Notably The Pineapple Industry In Australia

Notably, the pineapple industry in Australia is purely domestic. Queensland production of pineapples is marred by high production rates and slow growth rates.Also,labor shortage is dominant in this market.Noteworthy,the processing plant industry has also declined by 78% following stiff competition from imported pineapple products.Predominantly,Queensland is the main producer of pineapples in Australia.Further,84,721tonnes of Pineapple were produced in 2010 with 5% of it being exported.Also,the pineapple industry in Australia was valued at $73.2 million dollars(Sanewski and Newett,2012)

The pineapple market is the subject of the article. The agricultural industry hosts the pineapple industry. Predominantly, Pineapples in Australia are grown in the state of Queensland. However, the pineapple market has been adversely affected by excessive sun rays in the pineapple farms leading to low volumes of harvestable Pineapples. Low production of pineapples implies that most farmers will lose their crops thus low revenue and low profit margins. Consequently, there’s a strong likelihood to price increase by farmers. This is because of few quantities of harvested pineapples and the extra cost of purchasing and supplying sunblock. Inevitably affecting the supply and demand of pineapples.

Noteworthy, application of the sunblock is an innovative move by farmers to protect their pineapple crops from the harmful and excessive rays of the sun .This will in turn increase the cost of production for the pineapple farmers. Subsequently, the demand and supply of pineapples will be affected by increase in price. Also, the sunblock application on the pineapples causes no quality reductions hence its suitability and convenience to pineapple harvesters, canneries and consumers. Quality and safe pineapple harvests are likely to increase the profits of the farmers due to possible price increase.

Estimated Price elasticity of selected Fruits.

Source: FAO Corporate Document Repository.

Available at https://www.fao.org/docrep/007/y5445e/y5445e0g.htm

Price elasticity could be elastic, inelastic or unitary elastic.Predominantly,a value greater than one is considered elastic, a value lesser than one inelastic and an equal value of one is considered unitary.Usually,an increase in price of a product or service leads to change in quantity demanded which eventually affects the revenue.

New equilibrium price

Consequently, the total revenue will reduce due to the price increase. The fairly price elasticity of the pineapple industry will cause fewer demand thus fewer pineapples will be sold which translates to reduced revenue. For each price hike of -1.35 the demand for pineapples reduces hence few sold pineapples. Equally, a price decrease by the same elasticity will cause the revenue to go upwards. Notably, this is because more pineapples will be sold due to low prices thus increase in total revenue.                                        

Notably, environmental degradation is a dominant negative externality in most markets of production. Cutting down of forests and expansion to wetland areas in a bid to expand farming of pineapples by aspiring large scale pineapple farmers is a growing concern for most economies. Also, use of excessive or potentially harmful agrochemicals to boost the production volumes and quality of pineapples is an inevitable contributor to soil and general land degradation. Consequently, there will be environmental pollution which will affect air quality around the affected areas (Martin, 2016)

In addition, soil fertility will be affected  and eventually lead to poor harvest thus less revenue for  the government.However,large scale pineapple production leads to increased revenue for the government.Naturally,small pineapple yield will in turn lead to low revenue margins and vice versa. Taxation by the government on farming equipment’s and tools of production raises revenue for the government which will in turn afford to offer quality basic products and services to its citizens at affordable prices (Martin, 2016)

Predominantly, innovation has been developed through research and development of better farming practices and equipment.Moreover,innovation has created employment opportunities for scientists and researchers(Pettinger,2016) Positively, agriculture promotes  entrepreneurship, self-reliance, dignity of nature through proper farming practices and maintains good quality of air and the environment.However,poor farming techniques reduce land value, loss of biodiversity, soil erosion among other negative externalities’ on the environment.(BlogBio2,2016)

Consequently, Organic agriculture has been proposed to help prevent and reduce environmental pollution through use or organic manure and other practices instead of chemicals especially  pesticides and fertilizers .Subdsequently,the government of Australia should regulate farming practices through regulation and imposition of stiffer fines and levies in the case of environmental degradation practices(Blogbio2,2016)Funding of Research and development initiatives are a way to ensure technological advancements on good farming practices and equipment .

References

Blogb2bio (n.d.) Agriculture Negative extrenalities.Retrieved from https://www.b2bio.bio/en/noticias-productos-ecologicos/agriculture-negative-externalities

Food and Agriculture Organization. (n.d)Section 4: Market saturation and adding up. Retrieved from https://www.fao.org/docrep/007/y5445e/y5445e0g.htm

Sanewski, G and Newett, S. (2012) Industry Situation Statement Pineapple. Horticulture Industry Network. Retrieved from https://www.hin.com.au/resources/industry-situation-statement-pineapple

Martin, A. (2016) The sour side of Pineapple Production. Duke: Nicholas School of the Environment. Retrieved From https://blogs.nicholas.duke.edu/exploring-green/the-sour-side-of-pineapple-production

Pettinger, T. (2016).Problems of Agriculture-Market failure.Economics.Help.Retrieved from https://www.economicshelp.org/blog/4977/economics/problems-of-agriculture-market-failure/

Pretty, J., Brett, C., Gee, D et.al. (2013) Policy Challenges and priorities for internalizing the externalities of modern Agriculture. Retrieved from https://www.julespretty.com/wp-content/uploads/2013/09/2.-JEPM-pdf.pdf