Year: 2026
Type: article
Abstract: Export-oriented perennial horticultural industries are increasingly exposed to macroeconomic shocks, yet there is limited empirical evidence on how exchange rates, financing conditions, production costs, and climatic variability jointly influence long-run production adjustment in emerging economies. This knowledge gap constrains evidence-based policies aimed at strengthening export competitiveness and investment in high-value horticulture. This study examines the macroeconomic determinants of avocado production in South Africa, a capital-intensive export industry closely integrated into global markets. Annual data for 1991–2024 are analyzed using an autoregressive distributed lag (ARDL) error-correction framework to estimate long-run relationships and short-run adjustment dynamics between avocado production and key macroeconomic variables. The results indicate a stable long-run equilibrium in which exchange-rate movements are the dominant driver of production, highlighting the importance of external competitiveness in export horticulture. In the short run, production adjusts primarily through changes in fertilizer price pressures and financing conditions, while rainfall variability and consumer inflation exert limited influence, reflecting widespread irrigation and weak dependence on domestic demand. The estimated error-correction mechanism indicates relatively rapid adjustment following macroeconomic shocks. These findings suggest that production in export-oriented perennial horticulture responds more strongly to trade competitiveness and production costs than to climatic variability or domestic price conditions. The findings underscore the importance of exchange-rate stability, efficient input markets, and access to specialized agricultural finance in sustaining the competitiveness of high-value horticultural exports in emerging economies. The results should be interpreted in light of the use of aggregate annual industry-level data, which do not capture regional or farm-level heterogeneity. Future research should employ farm-level or regional panel data to examine heterogeneous production responses and the role of technological and institutional factors in shaping long-run industry performance.
Institution: North-West University
Language: English
Subfield: Safety Research
Field: Social Sciences
Domain: Social Sciences
Open Access status: gold
Estimated APC paid: $2,353
OpenAlex ID: W7212447128