I. Alamo, R. A. Franqui, & E. Evans
WPTC 04-2 March 2004


"j_









INTERNATIONAL AGRICULTURAL TRADE AND POLICY CENTER


The International Agricultural Trade and Policy Center (IATPC) was established in 1990
in the Food & Resource Economics Department (FRED) of the Institute of Food and
Agricultural Sciences (IFAS) at the University of Florida. Its mission is to provide
information, education, and research directed to immediate and long-term enhancement
and sustainability of international trade and natural resource use. Its scope includes not
only trade and related policy issues, but also agricultural, rural, resource, environmental,
food, state, national and international policies, regulations, and issues that influence trade
and development.

The Center's objectives are to:

Support initiatives that enable a better understanding of U.S. and international
trade policy issues impacting the competitiveness of Florida agriculture and all
specialty crops and livestock nationwide;
Serve as a nationwide resource base for research on international agricultural
trade policy issues on all specialty crops and livestock;
Disseminate agricultural trade related research results and publications;
Interact with researchers, business and industry groups, state and federal agencies,
and policymakers to examine and discuss agricultural trade policy questions.

Programs in the IATPC have been organized around five key program areas.

Risk Management and Capital Markets
Agricultural Labor
Regulatory Policy and Competitiveness
Demand Systems and International Trade
State and Local Government Policy and Agricultural Competitiveness.

There are 10 faculty from the Food & Resource Economics Department who conduct
research in these program areas for the IATPC. Each of these program areas has a set of
projects that have been undertaken to address these critical areas of need. Faculty have
acquired additional grant funds of more than one million dollars over the last three years
to augment these programs.









Abstract


The ornamental commodity in Puerto Rico is valued for its economic contribution in the
agricultural sector, its contribution to the esthetics of natural scenarios that impact the
tourism sector, and for its environmental role. In the fiscal year 2001, ornamentals
generated 4.8% of the total Agricultural Gross Product. In that year the production value
at farm level was $34.1 million, the export value $0.5 million, and the import value $11.5
millions. Of the local production value, 1.5% was exported and 34.3% of the ornamental
local market value was imported. The active trade traffic in Puerto Rico is a factor that
increases the risk of the introduction of invasive species that affect the agricultural sector.
It is necessary to estimate the economic impact of the established invasive species and
those with high potential for introduction. The economic analysis must consider the
impact on production, on market, and on the environment. The direct and indirect impact
on market and non-market areas has to be estimated. The study presented in this paper
pretends to gather economic data on the ornamental commodity and biological data on
invasive pests and diseases to initiate the development of a comprehensive species risk
management framework that incorporates the economic impact of invasive species


Key Words: invasive species, ornamental, economic impact analysis









THE ECONOMIC IMPACT OF INVASIVE SPECIES IN THE ORNAMENTAL
COMMODITY IN PUERTO RICO: TOWARDS ESTABLISHING A
MULTIDIMENSIONAL FRAMEWORK FOR DATA COLLECTION AND
ANALYSIS.

Alamo, C.I.,1 Franqui, R.A2, and Evans, E.3



Introduction:

The ornamental commodity in Puerto Rico is valued for its farm and market income,
environmental role and the esthetics added to natural scenarios. This commodity impacts
the economic development potential in the agricultural and tourism sectors. Ornamentals
generate 4.8% of the total Agricultural Gross Product (Department of Agriculture 2002).
In fiscal year 2001 ornamentals contributed $34.1 million at farm level. The tourism
activity in fiscal year 2001 attracted 4.9 million visitors, who spent $2,728.1 million on
the island. (Junta de Planificacion 2002).

The ornamental commodity exhibited an increase in the value of local consumption.
From 1987 to 2001 the value of local consumption increased 230.9%, an average of
$26.0 million per year (Deparment of Agriculture of P.R 2002). In the year 2001, 74.0%
of the consumption value was generated on the island, versus 18.4 % in 1987. From
1987 to 2001 the value of local production increased 109.9%, an average of $24.5 million
per year. In the same period, imports increased 360.2%, an average of $4.5 million per
year. From 1987 to 2001 the export value decreased 90.0%, an average of $3.0 million
per year (Fig. 1).

















