Elasticity of Export Demand for Australian Sugar: Accounting for Regional and Seasonal Effects

The elasticity of export demand for Australian sugar is an important measure for devising sugar export marketing strategies and considering the impact of various policies on the industry. Updated and more explicit elasticities of export demand for Australian sugar are reported in this paper. The elasticities are calculated using an adaptation of the formula approach published by Cronin (1979). Initially elasticities are reported for Australia without accounting for regional and seasonal effects. These effects are then introduced and the consequences for the revised elasticities are analysed. The importance of export market share by region and season is emphasised. Comparisons of the elasticities with other studies highlight the value of the formula approach to deriving export demand elasticities.