Vidalia growers face labor shortage

"Hurricane Katrina has really thrown our growers a curve ball this year," said Wendy Brannen, executive director of the Vidalia Onion Committee in Vidalia, GA. "Labor has gone south to help the Katrina relief effort, which left us short of labor for planting this year."

On Jan. 30, she said, "Some of Vidalia's major growers have expressed concerns throughout the planting season that there was a labor crunch."

Grower Bo Herndon of L.G. Herndon Jr. Farms Inc. in Lyons, GA, who also sits on the board of the Vidalia Onion Committee, said that Vidalia onion planting starts around Nov. 10, and "we try to be through by the end of December, but you can plant November 1 and run to the end of January and be safe."

Mr. Herndon said Jan. 30 that the whole Vidalia crop for 2006 had been planted. Some Vidalia growers did not plant an entire crop of onions because of insufficient labor. Thus, "I think the crop will be short, but a lot people will not have enough labor" for harvest this spring.

Ms. Brannen said that the Vidalia Onion Committee is working legislatively at both the state and national levels as immigration and labor issues are increasingly pressing. Mr. Herndon said, "I have been in the H2A program for six or seven years. If you're in the H2A program, it's the only way to be legal, and it costs a ton to be legal. If you're not legal, you don't get enough labor." Mr. Herndon said he has to pay $8.07 per hour minimum wage to his H2A workers, while those who have other workers are paying as little as $6.50 per hour.

"Seventy-five percent of the migrant workers in the U.S. are illegal. There are another 25 percent that are legal workers." These include people from one-time migrant families that were born in the United States. The national labor laws and related legal structure "has penalized the employers that have been legal."

Mr. Herndon said that the supply of agricultural workers "will get worse when they close the borders down and keep the illegals from coming in."

Sitting on the Vidalia Onion Committee board with Mr. Herndon is Alan Sikes of Sikes Farms in Collins, GA. Mr. Sikes said Jan. 31 that it is hard to keep immigrant farm workers in the United States because "as soon as they learn the [US] system," they move away from farms to easier jobs in the retail and foodservice sectors. Mr. Sikes considers himself fortunate because "I've had the same crew for years and years. We have greater than an 80 percent return on my core crew. That is very good, but I saw that all my neighbors had tremendous labor shortages. I have surplus; I have core crew and a big group of extras" because "I have a very, very honest crew leader."

This planting season, however, Mr. Sikes said, "I had my normal crew but not all the extras we normally get. Looking around at my neighbors, I could see that we're becoming more and more vulnerable to this labor situation. We have to be more mechanized or have a guest worker program. We have been growing onions in our family since the '70s, and times are changing. We have to address the issue." Because of his good labor situation, he said that he could maintain his status quo "for as long as any grower, but I have to change too. I don't have a horror story to tell like a lot of them. A lot had a knot in their stomach wondering how they were going to plant and harvest."

Sikes Farms, an operation involving "the whole" Sikes family, will have its "normal 250 to 300 acres of Vidalia onions this spring." Other growers did not necessarily meet their planting expectations because of a labor shortage, which he said will haunt Vidalia again when harvest time comes in April. As an industry, "We have a tough time getting [the onions] harvested when there is not a labor shortage." Weather and other factors present challenges beyond labor in the spring. "I can see a big problem with harvest. We have dodged several bullets in the past" at harvest, "but not always."

Mr. Sikes said, "We need legislative action" to improve the national immigrant labor situation. "I tried to participate in the [H2A] guest worker program about seven years ago before I had this crew I have now. I had a Guatemalan crew before. We were bombarded with lawsuits from Legal Aid and other entities. I had to give up that idea" of the H2A program.

Mr. Herndon confirmed that "the greatest expense for those growers cooperating with the H2A program have been consistent lawsuits" against growers.

Mr. Herndon and Mr. Sikes both noted that a grower has never lost one of these lawsuits, but growers have spent millions of dollars defending themselves in court. Mr. Herndon said that he has won lawsuits filed against him by workers whose claims were ultimately proven false. "It cost me a lot to prove I was right, but you've got to defend yourself."

