A Demand Analysis for Fresh Tomatoes in the Dallas/Fort Worth Grocery Market.
Keywords:Disaggregated tomato elasticities, scanner data, tomato types, demand system
AbstractTomato consumption and production have been rapidly increasing. With most of the U.S. tomatoes produced being processed, tomato imports for the fresh market are significantly greater than tomato imports for the processed market. Consequently, it is critical and increasingly valuable for fresh-market producers who sell directly to grocery chains, farmers’ markets, and food service providers to analyze emerging consumption trends as well as the substitution patterns among different types of tomatoes and vegetables. This study uses the Almost Ideal Demand System (AIDS) to estimate the demand parameters for fresh tomatoes in the Dallas/Fort Worth grocery market using home-scanned data for the year 2012. Unlike previous fresh fruit and vegetable studies, the study reports disaggregated tomato elasticities, including Hicksian and Marshallian price elasticities and expenditure elasticities. The analysis identifies tomato types that are highly marketable in the Dallas/Fort Worth metropolitan area and provides insight on tomato varieties that could be grown for the region.
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