1 Associated Economist, Department of Agriculture Economics and Rural Sociology, Agricultural
Experiment Station, University of Puerto Rico.
2 Associated Entomologist, Department of Crops Protection, Agricultural Experiment Station, University of
Puerto Rico.
3 Assistant Director, International Agricultural Trade and Policy Center, Food and Resource Economics
Department, University of Florida.












Figure 1. The Ornamental Commodity in Puerto Rico:
Production, Exports and Imports Value
from 1987-2001

U4 S Millions
40.0

35.0
30.0

25.0

20.0
15.0

10.0
5.0 -
0.0


--Exports --Production Imports






In fiscal year 2001, Puerto Rico imported $2,142.6 million in food. In the same year
$66.6 million in agricultural products was exported. The island's strategically geographic
position and the consumer's acquisitive value allow active trade traffic. However, this
active trade in fresh agricultural commodities increases the risk of the introduction and
spread of invasive species associated with pests and diseases.

The Economic Research Service of the United States Department of Agriculture (USDA-
ERS 2003) presents 1999 Executive Order 13112, which defines an invasive species as
one that is nonnative, alien, or exotic to the ecosystem under consideration, and one
whose introduction causes, or is likely to cause, economic or environmental harm or
harm to human health. In addition, the definition considers the costs and benefits, or net
damage, of an alien species, because the benefits exceed the costs of some nonnative
species, including some crops, livestock and ornamental plants.

The rate of introduction of invasive species in Puerto Rico is evident in the results
reported by Serrano and Franqui (Serrano et al. 2001). They reported that between 1963
and 1999 one to six exotic insects were introduced per year, an average of 1.4 major
insect pest species. Five families of major insect pests (Pseudococcidae, Diaspidae,
Coccidae, Aphididae and Aleyrodidae) of ornamentals were introduced, representing
68.7% of the introduced species (Franqui 2003). Aside from the Homoptera family the
other important interceptions are mainly associated with cut flowers. Most of these









introductions came from Caribbean Countries, Central and South America and the United
States. The majority of the interceptions made in the Luis Mufioz Marin International
Airport came from Dominican Republic, Colombia, Costa Rica, Antigua, Barbados,
Dominica and Grenada. Franqui reported that cut flowers from Colombia are the cultivars
with the most invasive species intercepted in Puerto Rico (Franqui 2003).

In fiscal year 2001, the external trade statistics reported that $0.5 million of ornamentals
was exported while $11.5 million was imported in Puerto Rico. Historically the most
important importers to Puerto Rico are Colombia, Panama, Costa Rica, United States and
Dominican Republic. Puerto Rico exports ornamentals to the United States (U.S.),
British and U.S. Virgin Islands, and others Lesser Antilles.

The introduction and spread of invasive species which have affected ornamentals have
also occurred in the time range evaluated by Serrano and Franqui. The economic impact
of those pests and diseases must be estimated, considering market, non market and
environmental damages. The Council for Agricultural Science and Technology (CAST),
in a 2002 issue paper expressed, that if non-native species become pests, the economic
risks include lost production, diminished quality, increased production costs, decreased
flexibility in production/management decisions, and increase risks for human health,
(Council for Agricultural Science and Technology 2002). Evans remarked that the
research agenda on invasive species has been developed by biological science
researchers, and much of the previous "economic" research on invasives has been
conducted by non-economists (Evans 2002). As such, the economic analysis suffers
either from various methodological problems (e.g., incorrect economic valuation,
ignoring non market environmental damages) or from being peripheral to the biological
study.

A limitation for the economic impact analysis is that there are several different
institutions collecting various information regarding pest interception, introduction,
spread and control. Although there is a collaboration accords among institutions, the
information collected by them is not compiled in a coordinated manner, hence creating
one of the difficulties in assessing what the economic impact could be on the sector if a
given pest or disease were introduced.