Because Legal Services is supported by taxpayer dollars, "I pay Legal Services to sue me, and then I pay to defend myself. That is not right. It tells you the system is not working." He noted several reforms are in the works to improve the migrant labor situation. "Hopefully in a few years," this will be straightened out, Mr. Herndon said. Mr. Herndon said that his costs for legal workers have included building houses to specified conditions.

Mr. Sikes observed, "If we closed the border today we would have such a negative shock on our economy that it would be a poor decision to do so. Long term, closing the border is viable for the long term strength of this economy because of the cost of the infrastructure needed for enforcement." Mr. Sikes said that if businesses could have years to plan labor law changes, "it would give us a chance to prepare for that time. If I knew that -- in no uncertain terms -- that I would no longer have workers on January 1, 2008, I would have time to go procure a machine. You can harvest with a machine but if I have machine harvesting and my neighbors harvest by hand, day in and day out, theirs will be slightly nicer. Currently, we're unable to harvest with a machine as delicately as can be done by hand but it's quite acceptable. If we both have a machine, we will get our onions to the end consumer cheaper in long run," Mr. Sikes said.

A crew would still be needed for the packinghouses, but such crews tend to number 30 vs. the 80 needed for planting. And accelerated pay scales in the packinghouses could attract people for that work.

"We have answers here but we don't need abrupt change." Mr. Sikes emphasized that he must be absolutely sure of when and what changes will apply to the entire industry to keep a fair level of competition and allow for efficient business planning. I have to believe we won't have workers in '08. If I do invest and my neighbors don't, then they can still do a slightly better job picking."

Another Vidalia grower, James McClain of McClain Farms, said, "Our politicians need to do something for us that is better for us to work with. They don't do it." Mr. McClain said that he, too, was part of the H2A program for a while. That program requires that workers be paid (about) $3 per hour more than the $5.15 going rate. Off the H2A program, Mr. McClain said that his company still does not pay anyone less than $7 an hour. Mr. McClain also noted that frivolous lawsuits cost Vidalia H2A growers millions of dollars in legal fees. "We never lost one, but it costs us millions to pay attorneys $200 to $300 an hour."

Mr. Herndon said that he grows and harvests all his Vidalia onion production by hand. "There are some machines that work for gathering, but I don't own one and I don't want to get into that. After onions are done, I grow sweet corn, then greens, so I have got to have hand labor 12 months a year to run my farm."

Mr. Sikes said that Vidalia has had the warmest winter on record this season. The crop harvest could be earlier than normal. Vidalia normally does not harvest "quality onions" before mid-April.

Mango importer expects steady supplies through Peruvian season

"We are just coming off our Ecuadorian fruit," and the Peruvian product has begun to arrive, making for "a very smooth transition from Ecuador to Peru compared to last year," Jesus (Chuy) Loza, a principal at Freska International LLC in Ventura, CA, told The Produce News Jan. 21.

Mr. Loza founded Freska Produce International LLC along with partner Gary D. Clevenger in August 2004. Both were previously with Fresh Directions International, also in Ventura. Freska, one of the top mango importers in the United States, marketed around 7 million boxes of mangos last year, according to Mr. Loza.

He expects steady supplies of mangos during the Peruvian season and a smooth transition as well into the Mexican mango season starting in late February.

"At this time last year, Ecuador had more volume and Peru had a very early peak," he said. Arrivals of mangos from Peru as of mid-January last year were 30 percent higher than this year, and Ecuador still had volume, "so there wasn't the best transition," and as a result, "market conditions last year were very, very tough." Returns were "not all that great," he said.

By contrast, "this year the transition has been very smooth. Peru is looking at having a very steady supply of fruit" in contrast to last year's high peak, he said. So far this year, "the volume has been very steady and pricing has been very stable."

He expects that stability to continue throughout the Peruvian season. Peruvian mango arrivals in the United States should continue through mid-March, he said. "I am looking at a stable market [with] an average price of around four-and-a-half dollars through the Peruvian season," he said.

