July 1, 2016
CapitalPress.com
3
Any impact of ‘Brexit’ vote on ag likely to be temporary, experts say
By MATEUSZ PERKOWSKI
Capital Press
With British voters de-
ciding to leave the European
Union, U.S. agriculture may
experience a dent in commodi-
ty crop prices, experts say.
Exactly how much impact
a “Brexit” will have had on
U.S. crop values is debatable,
however.
Any major unprecedented
event in global inancial mar-
kets can lead to volatility, said
Lindsey Piegza, chief econo-
mist for the Stifel brokerage
and investment irm.
“The unsettling effect
would extend to the agricul-
tural commodities market as
well,” Piegza said.
If the Britain pulling out
of the European Union leads
to an economic slowdown
or recession, businesses and
consumers would “tighten
their purse strings,” reducing
spending and thereby leading
to lower prices, she said.
While the potential impact
of the “Brexit” may be over-
blown, the uncertainty of that
outcome could be destabiliz-
ing, Piegza said. “It could be a
self-fulilling prophecy.”
If the value of the euro cur-
rency drops due to a “Brexit,”
the correspondingly higher
value of the dollar could hurt
exports of U.S. farm goods,
said Rich Nelson, chief strat-
egist for the Allendale com-
modities brokerage irm.
Even so, the decrease
would likely be temporary
and wouldn’t cause “death and
devastation,” Nelson said.
Britain didn’t gain as much
economically as expected
from its EU membership, so
a withdrawal probably won’t
have cataclysmic impacts, he
said.
Michael Swanson, agri-
cultural economist for Wells
Fargo Bank, said he’s “highly
skeptical of stories of unmiti-
gated shocks” from Britain’s
EU withdrawal.
There’s usually a “feedback
loop” that stabilizes markets,
Swanson said.
If the British pound drops
in value due to the “Brexit,”
for example, that would in-
crease demand for the coun-
try’s goods and services over-
seas, eventually helping its
currency to recover, he said.
“According to the experts,
the world ends every day, but
luckily it seems to start up
again the following morning,”
he said in an email.
AP Photo/Tim Ireland
The front page of the Sun newspaper tells the story of Britain’s vote to leave the European Union.
Fewer Northwest farmers gamble on ickle, volatile ginseng
By MATEUSZ PERKOWSKI
Capital Press
Courtesy of U.S. Fish and Wildlife
Fewer Northwest farmers are growing ginseng, pictured in this
photo, because of the crop’s ickleness and price volatility. The
crop once provided a proitable niche in the region during its
heyday in the 1990s.
down from about 130 during
the crop’s heyday in the 1990s.
There are currently no gin-
seng farmers licensed by the
Oregon Department of Agri-
culture, down from 12 growers
in 2000. Licensing is required
because the endangered plant is
regulated under an international
treaty.
Five ginseng growers are
registered by the Washington
State Department of Agricul-
ture, but none have yet received
a certiicate allowing them to
sell the crop. Between 2004
and 2013, the state had no reg-
istered ginseng farmers.
Ginseng thrives naturally
in the deciduous forests of the
Midwest and East Coast, where
the wild roots have been known
to fetch exorbitant prices, but
it doesn’t grow under the thick
overstory of the Northwest’s
conifers, said Brun.
To produce ginseng here,
per pound, below the cost of
production of about $12 per
pound, Sego said.
The crop’s lack of proit-
ability forced many growers
to abandon it, but they’ve re-
mained wary of returning to the
market even after prices picked
up in the mid-2000s, he said.
In the past decade, cultivat-
ed ginseng prices have reached
as high as $100 per pound, but
the possibility of another price
plunge has dampened enthusi-
asm for a crop that requires four
years to harvest, Sego said.
Though ginseng seeds can
provide a source of cash after
two years, the costs of weeding
the crop have nonetheless dis-
couraged farmers, particularly
as labor has become more ex-
pensive, he said.
Meanwhile, the prospect of
“sudden death” from root rot
or leaf blight is as real as ever,
Sego said. “It can devastate
people.”
A contract with a buyer
convinced Sego to again plant
ginseng, which he is growing
organically along with his sta-
ple herb crops of goldenseal
and ginkgo.
In light of the strife caused
by ginseng in recent decades,
however, he’s not expecting
many new local competitors.
“I doubt there will be a re-
vival,” Sego said.
