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764. Multicommodity Fresh Produce Trade Networks with Quality Deterioration Under Congestion and Transportation Capacities
Invited abstract in session MC-12: Agrifood supply chain decision problems, stream OR in Agriculture and Forestry .
Monday, 12:30-14:00Room: 13 (building: 116)
Authors (first author is the speaker)
| 1. | Deniz Besik
|
| Analytics & Operations, University of Richmond | |
| 2. | Anna Nagurney
|
| Department of Operations and Information Management, University of Massachusetts Amherst |
Abstract
This paper constructs a multicommodity spatial price equilibrium framework designed to allow for the quantification of the impacts of congestion and transportation capacities on trade flows and product prices while capturing the degradation of fresh produce quality through explicit quality deterioration formulas. We present the multicommodity fresh produce trade network model under equilibrium conditions both without and with minimum quality standards. Alternative variational inequality formulations of the governing equilibrium conditions are derived, with one of them exhibiting particularly favorable features for computational purposes. The numerical examples focus on the banana trade, since bananas are the most widely traded fresh produce commodity globally, with leading exporters being Ecuador and Costa Rica and major importers, United States and the European Union. Through various scenarios, we simulate congestion and time delays in the Panama Canal and report on the impacts of ongoing disruptions, on shipment times, equilibrium shipment volumes, the supply and demand prices, quality levels at the supply markets and at the demand markets, and transportation costs. Our baseline numerical example results closely align with real-life data on export volumes of bananas, the associated supply and demand prices, and transportation costs. The comprehensive numerical results reveal that reductions in transportation capacity and prolonged shipment times, as in the Panama Canal.
Keywords
- Game Theory
- Graphs and Networks
- OR in Agriculture
Status: accepted
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