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April 1996, Volume 2, Number 2

US/California FVH Production

The 39 billion pounds of fresh vegetables produced in the US in
1995 were worth about $7.4 billion, up almost $1 billion from 1994,
and the 55 billion pounds of fruit were worth $8.9 billion, up $400
million despite a 32 percent drop in California summer fruit
production due to storms.

The total value of what USDA defines as horticultural
production--fruits and vegetables plus greenhouse and nursery
products-- was $34.5 billion in 1995.

US demand for fruits and nuts, vegetables and melons, and
horticultural specialties such as mushrooms is expected to increase
by about two percent per year, double the rate of increase in the US
population because FVH consumption is tied to both population and
income growth-- disposable incomes have been rising slowly, just 1.3
percent per year in the 1990s. However, the proportion of income
spent on food has continued to decline--only 10 percent of the
average American household's income was spent on food in 1995.

The US is emerging as a major exporter of FVH commodities--about
15 percent of FVH production is exported--some $10.2 billion in 1995.
About one-third of these FVH exports are fresh fruits and vegetables,
and about 25 percent of the fresh fruit grown in the US is exported.
Export sales are growing by about five percent per year, and are
expected to top $17 billion in 2005.

FVH imports--worth $10.2 billion in 1995--are also expected to
increase by five percent annually.

California. Wet and cold weather reduced the production and
delayed the harvest of many California fruits and vegetables in 1995.
Growers typically receive higher prices because of smaller crops, but
farm workers usually earn less because there is less to pick, and
because more workers are competing for fewer jobs. Some farmers
reported that they hired the same number of pickers as in 1994
because weather damage and high prices justify a more careful pick.

California exported $2.5 billion worth of fruits and nuts in 1994,
including almonds worth $718 million and grapes worth $590 million.
About one-fourth of the 80 million cartons of citrus packed by
Sunkist-affiliated packing houses is exported, some 22 million
cartons in 1994, including 12 million cartons to Japan.

Many of California's FVH commodities receive US tax dollars
through the Market Promotion Program to export wine and oranges
abroad. US wineries such as Gallo, for example, received tax dollars
to match their own advertising expenditures. The US exported $192
million worth of wine in 1995.

The uneven crop outlook means that some farmers have record
profits, while others are in financial trouble. Over 23 percent of
USDA loans to California farmers were delinquent in mid-1995.

In March 1996, the Westlands Water District began trading water
rights electronically, permitting the 700 farmers with the right to
federal water to trade it with each other. If water is redirected to
its highest value usage, and the value of water becomes transparent
in a market, some farmers may sell their water to cities, or use it
on high value and labor-intensive crops.

Farmers were granted the right to make a profit by re-selling
their subsidized federal water in 1992.

The so-called California Farm 500 list reported that the 500
largest California farms accounted for $5.2 billion of the state's
$18 billion in farm sales in 1993; each had 1993 sales of $4.5
million or more. The JG Boswell cotton and alfalfa farm has annual
sales of $100 million, followed by Giumarra Vineyards, Dole Fresh
Fruit, Paramount Farming, and Monterey Mushrooms, with $50 million in
annual sales.

Rounding out the top 10 farms are Gerawan, Boskovich, Met West,
A&D Christopher Ranch, and Monrovia Nursery.

Western Farms, owned by the Bass Brothers from Texas, has acquired
about five percent of the 500,000 acres of farm land in the Imperial
Valley, and may be planning to double its holdings to 50,000 acres in
order to sell some of the 285,000 acre feet of Colorado river water
that comes at very low rates to this land.

In September 1995, San Diego entered into negotiations to buy some
of the water at prices of up to $400 per acre foot.

Boskovich Farms, based in Ventura county, farms 16,000 acres of
vegetables and strawberries in California and Arizona, and 4,000
acres of winter vegetables in Baja California.

FRUITS. The 1995 winter navel orange crop was projected to
be 76 million 37.5 pound cartons, up about 10 percent over year
earlier levels. The Orange Administrative Committee, which used to
regulate the flow of navel oranges to retail markets by setting
limits on how much each packing house could ship each week, was
terminated by USDA in 1993.

The apricot crop was projected to be down 30 to 50 percent in
1995, and the canning peach crop down 20 percent. The cherry crop for
1995 was projected to be only 1.7 million 18 pound packages, half its
1994 level, while the plum crop is projected to be down over
one-third, from 17 million cartons to 11 million cartons in 1995.

Almost two-thirds of the California cherries were exported to
Japan in 1995.

In many cases, production was near normal levels in 1995. There
were about nine million packages of plums produced in 1995, versus 11
million in 1994, 14 million packages of peaches, versus 19 million
packages in 1994, and 14 million packages of nectarines, versus 19
million packages in 1994.

The California fresh strawberry crop was a record 76 million trays
in 1994, and some projected 70 million trays in 1995 despite March,
1996 floods.

There was a record table grape crop in 1995--64 million 23-pound
boxes worth $859 or an average $13 per box, or $0.58 per pound.

A record 64 million 23-pound cartons of table grapes were produced
in 1995--average yields are about 6.75 tons per acre--and 11 million
cartons or about 18 percent of the California table grapes were
exported [In 1996, the table grape industry is switching to 20
pound cartons for Coachella Valley grapes, and 21 pound cartons for
San Joaquin Valley grapes]. The federal government provides about
$2.5 million per year through the Market Promotion Program to promote
US grapes overseas.

California table grape growers had an estimated $4 billion
invested in their industry in 1994, from which they generated sales
of almost $700 million in 1994, or $6,100 per acre.

Americans ate an average eight pounds of grapes per person in
1995, up sharply from the 1968 low of 1.2 pounds per person in 1968.
California supplied 60 percent of the grapes consumed by Americans;
Chile supplied 30 million cartons or 28 percent; Mexico supplied
eight million cartons or nine percent; and Arizona, two percent.

The total grape crop was expected to be five million tons,
including 2.25 tons of raisin grapes, 2.2 million for wine grapes,
and 640,000 tons of table grapes.

Some 400,000 tons of raisin grapes were expected to be sold in
1995 to wineries, and 200,000 tons sold for fresh grapes, leaving 1.6
million tons to be dried into raisin grapes. About five pounds of
raisin grapes are needed to obtain one pound of dried raisins, so
there are expected to be about 350,000 tons of raisins--they earned
an average $1,160 per ton for growers. There are about 180,000 tons
of raisins in storage, equivalent to half a year's crop.

The Washington apple crop was about 80 million 42-pound boxes in
1995. Washington produces about 60 percent of US fresh market apples,
and exports about 25 percent of them.

Americans consumed about 276 pounds of fresh-fruit equivalent per
person in 1994. About 60 percent of the fruit consumed--161 pounds
per person-- is non-citrus, such as peaches, apples, and grapes.
Americans average about 115 pounds of citrus--about 90 pounds is
processed, such as orange juice.

VEGETABLES. The largest acreage vegetable in California is
processing tomatoes, the small round tomatoes that were developed in
the 1960s to be harvested mechanically after the end of the Bracero
program--some 330,000 acres were planted in 1995, and they yielded an
average 33 tons per acre.

In 1995, there were a record almost 12 million short tons of
processing tomatoes produced. Americans each consumed a record 80
pounds of fresh-weight equivalent processing tomatoes in 1995, and
the total 20 billion pounds was five times the four million pounds of
fresh tomatoes consumed.

Asparagus acreage is estimated to be up 10 percent to 31,000 acres
in 1996. California's 135 asparagus growers produced about 78 million
pounds from 28,000 acres in 1995--growers export about 25 percent of
the asparagus produced.

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