Optimal timing and quantity of sale of Arizona apples

Abstract

Arizona apple producers compete with Washington for fresh apple markets. As Arizona's apple production increases, its market share should also increase. Using quadratic programming to determine the spatial equilibrium between the wholesale markets of Los Angeles and Denver, the timing and quantity of apple sales from Arizona to these two wholesale markets are determined for current and potential fresh apple production in Arizona. The quadratic programming model is used to determine the feasibility of controlled atmosphere storage for Arizona. The quantity of apples sold monthly to Los Angeles and Denver wholesale markets are determined given restrictions on the percentage of the wholesale markets that Arizona apple producers could supply. Revenue from controlled atmosphere storage exceeds the variable costs associated with storage, marketing, and storage of apples.