August 21, 2015
CapitalPress.com
3
Weather, low prices hamper PGG turnaround
Co-op admits
challenges, but isn’t
in danger of closing
By ERIC MORTENSON
Capital Press
Pendleton Grain Growers
in Eastern Oregon has “been
through a real challenge” in re-
cent years but is not in danger
of going out of business, the
company’s general manager
said.
Rick Jacobson, responding
to community murmurs that
bubbled up following what was
a poor wheat harvest for some
growers, said the co-op is “way
ahead of where we were last
year,” when PGG lost nearly $8
million.
The co-op sold or closed
several divisions, laid off em-
ployees, reduced excess inven-
tory, restructured its debts into a
new loan package and obtained
a $20 million line of credit in
response to the financial prob-
lems. Jacobson said in June that
PGG was positioned to make a
profit in 2015.
But a lack of moisture and
intense heat early in the season
“pinched” dryland wheat crops
for some PGG growers, result-
ing in yield reductions of 25 to
30 percent and protein levels
higher than exporters prefer.
Meanwhile, the price dropped
and Gavilon, a grain handling
company owned by the Jap-
anese firm Marubeni Corp.,
opened a truck transfer station
in Union County, giving grow-
ers another option for selling
wheat.
Jacobson acknowledged the
Eric Mortenson/Capital Press
Extreme heat and a lack of moisture at a critical time reduced
yields and quality for some dryland wheat growers in Eastern
Oregon, and hampered Pendleton Grain Growers’ economic
comeback.
combination has complicated
PGG’s comeback. He is not
sure the co-op will be profitable
this year.
“It’s not helpful to have an
off crop and it’s not helpful to
have another grain company in
our backyard, but that’s the life
and times of a business,” Jacob-
son said.
“We’re not going to fold,
that’s not going to happen,” he
said.
Jacobson said the soft white
wheat price is in the range of
$5.75 per bushel this year, com-
pared to $7 last year.
“Most businesses can’t take
those kinds of hits,” he said.
“When yields are off and the
price it low, it puts a lot of pres-
sure on the grower.”
But Jacobson, a former
NORPAC executive recruited
out of retirement in 2012 to sta-
bilize PGG, said the co-op is in
the best cash flow position it’s
been in for a long time. The
company recently signed an
agreement with McCoy Grain
Terminal to do some wheat
marketing for PGG, he said.
An industry insider who
spoke on background said
PGG and neighboring co-op
Morrow County Grain Grow-
ers face increased competi-
tion from grain handlers with
deeper pockets and that are
looking to expand their terri-
tory. In tight years, companies
that offer 10 cents more per
bushel may attract growers
even if those companies don’t
offer other services such as
fuel and fertilizer, the insider
said.
He asked not to be iden-
tified because he works with
growers and co-ops.
Pendleton Grain Growers
“didn’t attend to business as
well as they should have” in
the past but appears to have
made progress, he said.
“I don’t think they’re in
danger of going under, they’re
better off now,” he said.
Washington, California peach crops lighter
By DAN WHEAT
Capital Press
EAST WENATCHEE,
Wash. — Emma Lybarger
bought a box of nectarines
at Feil Fruit Stand near
East Wenatchee on her way
home to Lowell, Ore., after
visiting family.
“Every time, I stop here,”
she said at the fruit stand the
morning of Aug. 17.
Octavio Torres, the stand
manager, said business is
down a little this year. “The
hot weather keeps people
from stopping as much,” he
said.
Smoke coming from
wildfires to the north may
be a factor, too.
Nonetheless, the peach
crop is good, Torres said.
He was also selling nectar-
ines, plums, Italian prunes
and six varieties of fresh
crop apples and two variet-
ies of pears.
People outside Washing-
ton don’t always think of
the state as producing soft
fruit — peaches, nectarines
and plums. It does, but not
nearly the volume of Cali-
fornia.
Washington is in the
peak of harvesting 1 million
boxes of peaches with the
season likely to finish early,
about the third week of Sep-
tember instead of going into
Dan Wheat/Capital Press
Octavio Torres, manager of Feil Fruit Stand north of East Wenatchee, Wash., adjusts peaches between nectarines, plums and Italian
prunes on Aug. 17. Washington is in the thick of its peach harvest, which is a fraction of the size of California’s peach crop.
October, said B.J. Thurlby,
president of the Washington
State Fruit Commission in
Yakima.
California’s crop is
closer to 40 million boxes,
down from 60 million sev-
eral years ago, he said.