In April 2003 a proposal titled "Economics of Managing Invasive Species in Tropical and
Subtropical Areas in the United States of America" was approved by T-STAR initiative.
The objectives of this proposal are to develop a comprehensive species risk management
framework that incorporates the economic impact of invasive species and to develop a
collaborative interdisciplinary network of institutions and persons involved with invasive
species management.

The study presented in this paper pretends to initiate the process of identifying the data
sources and of gathering the information needed for the methodology presented in the
project "Economics of Managing Invasive Species in Tropical and Subtropical Areas in
the United States of America."









Objectives:


1. To gather economic data on the ornamental commodity and biological data on
invasive pests and diseases to initiate the development of a comprehensive species
risk management framework that incorporates the economic impact of invasive
species.
2. To identify institutions and persons involved with ornamental invasive species
management in Puerto Rico.
3. To identify the availability of the data needed for evaluation of the economic
impact.

Methodology:

The methods for the project "Economics of Managing Invasive Species in Tropical and
Subtropical Areas" involve the development of a comprehensive risk management
framework. This framework involves a biological profile of a pest or disease and the
economic effect and measurement. The biological profile includes the physical effects
that a pest has on a host, the number of potential hosts, the effects of existing control
measures, and the effects of existing management practices. This information is needed to
estimate the economic effect.

The economic impact of invasive species on the ornamental commodity is used as a case
study in order to achieve the three objectives presented. In order to achieve objective
one, economic data on production, market and ornamental trade was gathered and
analyzed. The gathered data provided information regarding the commodity outlook in
Puerto Rico, ranking the ornamental crops by economic importance. The biological data
was gathered from the institutions, scientists and persons involved with invasive species.
The identification of the most important established pests and diseases for ornamental
crops was determined by using the information provided by the biological experts. A list
was compiled of established and possible future introductions of invasive species with
potential economic impact on ornamentals.

In order to achieve objective two, interviews, both telephone and email communication,
were established with institutions, scientists and persons involved with ornamental and
invasive species. Both available and unavailable biological, surveillance and economic
data was identified.

Results and Discussion:

The Statistics Office of the Department of Agriculture of Puerto Rico conducts an annual
survey of ornamental growers to gather information regarding production, sales value and
cultivated land area. This survey estimated the distribution per cultivar of the total sales
value at farm level in 2001. The following sales value sharing is ranked by its economic
importance: flowering plants, 27.4%; foliage, 23.0%; lawn, 22.7%; palm trees, 12.5%;
poinsettias, 8.2%; orchids, 4.6%; and cut flowers, 0.9%. In 1987, of the total farm sales
value, 85.6% was attributed only to foliage. Lawn contributed 7.8% and there were no









palm tree sales reported. The farm value of the ornamental commodity in Puerto Rico
doubled from 1987 to 2001 and showed a diversification in its cultivars.

In 2001 the growers reported the average sales value per cultivated area or unit. The
sales values per land cultivated were: flowering plants, $175,612 per hectare ($71,098 per
acre); foliage, $44,823 per hectare ($18,147 per acre); palm trees, $40,520 per hectare
($16,405 per acre); cut flowers, $19,975 per hectare ($8,087 per acre); and lawn, $19,965
per hectare ($8,083 per acre). The sales value per unit for poinsettias was $3.4; for
orchids, $3.01.

The External Trade (Junta de Planificacion 2001) statistics reported an import value of
$11.5 million in 2001; 70.1% of the imports came from the US and the rest from foreign
countries. Colombia is responsible for 47.2 % of the total import value from foreign
countries. Most of the imports of foreign countries are cut flowers. Costa Rica, Thailand,
China and Ecuador are other countries from which cut flowers are imported into Puerto
Rico.

The exportation from Puerto Rico to US and Caribbean islands accounts for $0.5 million;
54.9% of the exports were shipped to British and U.S. Virgin Islands and the other Lesser
Antilles. Puerto Rico stopped ornamental exports to the European market in 1998. In
1987 that market received 11.3% of the total exportation value.

