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September 2, 2016
CapitalPress.com
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Larger apple crops predicted for many countries Japan
Earlier harvest
gives Washington
growers an
advantage
By DAN WHEAT
Capital Press
WENATCHEE, Wash. —
Larger apple crops this fall
in the U.S., Canada, Mexico
and large crops in Europe and
China will make the new sales
season for Washington grow-
ers tougher than the one just
ending, a longtime industry
observer says.
The export market will be
tough and prices likely will
slip but should hold up better
than they did for the record
crop in 2014, said Desmond
O’Rourke, a consultant and
retired Washington State Uni-
versity agriculture economics
professor.
“The big positive so far is
that we are early so a lot of our
product is beating Michigan
and New York in the domestic
market. Gala and Honeycrisp
are shipping. That’s a huge
advantage for us,” O’Rourke
said.
Bruce Grim, manager of
the Washington Apple Grow-
ers Marketing Association
in Wenatchee, agreed, say-
ing Washington has enjoyed
a three-week jump on East
Coast producers and is open-
ing with strong prices. Main-
Dan Wheat/Capital Press
Lorena Pena holds four Summer Fuji apples with one hand as she clips their stems to prevent cuts
and bruises. She was on a crew picking apples at a C&O Nursery orchard in East Wenatchee, Wash.,
on Aug. 29. The U.S. and other countries expect larger crops this fall.
taining those prices will be a
challenge as the season pro-
gresses but it helps to have
better size and grade Gala
apples with less sunburn this
year than last, Grim said.
Marketers will keep vol-
ume moving to try to maintain
prices, he said. About 1.7 mil-
lion boxes of Gala had been
shipped through Aug. 26 of
an estimated 30.3-million-box
Washington Gala crop, up 27
percent from last season.
O’Rourke has predicted
Gala prices will average $21
per box through the new mar-
keting year, down from $24 in
the season just ending because
of greater volume in the U.S.
and other countries.
O’Rourke and Grim at-
tended the U.S. Apple As-
sociation’s 121st annual
conference at the Chicago
Ritz-Carlton on Aug. 25-26.
USDA estimates a 248
million, 42-pound box fresh
and processed apple crop for
2016. The association fore-
cast is 245.9 million boxes, up
3 percent from last year and
from the ive-year average.
While growers continue to
increase production, the crop
is well within the industry’s
capacity to effectively and
proitably market, said Mark
Seetin, the association’s direc-
tor of regulatory and industry
affairs.
Of the total, Washington
is No. 1 at 149 million boxes,
Michigan is 31 million boxes,
New York is 30 million boxes
and Pennsylvania is 11 mil-
lion boxes.
The next tier in millions
of boxes: Virginia, 4; Oregon
3.9; California, 3.5; North
Carolina, 2.5; West Virginia,
1.9; Idaho, 1.4; and Ohio, 1.2.
Michigan production is
up 49 percent. Growers there
have been replacing older
orchards with higher-density
plantings, almost doubling
their yield per acre. Michigan
could surpass New York this
year as the No. 2 producer.
That appeared to happen in
2013 but a USDA tally was in
error.
New York’s crop, ham-
pered by drought, could in-
crease this fall if growers get
rain, and there’s usually 2
million to 3 million boxes of
roadside sales not counted,
Grim said.
Nationwide, Red Deli-
cious is forecast at 53.2 mil-
lion boxes, up from 50.3
million; Gala is forecast at
44 million, up from 37.5 mil-
lion; and Honeycrisp is 15.3
million, up from 13.2 million.
Granny Smith, Fuji and Gold-
en Delicious are all close to
last season’s amounts.
Canada is up 17 percent
at 17.1 million boxes and
Mexico is up 15 percent at
31.2 million boxes. Europe
is down slightly but still huge
at 660 million. China, the
largest apple producer at 2.3
billion boxes, consumes most
of its crop internally but is
Washington’s biggest com-
petitor in Asia.
Washington’s harvest be-
gan at the end of July and
will inish in November.
Gala harvest is inishing
with good fruit size and good
maturity, said Andy Gale,
general manager of Stemilt
AgServices in Wenatchee.
There are hardly any cracks at
the stem, an indicator of over
maturity, he said.
