Assessing the Efficiency and Potential of China’s Apple Exports

Abstract

This study elucidates the factors impacting China’s apple trade, its efficiency, and opportunities for increased revenue. This study adopts a stochastic frontier gravity model on China’s apple exports data, covering the period from 1997 to 2022 across 38 significant trading partners. The finding demonstrates that the economic growth of China and its trading partners substantially boosts apple export volumes, with a positive correlation between GDP growth and export flows. The research also highlights the deterrent effect of geographical distance on exports and reveals a complex negative relationship between the per capita GDP of importing nations and export efficiency, shedding light on the nuanced nature of trade dynamics. Furthermore, the study finds that the appreciation of China’s currency plays a crucial role in enhancing export efficiency by lowering transaction costs. Meanwhile, increased agricultural land in importing countries presents competitive challenges, impacting export performance negatively. Geographical proximity and infrastructural features, such as shared borders and lack of access to seaport, are identified as significant factors in export efficiency. The analysis unveils considerable untapped export potential in various countries, suggesting a strategic avenue for market expansion. To optimize China’s apple export strategy, policymakers are advised to consider currency management, negotiate trade agreements that mitigate distance and per capita GDP effects, and target markets with high untapped potential, thereby facilitating sustainable growth in China’s apple export sector.