June 2, 2017
CapitalPress.com
9
China needs apple diversity, marketer says
Wenatchee exporter
ends up in Shanghai
By DAN WHEAT
Capital Press
WENATCHEE,
Wash.
— Over dependence on one
variety “is a ticking time
bomb” for the Chinese apple
industry, says the internation-
al business CEO of a Chinese
fruit company.
Seventy percent of Chi-
na’s apple production is Fuji
and if China doesn’t reinvent
itself with new varieties it
will suffer the same downturn
Washington growers faced in
the late 1990s and early 2000s
when they were too dependent
on Red Delicious, Tracy King,
International Business CEO of
Xing Ye Yuan Group in Shang-
hai, told Capital Press.
“There is global demand
for Fuji but clearly the trend
is toward many new varieties
at the consumer level, even
among Chinese consumers. If
Chinese growers do not get out
ahead of demand, there will be
a day of reckoning,” King said.
Southeast Asia, India, In-
donesia, Canada and Mexico
are better markets for Chinese
apples than the
U.S., but it’s
tough to only
have one vari-
ety to sell, said
King, who more
than a decade
Tracy King ago was export
director of the
Washington Apple Commis-
sion in Wenatchee.
Mexicans love the sweet
taste of Fuji and there is a rela-
tively large Chinese-Canadian
demographic, he said.
Chinese apple exports to
the U.S. are small at 192,258,
40-pound boxes in 2015-2016
but that was up 30 fold from
the year before, according to
USDA. Even if that doubles
this year it’s statistically irrele-
vant, King said. Chinese apple
farmers are among the least
efficient in the world and the
U.S. will not be “flooded with
cheap Chinese apples in my
lifetime,” he said.
Washington apple sales
to China, roughly 1.3 million
boxes during each of the past
two years, have a much bright-
er future because Washing-
ton growers are efficient and
producing newer varieties, he
said.
Xing Ye Yuan began more
than 20 years ago as an ap-
ple and citrus fruit packer. It
expanded to become one of
China’s largest distributors of
domestic fruits and vegetables.
King was hired in January to
start an import-export program
for apples, oranges and other
fruits.
He is setting up imports of
Washington apples, pears and
cherries and California table
grapes, citrus, stone fruit and
Chilean product, which will
run counter seasonally.
“This is a great fit for my
skill set as I have been export-
ing these items from the U.S.
to China since the mid-1990s,”
he said.
It is easier for him to
call shipper-marketers in
Wenatchee, Chelan and Yaki-
ma to buy fruit than someone
from China without his con-
nections and experience, he
said.
But the U.S. is way down
on his list for exports because
the market for Fuji is “only so
large” and Americans “have
become very picky about what
varieties they like,” King said.
Chinese Fuji growers also
have a huge ocean freight dis-
advantage to U.S. Fuji grow-
ers, making return to Chinese
growers as much as $5 per box
less in the U.S. market com-
pared to U.S. growers, he said.
King, 59, was born and
raised in the Seattle area and
received his bachelor’s de-
gree in international studies
at the American University in
Washington, D.C. He received
his master’s degree in Chi-
na Regional Studies from the
University of Washington in
Seattle. His interest in China
was spawned by normalization
of U.S.-China relations in the
1970s. He is fluent in Manda-
rin Chinese and lived in Bei-
jing in 1980-81 researching his
thesis on Chinese agriculture.
King was an export fruit
salesman at Oneonta Starr
Ranch Growers in Wenatchee
from 1990 to 2002, export di-
rector at the Washington Ap-
ple Commission from 2002 to
2005 and director of market-
ing at Dovex Marketing Co.
in Wenatchee in 2005-2008.
Next he was Asia region-
al sales manager for Sin-
clair Systems International,
Wenatchee, a manufacturer of
produce PLU — price look-
up — stickers, in 2008-2012
and then China sales manag-
er for Anderson Hay & Grain
Co., Ellensburg, in 2014-16.
Mateusz Perkowski/Capital Press File
A drone is demonstrated at the Oregon State University agricultural
research station near Pendleton, Ore. The federal government has
clarified flight safety rules for commercial drone operations but the
privacy policy remains murky.
Drone privacy
questions defy easy
Severe winter strengthens East Idaho hay prices answers, attorney says
Unmanned aerial vehicles offer
opportunities, concerns for agriculture
Capital Press
IDAHO FALLS — East-
ern Idaho hay farmers say
they may again have a chance
to raise a profitable crop.
A glut of hay depressed
the forage market during the
past couple of years, though
slumping prices of compet-
ing crops left growers without
better options.
However, growers and
feeders say the extreme win-
ter has depleted hay invento-
ries, resulting in strengthen-
ing alfalfa prices.
“It looks like the old crop
hay is pretty well cleaned up,”
said Lewisville feedlot oper-
ator Duwayne Skaar. “We’re
thinking this (new crop of
feeder) hay will start out over
$100 per ton.”