Mr. Loza anticipates a smooth transition from Peru to Mexico as well. By the time Mexican mangos start arriving in limited volume during the latter part of February, the Peruvian volume should be "winding down," he said. "So the next few months should be a very stable market on the mango front, be it from whatever origin."

According to the company's web site, Freska was established "with the sole purpose of sourcing the freshest mangos and limes from around the world to provide to our customers. Freska Produce International sources mangos from Brazil, Ecuador, Peru, Nicaragua, Guatemala and Mexico. We have availability 365 days a year with varieties such as Hadens, Tommy Atkins, Ataulfos, Kents and Keitts. Our year-round availability means that there is no seasonality of our mangos and consistent supplies available to you."

With production from several countries, "we tend to have a very steady supply 52 weeks out of the year with promotable volumes through the year," Mr. Loza said. "We have just completed our first full year. We did around 7 million packages," he said. "We have projected this coming year to grow around 10 to 15 percent from last year, and we really haven't had any bumps in the road. We have had very good retail support and grower support. We couldn't have had a better first year."

For the current Peruvian season, "we plan on importing roughly around 1 million boxes," he said. "This is coming off 1.5 million boxes out of Ecuador. We should have very good promotable volume through the Peruvian season." Freska will be "one of the top importers out of Peru," he said.

The mangos from Peru are the Kent variety, Mr. Loza continued. "We pack either the 'Freska' label or the 'MangoPro' label."

The quality of mangos from Peru so far this season has been "excellent," and "the reception from customers has been very good," he said.

However, "the sizing curve is a little bit larger" this year for mangos from Peru than from other areas. "We are picking 8s, 9s and 10s" primarily, which means there will be "a lot less" of the medium-sized mangos that most retailers prefer. "Conventional retail likes to push primarily 12s," he said. But this year retailers will need to "switch over to 9s and 10s, which is where the volume is," during the Peruvian season.

Freska will start its Mexican mango program this year with some Ataulfo mangos, a yellow variety, around the second week of February, with a limited supply of Tommy Atkins starting the last week in February.

"We are predicting very good transitions from growing area to growing area," he said.

The Mexican season should go through September, with Brazil starting in August as Mexico begins to taper off. Brazil will continue into October, and Ecuador will start again in early October, Mr. Loza said.

Electronic data interchange transactions being scrutinized by PACA

A produce seller using electronic data interchange when invoicing for product may not be protecting its PACA Trust rights because of a potentially inherent flaw in that system. The U.S. Department of Agriculture has issued an advance notice of a proposed rule-making in response to these concerns raised by Western Growers Association and other industry members.

Tom Oliveri, WGA's director of marketing services and trade practices, said that the association has warned its members of the potential problem and proposed solutions. Mr. Oliveri said that regulations governing trust protection under the Perishable Agricultural Commodities Act allow shippers to preserve their trust rights by putting specific language on their invoice to buyers. However, some EDI systems do not allow that language to be transmitted from shipper to receiver.

"There are EDI systems out there where the PACA trust language is delivered, but there are other systems that have no field to include the language. And some buyers, who pay for EDI invoicing by the number of characters transmitted, have told shippers to omit that language," Mr. Oliveri said. "Until this issue is cleared up, we are advising our members to consider going back to the old system of filing trust notices with the buyer when the invoice approaches past-due status."

When the PACA Trust was first established, shippers had to protect their rights by filing trust notices with both the receiver and the PACA if the invoice was not paid within about 40 days - the 10 days prescribed by law plus a 30-day grace period. Because this resulted in mountains of paperwork, the regulations were changed so just the receiver had to be notified and shippers could do so preemptively by including the appropriate language on the invoice. Mr. Oliveri said that the current regulations would allow for sufficient protection of trust rights if a shipper faxed the receiver a trust notice at the 40-day mark.