The Department of Agriculture of Puerto Rico growers survey did not gather information
regarding costs of control, loss of production and diminished quality due to invasive
species. The survey lacks information related to market price at consumer level.

Biological Profile:

The biological data was gathered from scientists, local and federal regulatory plant
protection agencies, and persons involved with invasive species. Crop protection
scientists of the University of Puerto Rico provided information for pest and disease
introductions, spread, hosts and damage. The "Sanidad Vegetal" Division of the
Department of Agriculture of Puerto Rico and the Animal and Plant Health Inspection
Service (APHIS-USDA) provided information of interceptions, surveillance and spread
of the invasive species. Information from crop protection scientists and producers was
gathered in order to select the most important pests and diseases, per ornamental cultivar.
Table 1 presents a list of the most economically important established pests and disease
in the ornamental commodity. This table also includes a list of invasive species with risk
of future introductions.
















Table 1. --Pests and diseases of economic importance in the ornamental commodity
Cultivar Scientific name Common Name Effects


Flowering Plants,
Foliage, and Cut
Flowers


Cerococcus deklei






Maconellicoccus
hirsutus






Icerya Purchasii




Homoptera:
Aleyrodidae



Contarinia
macculipennis






Diaprepes
abbreviatus


Hibiscus scale,
grenade scale




Pink hibiscus
mealybug






Cottony cushion
scale



White flies





Blossom midge







Diaprepes root
weevil


Leaves turn yellow,
gradual defoliation,
few or none flowers,
drying branches,
cause plants dead

Direct losses caused
by feeding and
associated
physiological
disorders caused by
a toxin.

Turn yellow new
and younger stems,
reduce plants' grow
and strength

Turn leaves yellow,
defoliation, grow
reduction and virus
vector.

Causes deformed,
discolored buds and
blossoms, and in
severe infestations,
premature bud or
blossom drop.

The larvae are in the
soil where they feed
on the roots of the
host. They girdle the
taproot, resulting in
plant mortality.











Flowering Plants,
Foliage and Cut
Flowers


Lawn


Palms


Homoptera:
Aphididae

Rhizoctonia solani


Phytophthora spp.


Scapteriscus
abbreviatus

Scapteriscus
Didactylus

Scapteriscus vicinus

Scapteriscus
borelli/1


Rhizoctonia solani

Ceroplastes rubens.










Bursaphelenchus
cocophilus/1







Rhynchophorus
palmarum/1


Short winger mole
cricket

West Indian mole
cricket

Tawny mole cricket

Southern mole
cricket


Red wax scale










Red ring disease








Palm weevil


Virus vectors.


Major nursery plant
soil disease.

Quality losses on
petals and foliage
infected.
Damage seeding,
feeding
aboveground on
foliage or stem
tissue, and bellow
ground on roots.
Southern mole
cricket does much
more tunneling
injury than tawny
mole cricket.

Brown spots and,
withering.
Attacks palms and
cycads. Their
damage is greatest
on palms and can
cause yellowing of
the leaves with the
infestation of sooty
mould in shaded
areas.

Leaves become
short and deformed,
and turn yellow-
bronze. As leaves
change color and
dry up, they wilt and
die.

Red ring disease
vector.


1/ risk nf fntnrP intraduntiann


Cont. Table 1. --Pests and diseases of economic importance in the ornamental commodity


Cultivar Scientific name Common name Effects












Rhinostomus
barbirostris/1

Myndus crudus/1

Thielaviopsis
basicola


Bearded coconut
weevil


Red ring disease
vector.


Lethal yellow vector

Causes that plants
are stunted and roots
badly rotted.


Poinsettias Homoptera: White flies. Turn leaves yellow,
Aleyrodidae defoliation, grow
reduction and virus
vector.

Phytophthora spp. Quality losses on
petals and foliage
infected.
Orchids Contarinia Blossom midge Causes deformed,
macculipennis discolored buds and
blossoms, and in
severe infestations,
premature bud or
blossom drop.

Cymbidium mosaic Causes blotchy local
Cymbidium spp. virus lesions developing
slowly; not systemic

Bacterial soft rot Causes foliar spots
Erwinia carotovora and blights.





