An analysis of import demand for U.S. fresh citrus in Japan

Export markets for fresh citrus have taken on increasing importance in the last decade with more important increase in the Japanese market. Japan is one of the largest import markets for U.S. fresh citrus. Fresh fruit plays a special role in Japanese life, from both a cultural and economic point of view. The long-term outlook for U.S. fresh fruit is for gradual, steady growth. Many factors have helped the U.S. fresh citrus exports. The reasons are: 1) exports have benefitted from the depreciation of the U.S. dollar since 1985; 2) rising world -wide incomes; and 3) U.S. market promotion activities. The healthfulness of foods, and particularly fresh foods, is becoming more important in Japan as it is in the United States. The purpose of this study was to examine the import demand for fresh citrus in Japan and analyze the nature of price and expenditures linkages. The Almost Ideal Demand System (AIDS) of Deaton and Muellbauer (1980a, 1980b) was applied to model the Japanese market from 1991 - 1996. The findings of study indicated that fresh grapefruit dominates the import demand market for Japan, followed closely by fresh oranges. Fresh other citrus types indicated relative small importance to the Japan market. Also results show that price and quantity of fresh citrus exports have had an important effect on Japanese expenditures on imports of fresh citrus. Analysis suggests that U.S. producers can effectively promote fresh citrus in Japan market and trade negotiations between the U.S. and Japan can influence fresh citrus exports