• Sewing terror: price dynamics of the strawberry needle crisis

      Schaefer, K. Aleks; Scheitrum, Daniel; Univ Arizona, Dept Agr & Resource Econ (WILEY, 2020-02-16)
      In September 2018, a former strawberry-picking supervisor for a strawberry farm in New South Wales was arrested for inserting sewing needles in hundreds of punnets of fresh strawberries sold in retail stores across several Australian states. This paper analyses the 2018 Australian strawberry needle scare as a case study on the market impacts of agro-terrorism events. We develop a novel four-step procedure to estimate the effects of the strawberry needle contamination on wholesale fresh strawberry prices. Our results indicate a drop in wholesale fresh strawberries prices of about 20% while the needle crisis was ongoing. However, public and private supply restrictions caused wholesale prices to rise by up to 94% relative to expected dynamics over several weeks in the immediate wake of the incident.