Dynamic regional model of the US apple industry: Consequences of supply or demand shocks due to pest or disease outbreaks and control

Abstract

The apple industry is the largest temperate tree fruit crop in the United States and like other plant crops it is subject to pest or disease outbreaks. In this study we examine the economic impacts of pest or disease outbreaks on producers (in different regions) and on consumers (domestic and or international) using a dynamic regional model of the apple industry. The model divides US apple production into four regions that are subject to idiosyncratic production methods, varietal choice, and consumption patterns. Using this type of model the outcomes and impacts on various stakeholders in the apple industry; producers, consumers, and market intermediaries, such as fruit packers or processors, can be measured. Shocks, representing pest or disease outbreaks on tree population dynamics or fruit yields or their consequences on consumer (international and or domestic) markets to pest or disease outbreaks or controls, enter the model exogenously. The outcomes show heterogeneous impacts by type of shock, due to industry structure and regional allocation of apples to fresh or processed markets, on consumer, intermediary, and producer welfare.