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U.S. Import Demand for Tilapia from Selected FTAA Countries

Author

Listed:
  • Ligeon, Carel
  • Bayard, Budry
  • Clark, Joy M.
  • Jolly, Curtis M.

Abstract

Seafood consumption in the U.S. has increased over the period 1990 to 2003. A large percentage of the seafood consumed in the U.S. is imported. The most important seafood products imported to the U.S. are shrimp, Atlantic salmon, tilapia, catfish, crayfish, mussels and a mixture of mollusks. In 2003, the U.S. imported 199 million pounds of tilapia and tilapia products, at a value of $241.2 million, a 38% increase from the previous year. The seafood market has been considered an important foreign exchange earner for the Caribbean Common Market (CARICOM), and Free Trade Area of the Americas (FTAA) member countries. Jamaica is the only CARICOM country that exports tilapia products from aquaculture sources to the U.S. In 2003, Jamaica exported 39,950 pounds of frozen tilapia fillet to the U.S. at a value of $77,952 (Aquaculture Outlook, 2004). Given that tilapia culture may be a promising enterprise for CARICOM and FTAA member countries, it is important to evaluate changes in U.S. market demand for tilapia from CARICOM countries. A Source Differentiated Almost Ideal Demand System (SDAIDS) model was used to conduct an import demand study for tilapia and tilapia products in the U.S. The own price elasticity of Jamaica frozen fillet was found to be -0.23, and significant which means that it is price inelastic and which means that increases in exports, other factors remaining constant, may lead to a fall in total revenue. The Jamaican frozen fillet is complementary to that of the rest of the world (ROW) and fresh fillet from Ecuador, but competitive (substitute) to fresh-frozen fillet from Thailand. Fresh fillet from Ecuador, with a cross price elasticity of 0.29, is a substitute for the fresh fillet from Costa Rica. The fresh fillet from Costa Rica is complementary to the fresh-frozen from Thailand. The fresh fillet from Honduras with a cross price elasticity of 1.13 is a substitute for the fresh fillet from Ecuador. However, the fresh fillet from Honduras is a complement to the frozen fillet from Thailand. Seafood consumption in the U.S. has increased over the period 1990 to 2003. A large percentage of the seafood consumed in the U.S. is imported. The most important seafood products imported to the U.S. are shrimp, Atlantic salmon, tilapia, catfish, crayfish, mussels and a mixture of mollusks. In 2003, the U.S. imported 199 million pounds of tilapia and tilapia products, at a value of $241.2 million, a 38% increase from the previous year. The seafood market has been considered an important foreign exchange earner for the Caribbean Common Market (CARICOM), and Free Trade Area of the Americas (FTAA) member countries. Jamaica is the only CARICOM country that exports tilapia products from aquaculture sources to the U.S. In 2003, Jamaica exported 39,950 pounds of frozen tilapia fillet to the U.S. at a value of $77,952 (Aquaculture Outlook, 2004). Given that tilapia culture may be a promising enterprise for CARICOM and FTAA member countries, it is important to evaluate changes in U.S. market demand for tilapia from CARICOM countries. A Source Differentiated Almost Ideal Demand System (SDAIDS) model was used to conduct an import demand study for tilapia and tilapia products in the U.S. The own price elasticity of Jamaica frozen fillet was found to be -0.23, and significant which means that it is price inelastic and which means that increases in exports, other factors remaining constant, may lead to a fall in total revenue. The Jamaican frozen fillet is complementary to that of the rest of the world (ROW) and fresh fillet from Ecuador, but competitive (substitute) to fresh-frozen fillet from Thailand. Fresh fillet from Ecuador, with a cross price elasticity of 0.29, is a substitute for the fresh fillet from Costa Rica. The fresh fillet from Costa Rica is complementary to the fresh-frozen from Thailand. The fresh fillet from Honduras with a cross price elasticity of 1.13 is a substitute for the fresh fillet from Ecuador. However, the fresh fillet from Honduras is a complement to the frozen fillet from Thailand. The FTAA member states, other than Ecuador, are not major players in the frozen whole tilapia market. Large non-member countries, such as Thailand, Taiwan, and China, may be serious threats to CARICOM and FTAA member country tilapia products in the U.S. market. The FTAA member countries have concentrated on the fresh-frozen fillet and may have a comparative advantage for this product line because of proximity to the market.

Suggested Citation

  • Ligeon, Carel & Bayard, Budry & Clark, Joy M. & Jolly, Curtis M., 2007. "U.S. Import Demand for Tilapia from Selected FTAA Countries," Farm and Business - The Journal of the Caribbean Agro-Economic Society, Caribbean Agro-Economic Society, vol. 7(1), pages 1-29.
  • Handle: RePEc:ags:fabtho:36805
    DOI: 10.22004/ag.econ.36805
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    Citations

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    Cited by:

    1. Wang, Xiaojin & Reed, Michael, 2013. "Estimation of Import Demand for Fishery Products in the U.S. Using the Source-Differentiated AIDS Model," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150207, Agricultural and Applied Economics Association.
    2. Kehar Singh & Madan M. Dey & Prasanna Surathkal, 2014. "Seasonal and Spatial Variations in Demand for and Elasticities of Fish Products in the United States: An Analysis Based on Market-Level Scanner Data," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 62(3), pages 343-363, September.

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