ISHS Acta Horticulturae 203: IX Symposium on Horticultural Economics, XXII IHC
MARKETING COORDINATION IN THE U.S. TART CHERRY INDUSTRY |
| Author: | Donald J. Ricks |
| Abstract:
The U.S. tart cherry industry has two major economic problems which are faced to varying degrees by most perennial crops. These problems include (1) long-term cycles in regard to the balance between industry orchard productive capacity and overall demand for tart cherries; and (2) wide annual fluctuations in the nation's production and, hence, market supplies. Although most perennial crop industries face these kinds of problems to some extent, the magnitude of these is unusually large for the tart cherry industry. Market co-ordination of long-run supplies with demand, as with most tree fruits, relies primarily on grower's planting and removal decisions influenced by prices received. When production increases, demand expansion receives greater emphasis both through generic industry efforts and by individual firms. Some co-operative processors also make use of tonnage contracts with their members as a means to balance grower's productive capacity to market demand. Additional approaches to balance long-run supply and demand may be used by the industry in the future. Co-ordination of wide annual fluctuations in supply involves large swings in prices of cherries. As a supplementary approach the industry has used a federal marketing order storage reserve pool to stabilize somewhat the annual fluctuations in available market supplies. The industry has also recently implemented a program to divert some excessive supplies in large-crop years to secondary markets. Year to year storage by individual processor firms has in the past been quite limited, although this approach might be used more extensively in the future. | |
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