Monday, July 6, 2009
Posted by D. Daniel Sokol
James E. Epperson (Georgia - Agricultural and Applied Economics) offers An Examination of the Market Structure of the U.S. Produce Industry.
ABSTRACT: Recent literature, largely from the U.S. Department of Agriculture, Economic Research Service, indicates that substantial changes have occurred in the produce industry in recent years. With the rise of retail mass merchandisers and increased concentration in the retail food industry, the procurement power of these large firms reportedly has also increased. With direct buying and contracting, market intermediaries such as brokers and wholesalers allegedly are being bypassed. As a result, these market intermediaries ostensibly are also consolidating becoming fewer and larger with increased emphasis on servicing the food service industry. However, the findings of this study indicate that there is no convincing evidence that the market structure of the U.S. produce industry has markedly changed since the early 1980s. While supermarket concentration has increased noticeably, the same cannot be said for produce market intermed! iaries such as brokers and wholesalers.