The Determinants of Grape Storage: Evidence from Grape Growers in China

Abstract

Storage of high-value agricultural products is essential to increase their added value. Exploring growers’ storage strategies for high-value agricultural products is helpful in developing the agricultural industry. In this paper, we analyzed the factors affecting growers’ storage decisions using Probit and Tobit models based on field data from 1026 grape growers in China. We conclude that the in-season price has a negative effect on growers’ storage decisions. Expected price, market risk perception and grape quality have a positive effect on storage decisions. Borrowing behavior has a positive effect on the storage decisions of large-scale growers. In addition, the higher the expected price and the greater the market risk perception, the more growers prefer long-term storage; and the better the quality of the grapes, the more growers tend to store grapes in the short term.