Bone-area rancher Rick
Passey ran out of hay sever-
al weeks ago and has been
buying additional bales from
a neighbor. Passey plans to
make his first cutting of new
alfalfa June 15-20.
“We started out at $80
per ton, and we told them we
needed 100 tons more, and
they raised it to $100,” Passey
said. “The carryover that’s
been here for the past couple
of years, I think it’s going to
By MATEUSZ PERKOWSKI
Capital Press
Courtesy of Rick Passey
Allan Empey, left, props up a fence post for Rick Passey to drive into the ground with a post pounder
on the front of his tractor. Passey is preparing to graze cattle on his rangeland following a harsh winter
that depleted alfalfa supplies.
be greatly dwindled.”
As of May 1, USDA report-
ed Idaho on-farm hay stocks
at 510,000 tons — down 46
percent from the previous
year. But good rangeland con-
ditions should provide some
relief to ranchers. According
to a USDA report for the week
ending May 14, 83 percent of
the state’s pastures and range
were reported to be in good to
excellent condition.
Passey said unseasonably
warm weather during the first
two weeks of May melted
snow and stimulated grass
growth throughout the foot-
hills where his cattle graze,
though he’s had to repair
miles of fencing damaged by
heavy snowdrifts.
University of Idaho Ex-
tension economist Ben Eborn
recently calculated the cost of
producing a ton of alfalfa in
Eastern Idaho at $87. Earlier
this winter, he said feeder hay
was selling for $60 to $75 per
ton.
“That price is probably
up $25 per ton,” Eborn said,
adding the new alfalfa crop
sustained less winter dam-
age than many feared, and
hay export demand is also
improving. “We got the hard
winter, and it cleaned the hay
out, dropping the oversupply
in half.”
With grain prices still low,
Dubois alfalfa grower Chad
Larsen anticipates feeders will
feed less hay and more corn
and barley. Larsen said feeder
hay is selling for about $110
per ton delivered, and dairy
hay is selling for about $150.
“We get calls every week
on feeder hay or dairy hay,
and we’re out,” Larsen said.
McCammon rancher Jim
Guthrie said many feed-
ers have resorted to buying
poor-quality hay, some of
which has been sitting for two
years.
Apple Commission
adopts new budget
Multi-state dry bean consortium
one step away from reality
By DAN WHEAT
Capital Press
By SEAN ELLIS
Capital Press
YAKIMA, Wash. — The
Washington Apple Commis-
sion trimmed some promo-
tional dollars targeted for sev-
eral countries in adopting its
$10.4 million budget for fiscal
year 2017-18.
Other than that and $51,000
to re-roof the commission
building in Wenatchee, the
budget was little changed
from the current $10.4 million
budget year ending June 30.
The budget, passed by the
commission May 25, includes
$7.8 million for export pro-
motions with $4.8 million
from the federal Market Ac-
cess Program and $3 million
from a 3.5-cent a box assess-
ment on the 2017 crop, esti-
mated at 135 million boxes.
A total of $282,000 was
shaved off promotions in
Central America, Thailand,
Malaysia, Taiwan, Western
Europe and Russia because of
a reduction of that amount in
MAP money, said Todd Fry-
hover, commission president.
The budget allocates $1.1
million for promotions of
Washington apples in Mex-
ico, $1.1 million for India,
$875,000 in China, $600,000
in Vietnam and $550,000 in
Indonesia. Those amounts are
similar to what was spent on
the season now ending.
The commission will also
spend $520,000 on Central
America, $510,000 on Thai-
land, $307,000 on Malay-
Courtesy Washington Apple Commission
The new logo the Washington
Apple Commission is consider-
ing for overseas point-of-sale
promotions.
sia, $295,000 on the Middle
East, $275,000 on Taiwan,
$260,000 on South America,
$50,000 on Western Europe
and $26,000 on Canada.
About $500,000 will be
taken for the top five coun-
tries from $2.6 million in re-
serves, Fryhover said.
The commission plans to
spend $500,000 per year for
the next three years for a total
of $1.5 million out of the $2.6
million to offset expected
MAP reductions, he said.
The commission also has
$3 million in reserves for cat-
astrophic events such as the
Alar scare of 1989, he said.
Representatives
from
Mexico, India, China, Viet-
nam and Indonesia will be in
Wenatchee June 8-9 to dis-
cuss promotions and how to
use a new logo featuring the
Washington apple logo sur-
rounded by individual logos
of about two dozen compa-
nies in point-of-sale materials
in overseas markets.
BOISE — An effort to cre-
ate a multi-state dry bean re-
search consortium has moved
along slowly since it was first
pitched in 2013 but it’s now
one step away from being for-
malized.
Dry bean commissions,
processors and land grand
universities in Colorado,
Idaho and Wyoming agreed
in 2013 to form a consor-
tium that works together on
projects that benefit all three
states’ bean industries.
