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California stone fruit industry makes changes in quest for profitability

by Rand Green | May 25, 2009
Growers of California stone fruit, including white-flesh peaches and nectarines, have suffered hard times in recent years as production costs continue to rise and market prices have stagnated or declined.

The fallout has been significant, as several major growers, shippers and packers, some of which have been in business for generations, have downsized, restructured, sold off assets, or simply closed their doors. There is a widespread consensus in the stone fruit industry that there will be still more fallout in the weeks and months ahead.

As of this writing, there are idled packinghouses and thousands of acres of orchards in California's Central Valley being offered for sale; there are farmers looking for someone to pack their fruit; and there are experienced sales and marketing personnel looking for jobs, many of them hoping to stay in the industry.

Some companies have been in a position to benefit from the situation by judiciously picking up some of the better growers, hiring some of the good personnel who are job-hunting, or acquiring some of the available prime acreage or facilities.

Surviving companies have taken a variety of steps in an effort to restore their own operations and the industry in general to a level of profitability. The industry has long recognized the importance of consistently delivering good- tasting fruit to consumers and has conducted extensive research and implemented numerous programs over the years in the attempt to achieve that objective through such means as improved varieties and better post- harvest handling. Industry efforts to assure consistent consumer satisfaction continue to intensify.

One aspect of that effort has been the elimination of less desirable varieties in favor of preferred newer varieties.

But there is also a widespread sense that the industry has simply overproduced and that by growing less fruit, it can stimulate an improvement in market prices.

Those two forces have been at work since last fall, with the result that orchard pullouts have been considerably more extensive than usual and replacement plantings have not kept pace. The result is a net reduction in producing acreage.

Indications are that most of the bulldozed orchards represented the poorest performing varieties. That should mean less fruit overall in the marketplace and an overall improvement of the fruit that makes it to market. Growers and marketers are hopeful that will translate into stronger demand, better prices and improved profitability.

(For more on summerwhite fruit, see the May 25 issue of The Produce News.)