The cranberry industry, soured by a huge surplus, suddenly has a new worry: The USDA will remove too many berries from the market this year.
The Cranberry Marketing Committee is asking the USDA to order handlers to give away or dispose of 5 percent of the 2017 crop, instead of the 15 percent the committee recommended last summer.
Mother Nature has been swifter to act than the USDA. The U.S. harvest was about 10 percent smaller than expected. The marketing committee and Ocean Spray, which controls a majority of the cranberries, agree that a combined 25 percent reduction would be too much for growers to financially absorb in one year.
“If USDA ignores the (committee’s) recommendation to lower the restricted percentage, it risks the unintended consequences of overcorrecting the industry’s supply issues,” Ocean Spray CEO and President Randy Papadellis wrote to USDA this month.
The USDA, largely embracing the industry’s request, proposed in January a mandatory 15 percent volume reduction. The agency has not made a final decision.
The cranberry committee in August sought federal intervention to reduce a surplus that was projected to reach 115 percent of annual sales. The fall harvest, however, was smaller than anticipated across the U.S., with the exception of Oregon. The industry blames drought and deer damage, along with farmers cutting back on production because of low berry prices. Harvests also fell short of projections in Canada.
The cranberry committee and Ocean Spray now say the industry can still meet its volume-reduction goal with a 5 percent cut. A 15 percent reduction on a small crop could drive this year’s returns below what some small farmers and handlers could sustain, according to Papadellis.
Not all cranberry farmers see it that way. Some growers say the small crop and a 15 percent reduction would speed up bringing supply and demand in line. In fact, while asking for the 2017 volume control to be scaled back, the cranberry committee is petitioning the USDA to order a 25 percent cut in the 2018 crop.
Washington farmer Malcolm McPhail, an Ocean Spray grower, said he understood the short-term advantage of scaling back 2017 volume controls, but the small crop was probably a fluke, he said.
“We were lucky,” McPhail said. “There’s no good reason for crops to be down two years in a row. Next year, we’ll have another big crop, and we’ll be right back in the thick of things.”
Volume reduction has strong support from the industry’s cranberry committee, but some growers and handlers, particularly outside the Ocean Spray cooperative, oppose a mandatory cut in supply.
The cranberry surplus is largely in the form of juice concentrate, but the marketing order would also require disposing of fresh fruit.
California-based Mariani Packing Co., makers of dried-fruit products, asserted in comments to the USDA that withholding raw fruit would not be in the public interest. The smaller 2017 crop likely will mean a shortage of raw cranberries and sweet dried cranberries, according to the company.
Organic cranberries would be exempted from the order.