CHANGING MARKET CHANNELS FOR FRESH FRUITS AND VEGETABLES AND IMPLICATIONS FOR THE STRUCTURE OF THE FARM SECTOR

The per capital consumption of fresh fruits and vegetables is still increasing in almost all countries but the ongoing consolidation in the retail market challenges the traditional vertical market coordination of the fresh fruit and vegetable sector which for a long time was dominated by spot markets.
Retailers are backward integrating parts of the wholesale business and the share of produce moving directly from large growers to retailers is increasing and booth sides are engaging in a wide range of contractual agreements.
In response to this a structural change of the farm can be observed: farms are growing and specializing on a few crops, forming new cooperatives and alliances and providing customer designed products.
The paper contrasts the described empirical findings in the farm sector with different economic theories in order to find some key drivers for this development.
Based on this analysis, an attempt is made to outline what options may be open for the farm sector to respond to the emerging new vertical market coordination along the supply chain.

XV International Symposium on Horticultural Economics and Management

W. Lentz

economic theory, market coordination; farm sector development

https://doi.org/10.17660/ActaHortic.2004.655.7