The Free Trade Area of the Americas and the Market for Processed Orange Products

The proposed Free Trade Area of the Americas would join the world's two largest processed orange producing regions: Brazil and the United States. Because the United States currently imposes a sizeable tariff on imported processed orange products, there is concern by U.S. orange growers over pos...

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Bibliographic Details
Published in:Journal of agricultural and applied economics 2003-04, Vol.35 (1), p.107-126
Main Authors: Spreen, Thomas H., Brewster, Charlene, Brown, Mark G.
Format: Article
Language:English
Subjects:
Agricultural commodities
C61
Consumption
F13
Foreign trade zones
Free trade
Fruit juices
International trade
North American Free Trade Agreement
orange juice
spatial equilibrium
Tariffs
trade
US exports
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Summary:The proposed Free Trade Area of the Americas would join the world's two largest processed orange producing regions: Brazil and the United States. Because the United States currently imposes a sizeable tariff on imported processed orange products, there is concern by U.S. orange growers over possible adverse effects resulting from tariff elimination. A model of the world processed orange market is developed as a spatial equilibrium model with implicit supply functions based on the dynamic behavior of orange production. The model is used to estimate the impact of U.S. tariff elimination on U.S. production, grower and processor prices, and imports. The results suggest a sizeable price impact on U.S. producers if the tariff is eliminated.
ISSN:1074-0708
2056-7405
1074-0708
DOI:10.1017/S1074070800005976