Mr. Oliveri added that the Western Growers Association has spelled out to the PACA five specific areas where it has concerns with EDI transmissions:

o The buyer either willingly or through oversight does not receive the entire electronic transmission of the EDI invoice.

o The buyer does not download the trust information.

o The buyer does not opt to receive the information.

o The buyer does not buy the data field that allows the inclusion of the trust language.

o The EDI service provider does not translate the field that contains the trust language.

Mr. Oliveri said that attorneys familiar with the PACA Trust language have indicated that the act of a seller transmitting the language in good faith via EDI might be sufficient to preserve the trust rights, but it is possible that a bankruptcy judge may see it differently without clarifying language from the USDA. WGA is encouraging its members to respond to the USDA advanced notice and asking the agency to modify the PACA regulations to deal with this issue and "protect shippers when electronically invoicing for fresh fruits and vegetables, and allow coverage under the statutory trust on all EDI transmissions so that it is mandatory and not discretionary for the buyer to accept the notice to preserve trust benefits."

The notice was published Jan. 30 in the Federal Register and allowed a 45-day comment period.

Blyer joins Merex Corp.

Charles (Buzzy) Blyer has been appointed sales manager for Bon Campo, Bon Campo Trattoria and Winterglow consumer packaged goods for Merex Corp., which has operations in Miami, Yonkers, NY, and Phoenix.

Mr. Blyer will work out of the New York area, calling on retail accounts, offering year-round programs, launching the new "Trattoria" brand, and coordinating in-store promotions that feature Bon Campo's three-star chef, Mathieu Frey.

A veteran of the produce business with more than 25 years of experience in the trade, he came to Merex from Herb Thyme Farms in Compton, CA, where he worked for four years as a regional sales manager. Previously he worked in sales for Noreast Fresh in Boston, Ready Pac Produce in Irwindale, CA, and Florence, NJ, the National Oats Co. in Cedar Rapids, IA, and Tenneco West in Bakersfield, CA.

Mr. Blyer is a member of the New England Produce Council and the Eastern Produce Council.

International standards group to incorporate

The International Federation for Produce Coding is incorporating in England in the first quarter of 2006. The organization will become an independent entity, and "if all goes as planned," it will "probably" become the International Federation for Produce Standards, according to the group's secretary-general, Alicia Calhoun.

Ms. Calhoun serves in that capacity from her post as director of industry technology and standards for the Produce Marketing Association in Newark, DE.

The International Federation for Produce Coding is a coalition of fruit and vegetable associations from around the globe that joined together in 2001 as equal partners to pursue the task of introducing a global standard for the use of international price look up numbers. The group's work is coordinated by the PMA, and the federation's members (in addition to Ms. Calhoun) are based in four regions: Chairman Doug Henderson of the Fresh Produce Consortium in the United Kingdom; Latin American representative Ron Bown of the Chilean Exporters Association in Chile; North American representative and Produce Electronic Identification Board Chairman Don Harris of Wild Oats Markets; and Asia / Pacific representative Richard Bennett of Horticulture Australia.

Ms. Calhoun said that the Canadian Produce Marketing Association is also "pretty heavily" involved with the federation, and the Ottawa-based association's Jane Proctor leads Canada's involvement in the global group.

Ms. Calhoun does not expect the incorporation to bring many changes to the organizations beyond its establishment of a more formal identity. But, she added, "We are trying to reach to other regions and other standards and initiatives other than PLUs. We will see as time goes by" how those efforts materialize. The long-term objective of the federation is to develop comprehensive solutions on product identification for the entire produce industry supply chain.

Ms. Calhoun said that her time and PMA's involvement in the global group are "part of what PMA is doing" to have the global industry involved in developing efficient worldwide industry standards. "We can't just focus on North American standards any more. There are many players [outside North America] that need to be connected. We keep the dialogue going with the right players to assure that happens."

Over these last five years, this "has worked extremely well." PMA "will continue to administrate" the organization, "but it will have its own life as well."

Ms. Calhoun said that most of her work is implementing federation meetings, which are held each spring, then again each fall at the PMA convention. She said that PMA has been involved in standardizing PLUs since the 1980s.