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Brazilian frozen concentrated orange juice : the folly of unfair trade cases

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  • Primo Braga, Carlos Alberto
  • Silber, Simao Davi

Abstract

Brazil dominates the international market for frozen concentrated orange juice. By the mid 1980s, Brazil accounted for about 80 percent of world exports of the product. Brazilian producers supplied more than 94 percent of U.S. imports of the product in the 1980s and accounted for 50 percent of sales in the U.S. market. The dynamism of the Brazilian industry is attributable to Brazil's comparative advantage and to the series of climate shocks to Florida's orange groves. In Brazil, the industry is largely in the hands of four large firms, who sell 80 percent of their products to a few large U.S. firms, at significant price rebates. Florida orange growers, beset by import competition and climate shocks, turned to unfair trade laws for protection in the early 1980s, relying on them increasingly as a substitute for safeguard actions. Because of Brazil's interventionist trade policies, the prevailing U.S. belief was that any Brazilian industry was guilty of unfair trade practices until proven innocent. Unfair trade actions have had a particularly negative impact on their supposed beneficiary, the U.S. citrus industry. The antidumping cases were used to protect orange growers at the expense of U.S. juice processors. Their effect has been to strengthen the oligopoly-oligopsony relationship between Brazilian producers and their U.S. partners, further hindering the competition prospects in the world market for frozen concentrated orange juice.

Suggested Citation

  • Primo Braga, Carlos Alberto & Silber, Simao Davi, 1991. "Brazilian frozen concentrated orange juice : the folly of unfair trade cases," Policy Research Working Paper Series 687, The World Bank.
  • Handle: RePEc:wbk:wbrwps:687
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    References listed on IDEAS

    as
    1. Deardorff, A.V., 1989. "Economic Perspectives On Dumping Law," Working Papers 240, Research Seminar in International Economics, University of Michigan.
    2. repec:fth:michin:240 is not listed on IDEAS
    3. World Bank, 1989. "World Development Report 1989," World Bank Publications - Books, The World Bank Group, number 5972.
    4. Finger, J. Michael & Murray, Tracy, 1990. "Policing unfair imports : the U.S. example," Policy Research Working Paper Series 401, The World Bank.
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    Cited by:

    1. Independent Evaluation Group, 2006. "Assessing World Bank Support for Trade, 1987-2004 : An IEG Evaluation," World Bank Publications - Books, The World Bank Group, number 6966.
    2. Carter, Colin A. & Chalfant, James A. & Yavapolkul, Navin & Carroll, Christine L., 2016. "International commodity trade, transport costs, and product differentiation," Journal of Commodity Markets, Elsevier, vol. 1(1), pages 65-76.

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