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Competition and Trade in Fresh Fruits and Vegetables in the New Millennium
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Permanent Link: http://ufdc.ufl.edu/IR00001867/00001
 Material Information
Title: Competition and Trade in Fresh Fruits and Vegetables in the New Millennium
Physical Description: Fact Sheet
Creator: Taylor, Timothy G.
Publisher: University of Florida Cooperative Extension Service, Institute of Food and Agriculture Sciences, EDIS
Place of Publication: Gainesville, Fla.
Publication Date: 2000
 Notes
Acquisition: Collected for University of Florida's Institutional Repository by the UFIR Self-Submittal tool. Submitted by Melanie Mercer.
Publication Status: Published
General Note: "Published July 2000"
General Note: "FE 173"
 Record Information
Source Institution: University of Florida Institutional Repository
Holding Location: University of Florida
Rights Management: All rights reserved by the submitter.
System ID: IR00001867:00001

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Competition and Trade in Fresh Fruits and Vegetables in the New Millennium1 Timothy G. Taylor and Gary F. Fairchild2 1. This is EDIS document FE 173, a publication of the Department of Food and Resource Economics, Florida Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida, Gainesville, FL. Published July 2000. Please visit the EDIS web site at: http://edis.ifas.ufl.edu. 2. Timothy G. Taylor and Gary F. Fairchild, professors, Department of Food and Resource Economics, Florida Cooperative Extension Service, Institute of Food and Resource Economics, University of Florida, Gainesville, FL 32611. The Institute of Food and Agricultural Sciences is an equal opportunity/affirmative action employer authorized to provide research, educational information and other services only to individuals and institutions that function without regard to race, color, sex, age, handicap, or national origin. For information on obtaining other extension publications, contact your county Cooperative Extension Service office. Florida Cooperative Extension Service/Institute of Food and Agricultural Sciences/University of Florida/Christine Taylor Waddill, Dean. This is a summary of a paper presented at a national conference entitled Global Agricultural Trade in the New Millennium, held May 25-25, 2000, in New Orleans, Louisiana. Seventy international trade economists presented analyses of the impacts and issues related to major changes in trade and trade policy expected over the next several years. Highlights: Four of the most important factors influencing fresh fruit and vegetable trade are trade policy, the retail segment, technological innovation, and developments in information management and organization of supply chains. Trade policy may become less important than national policies in determining the extent and structure of trade in the future as borders blur with increased globalization of supply chains. Perhaps the most profound impact on trade and competition will be created by changes in information technology as supply chains evolve to minimize the cost of information flow and its management. Trade in fresh fruits and vegetables has exhibited a generally increasing trend over the past 30 years. When viewed against major trade agreements, trade liberalization has served to accelerate growth in trade, rather than cause significant departures from previous trade patterns. Fresh fruits and vegetables are largely unaffected by domestic agricultural policy and were placed on the "import sensitive" list, which slowed the rate of tariff reductions. There has been significant growth in trade among NAFTA partners. The EU and Asia-Pacific regions are becoming increasingly important export markets, especially for fresh fruits. While the WTO has had some impact, unilateral country actions and the increased presence of multinationals have also influenced trade. There is some proliferation in the regions to which the U.S. is exporting, as well as diversification of countries supplying the U.S. In addition, trade patterns demonstrate the continued role of perishability and suggest that the geographic distribution of trade is highly correlated with the degree of perishability. Four of the most important factors influencing fresh fruit and vegetable trade are trade policy, the retail segment, technological innovation, and developments in information management and organization of supply chains. While the past 15 years

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Competition and Trade in Fresh Fruits and Vegetables in the New Millennium 2 have witnessed significant trade policy impacts on trade, further refinement in sanitary and phytosanitary (SPS) regulations, food safety, and market access will continue to affect trade flows. However, trade policy may become less important than national policies in determining the extent and structure of trade in the future as borders blur with increased globalization of supply chains. The retail food sector has become increasingly concentrated and the wholesale sector has declined dramatically as long-term retailer/grower-shipper contracts have increased. The retail sector's desire for a continual supply of a large array of products is stimulating global strategic alliances. Increasing incomes relative to fresh produce prices have increased the demand for high quality and convenience. The potential is great for biotechnology to decrease economic constraints imposed by perishability, although consumer acceptance of genetically modified products remains uncertain. Innovations in post-harvest handling and transportation have improved significantly, increasing the geographic scope of trade. Increased consumption and trade of greenhouse products suggest that capital-intensive production systems may become more important. Perhaps the most profound impact on trade and competition will be created by changes in information technology. Supply chains evolve to minimize the cost of information flow and its management, thus transaction costs along the supply chain have been altered by access to real-time information at very low cost. Examples include the decline of traditional wholesale distribution channels and the increase in vertical and horizontal strategic alliances in the fresh fruit and vegetable sub-sector. For a complete copy of this paper, please contact Timothy G. Taylor, Gary F. Fairchild, or Janice Baisden at the following e-mail addresses: tsquare@ufl.edu fairchild@fred.ifas.ufl.edu baisden@fred.ifas.ufl.edu