ANALYSIS OF THE EFFECTS OF RISING TRANSPORTATION COSTS ON CALIFORNIA'S FRESH FRUIT AND VEGETABLE MARKETS

This study analyzes the impacts of rising transportation costs, stemming from increased fuel costs, on California's market share for fresh fruits and vegetables. Fresh fruit and vegetable crops transported to Midwestern and Eastern markets were chosen for this analysis. Crops were divided into two categories: competitive and monopoly crops. A linear programming transportation model was developed for this analysis. This model allocates competitive crops among producing regions and markets in order to minimize total costs (the sum of production and transportation costs), subject to various production and consumption constraints. Results specify the optimal cropping pattern for each producing region and distribution mix from each producing region to each market. In addition, a sensitivity analysis determined the impact on California's market share as transportation costs rose. Regarding monopoly crops, the key question is whether consumers are willing to continue purchasing these commodities (and to what extent) as their prices rise due to rising transportation costs. Consumer demand equations were used to analyze these impacts. Results specify the reduction in consumer demand as transportation costs rise.

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  • Accession Number: 00618065
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Dec 31 1991 12:00AM