Exchange Rates and The Export Demand for U.S. Grapefruit Juice

As the U.S. domestic demand for fresh grapefruit and grapefruit juice trends downward, the export markets become more and more important for the citrus industry. Prior research suggests that when studying export demand relationships, exchange rates play an important role. The purpose of this research project was to study the relationship between exchange rates and foreign demand for U.S. grapefruit juice. Monthly observations for the period from 1989 to 2007 were used in the analysis. The seemingly unrelated regression was used to estimate the demand equations for grapefruit juice by major importing country/region. The results of this study support prior research findings.