1/ risk of future introductions

The identification of the important pests and diseases in the ornamental commodity
allows us to identify institutions and persons involved with ornamental invasive species
management in Puerto Rico. Although there is a great amount of biological data for
physiological behavior of pests and diseases and records of intervention, introduction,
and surveillance, this information is unevenly diffused across agencies, scientists and
producers. It is necessary to compile the information in a way to facilitate exchange of
data and experience among groups. A link between crop protection scientists, regulatory
plant protection agencies and economists is needed. The groups need to develop a guide


Palms


Cont. Table 1. --Pests and diseases of economic importance in the ornamental commodity


Cultivar Scientific name Common name Effects









for asking questions that facilitates the gathering and compilation of data for economic
impact analysis.

Economic Impact: Identification of available data

The summary of the status of available data needed for economic impact evaluation is
reported. The summary classifies the data according to direct and indirect market effects
and non-markets effects.

Market Direct Impact:

Information related to valuation of benefit and cost of ornamental invasive species
is partially available. Information for quantities bought and sold and market
prices at farm level is available.
There is a lack of information of cost and returns. There is not aggregated
information for direct producer cost, and change in product quality due to pests
and disease. A growers survey has to be done to gather the direct producer costs
and changes in products quantity and quality.
There is a need to estimate the federal and commonwealth agencies' investment in
the intervention, surveillance and control of invasive species.
To determine pest impact on trade, international phytosanitary requirements for
ornamentals must be compiled.
The biological profile information related to invasive species' pathological or
physical effect, potential host, and established and future introductions is
available.

Market Indirect Impact:

The indirect market impact of ornamental invasive species in Puerto Rico is highly
related to the tourism sector. The beauty of the tropical scenarios is one of the
main attractions for visitors. The invasive species associated with ornamental
plants, especially palm trees, have the potential for a negative impact on the
tropical landscaping and, therefore, on tourism. Scientists have already identified
palm tree invasive species with a high introduction potential like, for example,
lethal yellow. There is available biological information for pest and diseases.
Economic information has to be gathered.

Non-Market Impact:

It is necessary to identify sources and gather information to estimate non-markets
environmental damage. Data related to the impact of invasive species on
ecological and hydrological native systems have to be gathered. It is necessary to
gather and analyze socioeconomic data for the estimation of the economic
externalities' effects on the environment.









References Cited:


Council for Science and Technology. 2002. Invasive Pest Species: Impact on
Agricultural Production, Natural Resources and Environment.. Issue Paper No. 20

Departamento de Agricultura de Puerto Rico. 2002. Ingreso Bruto Agricola 2000/2001.
Oficina de Estadisticas Agricolas, Santurce, Puerto Rico

Evans, E. A., Spreen, T. H. and Knapp, J.L. 2002. Economic Issues Of Invasive Pests
and Diseases and Food Safety. 2nd International Agricultural Trade and Policy
Conference. Gainesville, Florida.

Franqui, Rosa A. 2003. Invasive Species in Puerto Rico: History and Potential
Introductions. Unpublished data.

Junta de Planificacion de Puerto Rico. 2001. External Trade Statistics. Division de
Estadisticas de Comercio Exterior, Estado Libre Asociado de Puerto Rico, Oficina de la
Gobernadora

Junta de Planificacion de Puerto Rico. 2002. Informe Econ6mico a la Gobernadora
2001. Estado Libre Asociado de Puerto Rico. Oficina de la Gobernadora.

Serrano, Miguel S. y Rosa A. Franqui. 2001. Entomofauna Invasiva en Puerto Rico:
Historia y Potenciales Introducciones. Memorias del Foro de Especies Invasivas.
Sociedad Puertorriquefia de Ciencias Agricolas, Estaci6n Experimental Agricola, Rio
Piedras, Puerto Rico

U.S. Department of Agriculture (USDA). 2003. Economic Research Service: Invasive
Species Management: Definition and Importance. available on line at
http://www.ers.usda.gov//Briefing/InvasiveSpecies/whatis.htm




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