Growers replant older or-
chards with newer varieties
for more color and size but
many also end up planting
nuts or other crops, he said.
Washington also has
about a 1-million-box nec-
tarine crop, but box weight
varies from 12 to 27 pounds,
Thurlby said.
In terms of tons, Wash-
ington will have about
8,500 tons of fresh-packed
nectarines and 8,500 tons of
peaches, down from a more
normal 9,000 tons, he said.
In utilized tonnage (fresh
and processed), California
had 616,000 tons in peaches
in 2014, followed by South
Carolina at 60,800 tons and
Georgia at 33,000 tons, ac-
cording to the USDA Na-
tional Agricultural Statis-
tics Service. Washington,
at 14,400 tons, trailed New
Jersey and Pennsylvania.
California’s peach crop
for 2015 is forecast by
NASS at 566,000 tons,
down 8 percent due to vari-
able fruit set and drought.
In Corning, Calif., Rob-
ert Mills, co-owner of R and
K Orchards, said his peach
season is wrapping up about
three weeks earlier than
normal.
“That’s a good thing,” he
said, “because the kids are
going back to school and
I’m losing all my help.”
Although the season
started and ended early, it
produced a lot of high-qual-
ity fruit, he said.
Washington
packed
4,800 tons of apricots this
year from late May to the
third week of July. A few
more finished the first week
of August, Thurlby said.
That was down from last
year’s record 7,385-ton crop
and was about one-fourth the
size of California’s crop, he
said.
Washington also produced
about 1,000 tons each of
plums and Italian prunes this
year. The crops were lighter
because of poor pollination,
he said.
Capital Press staff writer
Tim Hearden contributed to
this report.
Oregon cranberry harvest gets an early start
By ERIC MORTENSON
Capital Press
At this rate, the Thanks-
giving turkey will show up on
Halloween.
At least one cranberry
grower on the Southern Or-
egon coast began harvest
this week, up to two or three
weeks earlier than normal.
Grower Charlie Ruddell of
Randolph Cranberries Inc.
believes his harvest will mark
the earliest date commercial
cranberries have ever left the
Bandon receiving station,
which he said wasn’t sched-
uled to open until Sept. 21.
A spokeswoman for Ocean
Spray, the cooperative of which
Ruddell is a grower-member,
said his harvest is the first in
North America for 2015.
Spokeswoman Kellyanne
Dignan said Ocean Spray has
no issue with opening the re-
ceiving station so early. “If
the berries are ready to come
in, as a co-op we are open to
receiving them,” she said.
Cranberries are judged
ready for harvest based on
color, size, firmness and sug-
ar content, which is expressed
in the term “brix.” The timing
of reaching that stage varies,
Dignan said. “Mother Nature
makes that decision.”
Ruddell attributes the ear-
ly harvest start to three things:
The new variety he planted,
Demoranville, which was
developed by Rutgers Uni-
versity, is earlier than other
varieties. Second, the plants
are two and three seasons old,
and young plants tend to bear
fruit sooner than more ma-
ture cranberries. Finally, like
many other crops in the Pacif-
ic Northwest, warm weather
has pushed harvest up by a
couple weeks.
Unlike many other parts
of the Northwest, Bandon
has adequate water this sum-
mer, Ruddell said. At harvest
time, growers typically flood
cranberry bogs with about 18
inches of water and churn the
water to loosen the berries.
The berries float to the sur-
face, where growers gather
them up.
After cleaning at Ocean
Spray’s Bandon receiving sta-
tion, the cranberries will be
trucked to a company process-
ing plant in Markham, Wash.
Dignan, the co-op spokes-
woman, said they’ll either
be processed into “craisins,”
which are dried, sweetened
cranberries, or used to make
cranberry juice or sauce.
The USDA has project-
ed strong cranberry harvests
for Oregon and Washington.
Oregon growers may top the
Courtesy of Randolph Cranberries Inc.
A cranberry bog along the Southern Oregon coast fills with water as harvest nears. Cranberries are a $12 million annual crop in Oregon.
500,000 barrels they produced
in 2014. Washington growers
may produce 186,000 barrels,
the most in a decade. A barrel
equals 100 pounds of cranber-
ries.
Prices vary, but Oregon’s
cranberry production is
ranked 38th in value among
the state’s crops and was
worth about $12 million in
2013.
SAGE Fact #115
At Tidewater Terminal in Boardman,
cranes annually move more than 21,000
containers between barges and trucks.
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