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How Transport Costs Affect Fresh Fruit and Vegetable Prices

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Author Info

  • Volpe, Richard
  • Leibtag, Ephraim
  • Roeger, Edward

Abstract

This report examines the ways that fuel prices are transmitted to wholesale produce prices via transportation costs. Specifically, it focuses on marketing costs for asparagus,cantaloupes, table grapes, oranges, bell peppers, and tomatoes. Results of the study indicate that transportation costs significantly increase the costs of marketing these produce items and therefore their wholesale price. The impact of fuel prices on produce prices depends on a number of factors, including the distance between wholesale markets and the source of the produce, the method of transportation, the importance and timing of imports, and commodity-specific factors such as perishability. Overall, as fuel prices rise, so do wholesale produce prices and the margins between farm and wholesale prices.

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File URL: http://purl.umn.edu/161355
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Bibliographic Info

Paper provided by United States Department of Agriculture, Economic Research Service in its series Economic Research Report with number 161355.

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Date of creation: Nov 2013
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Handle: RePEc:ags:uersrr:161355

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Related research

Keywords: price determination; transportation costs; wholesale price margins; fruits and vegetables; trade; Agribusiness; Crop Production/Industries; Demand and Price Analysis; Industrial Organization;

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  1. Martinez, Steve & Hand, Michael & Da Pra, Michelle & Pollack, Susan & Ralston, Katherine & Smith, Travis & Vogel, Stephen & Clarke, Shellye & Lohr, Luanne & Low, Sarah & Newman, Constance, 2010. "Local food systems: concepts, impacts, and issues," MPRA Paper 24313, University Library of Munich, Germany.
  2. Abebayehu Tegene, 2009. "High and Volatile Commodity Prices: What Do They Mean for Food Prices and Consumers: Discussion," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(5), pages 1468-1469.
  3. Wendt, Minh & Todd, Jessica E., 2011. "The Effect of Food and Beverage Prices on Children's Weights," Economic Research Report 134705, United States Department of Agriculture, Economic Research Service.
  4. Raper, Kellie Curry & Thornsbury, Suzanne & Aguilar, Cristobal, 2009. "Regional Wholesale Price Relationships in the Presence of Counter-Seasonal Imports," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 41(01), April.
  5. Calvin, Linda & Cook, Roberta L. & Denbaly, Mark & Dimitri, Carolyn & Glaser, Lewrene K. & Handy, Charles R. & Jekanowski, Mark D. & Kaufman, Phillip R. & Krissoff, Barry & Thompson, Gary D. & Thornsb, 2001. "U.S. Fresh Fruit and Vegetable Marketing: Emerging Trade Practices, Trends, and Issues," Agricultural Economics Reports 33915, United States Department of Agriculture, Economic Research Service.
  6. Christopher L. Gilbert, 2010. "How to Understand High Food Prices," Journal of Agricultural Economics, Wiley Blackwell, vol. 61(2), pages 398-425.
  7. Goodwin, Harold L., Jr. & Fuller, Stephen W. & Capps, Oral, Jr. & Asgill, Oladimagi W., 1988. "Factors Affecting Fresh Potato Price In Selected Terminal Markets," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 13(02), December.
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