value of the revenue change over the 12-year period. Next, this net present value was converted

to an annualized value using the formula

 A = r NPV
 1-(1+r)-12


where r is the real rate of interest and NPV is the net present value of the FOB revenue change

over the 12-year forecast horizon. The conversion factor in this equation is called the capital

recovery factor (Grant et al., 1976, p. 35 or Crane, 1979, p. 29). A computation was made for

on-tree revenues for each variety. The results are shown in Table 5.9.


Oranges. Tangelos. and Tangerines

 Given the small impact the methyl bromide ban had on the allocation of grapefruit

between fresh and processed utilization and the small utilization of fresh oranges, tangelos, and

tangerines relative to total utilization of these varieties for processing, it was determined that

analysis of a methyl bromide ban on these citrus varieties could focus entirely on the fresh

market.

 Using price flexibilities recently estimated by Brown and Muraro (1993) and validated

using the 1991-92 marketing season, log linear demand functions were derived for fresh oranges,

tangelos, and tangerines. In Table 5.10, the prices, quantities, and price flexibilities used for

this computation are presented.

 Using a methodology similar to that for grapefruit, the intercepts of the demand equations

were adjusted to account for the loss of markets in other citrus producing states. Using 1991-92

production levels and the modified demand equations, estimated FOB revenue losses were

derived. These figures are shown in Table 5.11.

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