Industry Networks and Sustainable Competitive Advantages in Brazilian and U.S. Processed Citrus Supply Chains

The states of Sao Paulo, Brazil and Florida, United States collectively dominate the world supply of orange juice. Collectively, these two regions account for over 80 percent of world processed orange production (Spreen, et al). Florida is the prime supplier to the United States and Canada, while Sao Paulo dominates world trade of orange juice and is the primary supplier to the EU market. It is these three markets - the United States, Canada and the EU - that represent the vast majority of global consumption of processed orange products (Spreen). The global dominance by these two national industries is being threatened. Both the Florida and Sao Paulo citrus industries are experiencing outbreaks of the same potentially devastating diseases - citrus canker (Xanthomonas axonopodis pv. citri) and citrus greening (Liberibacter asiaticus). Citrus canker forms lesions on fruit, causing premature fruit drop and rendering the fruit unsuitable for fresh market sales. "In addition to lowering yields, there is likely some increase in tree mortality as canker may open pathways for other diseases ... [though] tree mortality is not the major concern with endemic citrus canker (Spreen, et al., p. 14-5)." On the other hand, citrus greening, as observed in Asia, has had devastating effects on citrus production, leading to very high rates of tree mortality. As greening is quite new to both Sao Paulo and Florida, the actual magnitude of this threat is still unknown, but most industry observers are openly concerned about the potential for significant losses of citrus trees.