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PNW cherry harvest moving well
By DAN WHEAT
Capital Press
YAKIMA, Wash. — The
Paciic Northwest cherry har-
vest is more than half done
with 10.7 million, 20-pound
boxes of cherries picked,
packed and shipped from May
18 through June 26.
The industry eclipsed
500,000 boxes per day on
June 24 — “a sure sign that
we are in the peak stretch of
the dark, sweet crop with sus-
tained heavy volume forecast
for several weeks,” said B.J.
Thurlby, president of North-
west Cherry Growers in Ya-
kima.
The crop still looks to be
about 17 million boxes fol-
lowing an estimated 1.5 mil-
lion-box loss from a heavy
June 18 rain, said Tom Rig-
gan, general manager of Chel-
an Fresh Marketing in Chelan.
Export volume totals 3
million boxes with Canada,
China, Hong Kong and Tai-
wan leading the way, Thurlby
said. The 17 million boxes
include 1.5 million, 15-pound
boxes of the Rainier variety,
he said.
Packouts are now starting
to improve after falling from
the mid-90-percent range
to the low 80s after the rain,
Riggan said. Some growers
left damaged cherries un-
picked and northern Okan-
ogan County had more rain
and damage than areas to the
south, he said.
“Quality is phenomenal.
We’re getting a lot of feed-
back from retailers and con-
sumers that it’s great,” Riggan
said.
Based on the latest orders,
supply is maybe slightly less
than demand which is “sort
of a perfect scenario,” Riggan
said. It keeps prices stable and
competitive retail ad prices of
$1.99 to $2.99 per pound will
keep volume moving the next
two weeks, he said.
Picking and packing labor
Dan Wheat/Capital Press
Lucas Perez picks Bing cher-
ries in Limon Orchard south of
Wenatchee, Wash., on June
16. The harvest is past midway
and packouts are improving
again after a June 18 rain.
is inally adequate after being
very tight early on, Riggan
said. He attributes the relief to
workers moving up from Cal-
ifornia and school letting out.
Chelan Fruit Co-op slows
down apple packing to help
out with cherries, he said,
adding that probably most
packing houses do that.
The latest forecasts from
USDA’s National Agricul-
tural Statistics Service and
the Michigan Frozen Food
Packers Association show,
as usual, Washington leading
the nation in sweet cherries
and Michigan leading in tart
cherries.
The Michigan association
estimated Michigan’s 2016
tart cherry crop at 262 mil-
lion pounds, Utah at 50 mil-
lion, Washington at 27 mil-
lion, New York at 7 million,
Oregon at 3 million and the
national total at 351 million
pounds.
The association estimated
Michigan’s sweet cherry crop
at 54 million pounds with
52.5 million of that brined,
frozen and canned with 1.5
million sold fresh.
NASS estimates national
sweet cherry production of
318,000 tons, down 6 percent
from 2015. The breakdown:
Washington, 195,000 tons;
California, 60,000; Oregon,
42,000; Michigan, 21,000.
27-1/#6
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Herb farmer Roger Sego
will soon ind out whether a
4-year-old bet will pay off.
In 2012, Sego planted gin-
seng on his property in La Cen-
ter, Wash., that he expects to
harvest this autumn.
Cultivating the medicinal
roots for the Asian market is
“a real crapshoot,” as the ick-
le crop is prone to diseases that
can almost instantaneously
obliterate yields, he said.
Meanwhile, shade cloth and
other supplies require a hefty
upfront investment that’s inher-
ently risky due to steep price
luctuations.
“There’s not a lot of people
who will gamble to do that,”
Sego said.
Farming always involves a
degree of speculation, but the
hazards of producing ginseng
have scared off most Northwest
growers of the crop, which once
provided a proitable niche in
the region, experts say.
“It was all fun but then it
all came crashing down,” said
Charles Brun, a retired Wash-
ington State University Exten-
sion specialist who studied the
crop.
Sego estimates there are
currently fewer than 15 gin-
seng growers in the Northwest,
farmers must buy shade cloth
as well as posts and cables to
support it over the crop canopy
at a cost of roughly $25,000 an
acre, he said.
The rich clay soils found in
many areas of the Northwest
are also conducive to root rot in
ginseng, and no effective fun-
gicide has ever been identiied
and registered, Brun said.
High prices during the early
1990s nonetheless justiied the
trouble and expense of growing
ginseng, he said. “For a while
there, it did make sense.”
As often happens in agricul-
ture, though, high prices even-
tually led to a glut.
Overproduction of ginseng,
particularly in Canada, drove
down prices from more than
$40 per pound to less than $8