The production area in Japan that the Onsen-Seika Agricultural Cooperative (Onsen-Seika) oversaw changed in 1970s, from producing mandarin oranges—known as satsuma or unsyu—to Citrus iyo; this change was in reaction to an oversupply of mandarin oranges. While the region prospered and became the largest Citrus iyo-producing area, it gradually fell from this position among the citrus-growing areas. This study explores the development of Onsen-Seika and the production area it oversaw in the 1970s and 1980s.
Existing research into Onsen-Seika and the region it has overseen has focused on internal conditions and production activities, but they do not shed enough light on the market environment surrounding the region. This study focuses on the relationship between the development of the region and its environment—in particular, (a) other competing Citrus and fruits, and (b) movements in the markets and other producing regions.
Historical analysis of this case clarifies, first, that Citrus iyo had dropped in price over time as other regions increased Citrus iyo production in the 1970s and 1980s—although it did have a price advantage over other competing Citrus, until the mid-1980s. As the volume of competing Citrus and fruits grew and became more ample, the Citrus iyo market started to flag. Second, while Onsen-Seika and the production region it oversaw experienced rapid growth in the early Citrus iyo market, the region’s various problems (e.g., quality and yielding ability) became apparent within the context of the increased market entry of other producing regions and changes in the supply-demand relationship. From a long-term perspective, since 1984, Onsen-Seika has focused on resolving production problems; however, in the meantime, the growth of other producing regions advanced into the Citrus iyo market in the late 1980s. In summary, Onsen-Seika and the production region it oversaw faced two impasses—that is to say, those concerning the internal and external Citrus iyo markets.
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