School of Economic Sciences

Agribusiness Management

A Brief Look at the Washington Apple Industry: Past and Present

by R. Thomas Schotzko and David Granatstein

This document is available in its entirety in pdf format.

pdf copy of report SES 04-05

Acreage in Washington

2001 Fruit Survey
2003 Estimate
Granny Smith


The geographic shifts mentioned above are particularly important to the apple industry and the communities that have grown up with the industry. There continue to be shifts in the location of production. The Columbia Basin is becoming more important in the industry as producers search for opportunities to increase size of operation and achieve some of the economies of size that are expected to occur. ...

A related issue is the belief within the industry that retail prices are no longer connected to FOB prices. Recent work done on behalf of WAC indicates that retailers do adjust prices as changes occur at FOB. However, the adjustments are not spontaneous nor are they symmetric. Falling FOB prices do result in lower retail prices, but the retailer does not pass 100% of the price decline on to the consumer. Part of the price decline is kept by the retailer. On the other hand, when FOB prices increase, all, or nearly all, of the increase is passed onto the consumer.

Although not directly related to price spreads, a few words regarding the demand for apples seems warranted. Economic studies over the years have generally yielded elasticity estimates below one. This means that as crop size increases the total value of the crop declines. The recent study done on behalf of WAC yielded results that continue to indicate the demand is inelastic (less than one). It is important to also recognize that the converse is true, i.e. when price increases in response to a decline in quantity (supply), the total value of what is sold increases. These are mathematical truisms that can actually be observed in the movement of crop value from year to year, as reported by the National Agricultural Statistics Service.

picture of the front cover of SES 04-05

A Brief Look at the Washington Apple Industry: Past and Present (If you have problems with the full document please see the two files below. The file has been split into a text portion and a separate appendix of figures.)

text version - appendix of figures


During the course of the first half of the 20th century the center of production shifted from the extreme eastern counties (primarily Whitman and Spokane) to Yakima, Chelan, Okanogan, and Douglas counties.

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