CHARACTERIZATION AND VALORIZATION OF CHILEAN FRUIT EXPORT REFUSALS FOR TECHNICAL REASONS

Abstract

Sanitary and phytosanitary measures (SPS) are within technical non-tariff measures (NTM), as they include aspects regarding quality and safety of food products. The analysis of the impact of SPS has focused on the estimation by gravity equations of their effects on import and export flows. A less explored way of addressing SPS is the study of export refusals due to non-compliance, especially regarding the economic assessment of such refusals. Therefore, the objective of this study was to characterize and value export refusals for technical reasons from the point of view of trade flows, considering the case of Chilean fruit exports to the United States market. A descriptive quantitative
methodology was applied, starting with the compilation of a database from secondary sources
(refusals records from the US Food and Drug Administration and export figures from the Office of
Agricultural Studies and Policies of Chile) and primary sources (exporters’ survey), followed by a descriptive analysis and application of a novel economic assessment equation. The results show that the value of refusals – most of them due to pesticide residue exceeding maximum limits - has a very low share in relation to the fruit exported to the USA. This could be due to the strength of the Chilean safety system, to a “reputation effect” and/or to non-direct competition with local production.