“I think we’re making
progress but it’s slow,” said
Jerry Haynes, secretary of the
Colorado Dry Bean Adminis-
trative Committee.
The Idaho Bean Commis-
sion has led the effort.
The University of Wyo-
ming and Colorado State Uni-
versity signed memorandums
of understanding several
months ago that spell out how
the states’ universities will co-
operate.
Once University of Idaho
signs the MOU, the effort is
a go. UI officials did not say
when that might happen.
“That agreement would
formalize everything and then
we could develop the mech-
anisms needed to start get-
ting things going,” said Mike
Moore, manager of UW’s
Seed Certification Service.
The idea it to maximize
the amount of money avail-
able for bean research by not
duplicating efforts and work-
ing together on projects that
benefit each state, said Idaho
farmer and IBC board mem-
ber Bill Bitzenburg.
“There are a lot of issues
in the bean industry that ar-
en’t state-specific,” he said.
“A bean is a bean.”
Haynes said bean-related
issues the states could work
together on include breeding,
fertility, variety testing, water
management and herbicide
testing.
Not duplicating efforts
will be one of the biggest
benefits of the effort, people
involved in it told Capital
Press.
“We would really like for
this to move forward because
we all have the same goal in
mind — not to duplicate ef-
forts and to develop more of
a multi-state (approach),”
said IBC Administrator Andi
Woolf-Weibye.
Colorado’s bean industry
has pledged $10,000 a year for
three years toward the effort,
Idaho is expected to provide
$30,000 a year for three years
and Wyoming, which recently
created a bean commission,
will contribute as well.
Moore said that for land-
grant universities, which nor-
mally compete for research
funding, to work together
at this level will be ground-
breaking.
Others said they are hope-
ful the consortium will be
that significant but are a little
skeptical that it actually will
because of how slowly it’s
moved.
SALEM — Federal au-
thorities are making headway
in regulating commercial
drone operations but some
questions defy easy answers,
according to an attorney spe-
cializing in the technology.
While rules developed by
the Federal Aviation Adminis-
tration for unmanned aircraft
vehicles are becoming clearer
and more streamlined, many
issues remain legally murky,
said Craig Russillo, an attor-
ney with the Schwabe, Wil-
liamson and Wyatt law firm.
One particular area of un-
certainty is the tension be-
tween the federal government
and landowners over who
controls airspace, Russillo
said during an April 25 agri-
cultural seminar organized by
his firm.
“It’s shifting sands. It’s
moving around a lot,” he said.
Historically, this matter
of jurisdiction was often less
contentious because airplanes
and helicopters generally
didn’t fly at low altitudes over
people’s homes and property,
Russillo said.
Now, however, there’s
a possibility of cam-
era-equipped drones flying 10
feet above someone’s back-
yard, raising privacy con-
cerns, he said.
Federal regulators have
largely concentrated on flight
safety and have “punted” on
privacy policy, Russillo said.
“You have states and munic-
ipalities filling the void here.”
The concern is that without
a national approach, the U.S.
will develop a patchwork of
different rules across different
jurisdictions that complicate
commercial drones opera-
tions, he said.
In agriculture, drones of-
fer the possibility of aerially
monitoring crop health, irri-
gation efficacy and field oper-
ations without hiring profes-
sional pilots.
“The drone is really just
a platform for gathering
data,” Russillo said.
On the other hand, un-
manned aerial vehicles could
be used for unwanted surveil-
lance of livestock operations
by outside groups, for exam-
ple.
In Oregon, lawmakers
have passed a statute under
which landowners can sue for
injunctive relief, damages and
attorney fees if a drone opera-
tor persists in flying less than
400 feet over their property
after a warning.
Landowners can also re-
port the problem to the FAA,
though it’s unclear how in-
volved the agency would be-
come in such disputes, Russil-
lo said.
Over time, it’s likely that
case law will establish the
rights of landowners to “dis-
able” drones flying over their
property, but those lines have
yet to be drawn, he said.
“You don’t have a right to
shoot it down,” Russillo said.
Farmers who use drones
could be held liable for tres-
pass, injury or property dam-
age as well, but such incidents
aren’t covered by their gener-
al liability insurance, he said.
Existing insurers may offer
separate coverage for drones,
but growers can also turn to
specialized companies, such
as Verifly, which offer on-de-
mand liability insurance of
up to $25,000 for a per-hour
price of $10, Russillo said.
When flying unmanned
aerial vehicles to enhance
their farm operations, growers
must familiarize themselves
with the federal rules for
drone usage, he said.
For example, commercial
operators must obtain a re-
mote pilot certificate, operate
drones weighing less than 55
pounds and always keep the
devices within their visual
line of sight, among other reg-
ulations.
“If something goes wrong,
whether you are or aren’t in
compliance with federal law
could be very important,”
Russillo said.
ROP-40-42-4/#17
By JOHN O’CONNELL