“Generally, labor has been
a challenge. People with
H-2A (foreign guestwork-
ers) are happy but there are
a lot of ‘Help Wanted’ signs
up around the Columbia Ba-
sin and ads on Spanish radio
for pickers,” Gale said. “It’s
tighter than last year.”
Nurseries should prepare for next recession, economist says
Texas A&M
expert: Economic
indicators positive,
but downturn is
overdue
By MATEUSZ PERKOWSKI
Capital Press
PORTLAND — There’s
no reason to panic, but nurs-
ery producers should begin
preparing to weather the next
downturn in the U.S. econo-
my, according to horticulture
economist Charlie Hall.
Several indicators suggest
the economy will continue
slowly chugging along for
the time being, but based on
historical data, the country is
overdue for a recession, Hall
said at the Oregon Associ-
ation of Nurseries Farwest
Show in Portland, Ore.
“We don’t have a lot of red
lags over the next 18 to 24
months, but we will go into re-
cession at some point,” he said.
Nursery producers should
consider this current time
frame as a reprieve and de-
velop a game plan for deal-
ing with various financial
scenarios, said Hall, a pro-
fessor at Texas A&M Uni-
versity.
“We need to start right
now informing our contingen-
cy plans,” Hall said. “There’s
nothing holding us back but
ourselves.”
Sales of nursery products
and services surged for years
as the baby boomer genera-
tion married, had children and
bought houses, but they began
slowing in the 1990s and are
now lat, he said.
Because they’re in a ma-
ture industry, nurseries are
prone to disruptions — as ev-
idenced by the large number
of companies that went out of
business during the last inan-
cial crisis, Hall said.
“The interesting thing
about this stage is that any
disturbance will cause a
shakeout,” he said.
At this point, housing
starts are getting back to nor-
mal and there’s growth in the
number of mortgages, both
of which are positive for the
nursery industry, he said.
People are also quitting jobs
to take higher-paying ones,
and members of the millen-
nial generation — known for
delaying marriage and family
— are beginning to form more
households.
Lower fuel prices also pro-
vide consumers with more
spending money, though they
won’t necessarily spend all of
it on nursery goods and ser-
vices, Hall said.
Only 42 percent of con-
sumers buy plants in an aver-
age year and 25 percent spend
money on landscape services,
he said. While these numbers
aren’t great, they do imply the
industry has the potential to
increase sales frequency, he
said.
Nurseries tend to empha-
size prettiness and newness
in plants, while they should
be focusing on their function-
ality, Hall said. For example,
studying in the presence of
plants has been shown to im-
prove students’ academic per-
formance and test results.
Other research has indicat-
ed that plants and landscap-
ing increase property values,
building occupancy rates,
improve water quality and re-
duce healthcare costs.
Pet-related sales have
grown despite the recession,
which shows people are will-
ing to spend money to feel
happy, he said. Nurseries
should ind a way to tap into
this dynamic.
“We will pay whatever it
takes to improve the quality
of our lives,” Hall said.
Nurseries can appeal to
the altruism of the millenni-
al generation by promoting
the environmental beneits of
plants, such as helping butter-
lies and pollinators, said Brie
Arthur, “green industry com-
municator” who writes and
speaks about horticulture.
“I want the world to be a
better place with how I spend
my money,” she said.
resumes
U.S. wheat
tenders
By MATTHEW WEAVER
Capital Press
Japan has lifted its restric-
tions on U.S. wheat purchas-
es.
The nation’s Ministry of
Agriculture, Forestry and
Fisheries has issued tenders
for nearly 58,000 metric tons
of Western white wheat, a
blend of soft white wheat and
subclass club wheat grown in
the Paciic Northwest.
Japan has also ordered
33,000 metric tons of dark
northern spring wheat and
nearly 54,000 metric tons of
wheat from Canada.
“We’re pleased, obvious-
ly,” said Steve Mercer, vice
president of communications
of U.S. Wheat Associates.
Japan and South Korea re-
stricted U.S. wheat purchased
in July after 22 genetically en-
gineered wheat plants, deter-
mined to be Monsanto wheat
MON 71700, were found in a
fallow ield in Washington.
