Eastern Broccoli Supply Chain Model, Poster Board #324

Broccoli is a major specialty crop in the United States with a farm-gate value of over $700,000,000. Rise of transportation costs and interest in local and regional food has led to efforts in the Eastern U.S. aiming at insuring a reliable, year-round supply of Eastern-grown broccoli that will be welcomed in East Coast markets. We collected data on fresh broccoli acreage, yields, production, and transportation costs from emerging broccoli-producing region in the East Coast (Maine, New York, Pennsylvania, Virginia, North Carolina, South Carolina, Georgia, and Florida) and the mainstream producing regions of  California and Arizona. Wherever data were not available, we visited growers and packer/shippers to complement it. We develop a mathematical programming model of the Eastern broccoli distribution system to examine optimal production sites and flows for broccoli grown in the East. The optimization model inputs are: seasonal supply in the aforementioned producing regions, demand in Eastern metropolitan areas and production and transportation costs. Given these inputs, the model minimizes the total costs of producing and transporting broccoli from supply sites to markets and solves for cost-effective seasonal product flows. We use the model to simulate the impact of increased localization on relative total costs. Preliminary analyses suggest that reducing the total miles travelled by broccoli (localization) by 20% increase supply chain costs by a modest 0.11%, with the highest increase occurring in the winter and the lowest in the summer. Localizing any further is feasible only if current Eastern production levels double. These relatively small increases in total costs contrast with large changes in the marginal values that are significant and varying by season and space. The increases in the value of a box of broccoli due to 20% localization vary from $0.18 to $4.77 (which is often more than 15% of the retail price). The largest increases in broccoli marginal values are found during off-production seasons in states that are farthest from the regions that are in production (e.g. Maine in the winter and spring seasons). Our results do not suggest that the retail prices of fresh broccoli would increase by those exact amounts. Instead, they serve to identify the broccoli-producing regions and the seasons where the marginal values are the most sensitive to increased localization.