Agricultural Economics and Development

Agricultural Economics and Development

Explanation of Export Clusters of Iran’s Cherry Based on Prioritization of Target Markets

Document Type : Original Article

Authors
Atabak Kazempour Kahriz 1
Hamed Rafiee 2
Seyed Safdar Hosseini 3
1 PhD Student in Agricultural Economics, Faculty of Economics and Development, University of Tehran, Karaj, Iran.
2 Associate Professor, Department of Agricultural Economics, Faculty of Economics and Development, University of Tehran, Karaj, Iran .
3 Professor, Department of Agricultural Economics, Faculty of Economics and Development, University of Tehran, Karaj, Iran.
10.30490/aead.2024.366011.1602
Abstract
Introduction: Nowadays, there is interdependence between the economies of different countries and it is difficult to find a country that has a closed economy. In other words, all the economies of the world are interconnected, but the degree of openness of the economy varies from country to country. One of the ways to reach global markets in developing countries is to develop the export of non-oil products, especially agricultural products. In this regard, it is necessary to know the country’s products and activities that have a comparative advantage and the potential to influence the global market. With the production of 105,000 tons of cherries and having a share of four percent of the total global production of this product in 2022, Iran has ranked third among the top producers of this product in the world. However, despite the high potential in cherries production, Iran has never been able to gain a suitable position among the exporters of this product in the world and take proper advantage of its capacities in exporting this product. On the other hand, the lack of comprehensive research on determining appropriate target markets and clustering them to active presence in it, the issue of choosing the right target market of agricultural products in developing countries, including Iran, is one of the important issues that is given less attention in the course of the economic development of the agricultural sector. Therefore, considering the importance of choosing the right export markets in terms of the producers’ income and the development of agricultural products export, this study aimed at investigating the export market structure as well as conducting the prioritization and clustering of the export target markets of cherries product during 2003-2022.
Materials and Methods: This research investigated the structure of the export market, followed by prioritization and clustering of the export target markets of Iranian cherries curing 2003-2022. For this purpose, first, by using Concentration Ratio (CR) and Herfindahl-Hirschman Indicator (HHI), the commercial pattern and export market structure of Iranian cherries were examined; and in order to prioritize and cluster target markets of Iranian cherries, numerical taxonomy and k-means analysis methods were used, respectively. It is worth mentioning that in the present study, in order to reach the desired goals regarding the prioritization and clustering of the target markets of Iranian cherries exports, ten indicators of market attractiveness were used, which include: 1) the target country’s share of Iran’s cherries exports, 2) the export price of Iran's cherries in the target countries, 3) inverse ranking of the target countries in Iran’s cherries exports, 4) market capacity of the target countries for cherry products, 5) economic growth of the target country, 6) per capita income in the target country, 7) consumer price index in the target country, 8) degree of openness of the economy in the target country, 9) export competitiveness of the agricultural sector in the target country, and 10) import competitiveness of the agricultural sector in the target country.
Results and Discussion: The study results showed that during the period under review, first, the export market structure of Iran’s cherry was a closed oligopoly, and then, it moved towards a dominant market by becoming more exclusive. In other words, the results of the structure analysis of the Iranian cherries export market showed that the export destinations of this product were not diverse and every year the major part of Iran’s cherry exports was limited to only a few countries. Also, the results of prioritizing the target markets for Iran’s cherry exports showed that United Arab Emirates, Afghanistan, Bahrain and Hong Kong were the main priorities for Iran’s cherry exports, and based on the silhouette width value index obtained from clustering, Iranian export destination countries were divided into four separate clusters.
Conclusion and Suggestions: Considering that the structure of Iran’s export market is not diverse and every year the majority of Iran’s cherry exports are made to only a few countries, it is recommended to use the results of the study, while paying attention to the private sector, to move the export market from focusing on the limited and traditional target markets to diversifying these markets. The prioritization of the target markets showed that the country’s cherry export was not done within the framework of a systematic and principled marketing strategy and was mainly random and influenced by political and diplomatic relations with the buyer countries. Therefore, it is suggested that by making appropriate international marketing activities, with proper planning, this product will be exported to new and emerging target markets, and on the other hand, Iran’s export share in low-priority markets (Bahrain, Iraq, Turkmenistan, and Kuwait) should be reduced.
Keywords
Cherry
Market Structure
k-Means Clustering
Numerical Taxonomy
Iran.

Subjects

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