The countries waited un-
til a new test capable of de-
tecting MON 71700 could be
implemented. South Korea
lifted the restriction four days
later.
Mercer said all stakehold-
ers, government agencies,
customers and other involved
parties have taken a “reason-
able approach.”
“It certainly minimized the
potential for market disrup-
tion,” he said. “It was a delay
of two tenders, perhaps.”
Japan is ahead on U.S.
wheat purchases in the cur-
rent marketing year com-
pared to the same time last
year, Mercer said. The na-
tion has purchased nearly 1
million metric tons this year,
compared to 922,000 metric
tons last year. White wheat
sales are within 10 percent
of last year and spring wheat
sales are ahead.
USDA clarifying rule allows ranchers
to opt out of beef council checkoffs
By JOHN O’CONNELL
Capital Press
BILLINGS, Mont. — The
USDA is “clarifying” a lit-
tle-known policy the agency
insists has long been in place
allowing ranchers to opt out of
allocating half of their check-
off fee payments to qualifying
state beef councils, according
to a court document.
In its Aug. 4 motion in
Montana district court, USDA
argued that in light of the opt-
out policy, the judge should
dismiss a case iled by Ranch-
ers-Cattleman Action Legal
Fund, United Stockgrowers of
America challenging the con-
stitutionality of current check-
off fee management.
R-CALF alleges the gov-
ernment has forced member
cattleman to fund state beef
councils that often promote
beef in general rather than
U.S. beef or beef from their
states, in violation of their
First Amendment rights.
R-CALF has asked that
the full $1-per-head check-
off fee paid on cattle sales go
to the national Cattleman’s
Beef Promotion and Research
Board, which they agree op-
erates in compliance with the
law. R-CALF oficials said
their suit targets the Mon-
tana Beef Council as a test
case. Oficials of the Montana
council declined to comment.
USDA believes publi-
cizing the opt-out provision
eliminates R-CALF’s “com-
pelled subsidy claim.”
“To the extent plaintiff’s
members are contributing to
the Montana Beef Council
against their wishes, they are
doing so only because they
have failed to avail them-
selves of this procedure,” the
USDA motion reads.
Short of a dismissal, USDA
requested that the court at
least stay the case until after
the process of clarifying the
policy is complete. Public
comment on the proposed
clariication rule will be ac-
cepted through Sept. 13, and
USDA noted R-CALF mem-
bers are free to participate.
According to USDA’s mo-
tion, proposing a rule recog-
nizes “all producers may not
have been aware of the option
to direct their full federal as-
sessment to the Beef Board,
particularly in light of lan-
guage inadvertently removed
from the Beef Order in 1995.”
In response to USDA’s mo-
tion for a dismissal, R-CALF
attorneys iled an Aug. 24 mo-
tion asking the judge to rule in
favor of their arguments as a
matter of law, without the ne-
cessity of a trial.
R-CALF CEO Bill Bullard
noted USDA has published
a lowchart showing half of
checkoff fees must be direct-
ed back to a state beef coun-
cil. Bullard can ind no writ-
ten evidence of any opt-out
policy.
“If there was an inadver-
tent deletion (of an opt-out
policy) over two decades ago,
you would think a responsible
agency would have corrected
the mistake through a techni-
cal amendment,” Bullard said.
Bullard believes the pro-
posed opt-out rule, as USDA
recently described it, is inten-
tionally onerous to ranchers
who would seek to use it —
requiring them to ile monthly
paperwork that must be ap-
proved by state councils and
allowing the councils to hold
their revenue for up to 105
days — and that the policy
improperly places the burden
of correcting a constitutional
violation on the victims.
Bullard said a member in
Kansas wrote USDA asking
to have his full checkoff pay-
ment directed to the national
organization before the agen-
cy iled its rule, and USDA
never mentioned the existence
of an opt-out policy, instead
requesting that he seek the
state council’s permission.
Bullard said R-CALF is
educating cattlemen of their
right to opt out of the policy,
encouraging them to com-
ment on the proposed rule and
is supporting a pair of Sen-
ate bills introduced by Sen.
Mike Lee, R-Utah. S. 3200
would requires participation
in all checkoff programs to
be voluntary, and S. 3201
would prohibit the awarding
of checkoff dollars to groups
that lobby.
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