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Florida blueberry industry already at crossroads as it matures

Florida’s blueberry industry came from a standing start to a significant present and an even more promising future in roughly a decade, but already the industry is at a crossroads of sorts. Smaller producers are falling by the wayside as major players and outside influences maneuver to propel the deal to the next level as the industry matures.

What made the Florida blueberry industry prosper and then thrive was the arrival Fl-Blues-3Blueberries from Cottle Strawberry Nurseries Florida farms. Cottle has recently joined a raft of newcomers into the Florida blueberry deal. (Photo courtesy of Cottle Strawberry Nurseries)of new cultivars out of the University of Florida Institute of Food & Agricultural Science (IFAS) designed to fill in the gap between the end of the Chilean import season and the onset of the domestic season in Georgia (a state that is positioned to become the top U.S. producer of blueberries within 12-24 months).

For the last 50 years, Gatorade has been the top royalty producer for the university. Or was, until last year, when royalties from blueberry cultivars toppled the king of sports drinks from its throne.

The problem is some of those royalties are coming from places that are trying to develop industry that will chip away at Florida’s already narrow exclusive blueberry window, the same window that has kept prices sky-high for what has been the first fresh crop of the calendar year (most of the Chilean berries that come to the United States after Jan. 1 are from storage crops that often trade freshness and taste for shipability).

With Florida producing the U.S.’s first domestic berries of the year in a season that typically begins in mid-March and extends into early May, growers are accustomed to premium prices for their product. Over the past few years, Florida blueberries have garnered $5 a pound or better in that window. Once Georgia enters the picture in May, the price drops to around $2.50 a pound, a pattern that feeds on itself as the season progresses northward and production in other states comes on.

IFAS had been selling those same early-bearing cultivars to other regions looking to horn in on Florida’s business. The Florida Blueberry Growers Association protested mightily, but it took the intervention of Florida Commissioner of Agriculture Adam Putnam to invoke a hiatus on such sales until the divide is resolved. Florida strawberry growers faced a similar situation a few years ago before the Florida Strawberry Growers Association stepped in and straightened things out.

But even as the royalty war wages, Florida blueberry growers are looking at competition in their own backyards and from companies based in other states. The early bounty for the first domestic fruit of the year led growers large and small to hustle to get into the Florida blueberry deal. And while the market is hardly saturated, production has increased rapidly enough to likely signal an end to super-premium prices.

Production has already ramped up quicker than most Florida growers thought likely.

In 2011, projections were the Florida crop would total 16 million to 17 million pounds; instead, the total was 22 million pounds. Last year a freeze and prickly application issues with a growth regulator put a dent in a Florida crop that would have otherwise easily surpassed those projections.

“Certainly the returns to the grower have come down, which is not where the growers want to be, but the fact of the matter is blueberries are everywhere now and they’re affordable,” said Bill Braswell, president of the Florida Blueberry Growers Association. Mr. Braswell also operates a grove care service, BerryCare LLC, manages farms for Clear Springs Packing LLC of Bartow, FL, and grows berries at his own Juliana Farms. “At one time they were only in high-end, high-price stores. Now Publix and Walmart have them year-round. Even Dollar General now carries them. The closest store to my house with groceries is a Dollar General. I went in there the other day not expecting much, but they were carrying a full line of Driscoll’s berries. It’s great market penetration, but the other part of it is, it just shows you this thing’s nowhere near coming to an end. There are just so many other places you could be selling blueberries, on top of the fact that Mexicans are just starting to eat blueberries and South Americans don’t even eat blueberries yet. I’m pretty bullish on the industry even though a lot people think we’ve come to the end of the boom times.”

Until recent years, “We didn’t have competition from Chile, we didn’t have Mexico looming, we still had April all to ourselves,” Mr. Braswell said. “Now Chile lingers on a boat for a month, Georgia’s there already with early varieties, rolling the dice on a freeze, and we’re getting squeezed. We need to let people know we’re out there — simply let them know we’re there.”

In the last three years or so, California berry companies have raced into the Florida deal and now control a sizable portion of the market. SunnyRidge Farms was bought by powerhouse Dole Berry Company of Monterrey, CA. New players from all over come on the scene regularly.

One of those is longtime North Carolina berry producer Cottle Strawberry Nurseries, Inc., which has operations in several U.S. states as well as Mexico, Canada and Chile. The company has marketed Florida blues for other growers for quite some time, but this year is shipping fruit from its Florida farms under its own “Cottle Farms” label for the first time.

“Everybody’s fighting to preserve their window, everybody’s trying to get ahead of everybody else,” said owner Ron Cottle. “What I see with most of the smaller farmers — which is a good thing for the consumer — is that with all the quality and food-safety programs in place, it’s hard to implement these things on a small basis. That makes it very difficult for some of the smaller growers. In the chainstores where food safety and traceability used to be just talked about, it’s now demanded.”

“It is getting harder for smaller growers to stay in the game to a degree,” Mr. Braswell said. “When you go to Michigan or out West, one thing you see out there you don’t see much out here, is U-picks — you talk to those guys, they make a fortune. In Florida that’s pretty much untapped. When you’re making $8 a pound commercially picking why bother with U-pick. At $8 a pound with $2.50 of cost, maybe you’re netting $5 a pound which is still an incredible sum of money. But say it’s cut in half over the next few years and you’re U-picking for $4 a pound. You’re still making a lot of money. Granted you’re not going to sell 250,000 pounds on a small farm but it’s certainly an avenue for income and not a bad way to sell blueberries.

“Last year our return to the farmer was about $3.50 a pound after all expenses except harvest, that’s about 75 cents a pound. You do the math — it’s still a lot of money.”