Industry Networks and Sustainable Competitive Advantages in Brazilian and U.S. Processed Citrus Supply Chains

The states of Sao Paulo, Brazil and Florida, United States collectively dominate the world supplyof orange juice. Collectively, these two regions account for over 80 percent of world processedorange production (Spreen, et al). Florida is the prime supplier to the United States andCanada, while Sao Paulo dominates world trade of orange juice and is the primary supplier tothe EU market. It is these three markets - the United States, Canada and the EU - that representthe vast majority of global consumption of processed orange products (Spreen).The global dominance by these two national industries is being threatened. Both the Florida andSao Paulo citrus industries are experiencing outbreaks of the same potentially devastating diseases - citrus canker (Xanthomonas axonopodis pv. citri) and citrus greening (Liberibacter asiaticus).Citrus canker forms lesions on fruit, causing premature fruit drop and rendering the fruitunsuitable for fresh market sales. "In addition to lowering yields, there is likely some increasein tree mortality as canker may open pathways for other diseases ... [though] tree mortality is notthe major concern with endemic citrus canker (Spreen, et al., p. 14-5)." On the other hand, citrusgreening, as observed in Asia, has had devastating effects on citrus production, leading to veryhigh rates of tree mortality. As greening is quite new to both Sao Paulo and Florida, the actualmagnitude of this threat is still unknown, but most industry observers are openly concernedabout the potential for significant losses of citrus trees.