Cherry co-op looks to value-added products
Oregon Cherry Growers Inc., a farmers' cooperative, is looking to diversify into new value-added products beyond maraschino cherries.
An Oregon farmers’ cooperative is looking to diversify beyond its mainstay maraschino cherries into new value-added products, and even into other fruit crops.
Oregon Cherry Growers Inc., based in Salem, Ore., is already a major player in the $50 million maraschino market but has turned its eye to the $1 billion fruit snacks sector, said CEO Tim Ramsey.
“Our future really is based on innovation,” said Ramsey, who has spent three decades in the food industry and stepped in to head the cooperative a year ago.
The cooperative is tilting toward pursuing the much larger snack market rather than focusing solely on growing its maraschino market share, which is already strong, he said.
Currently, about one-third of the company’s cherry tonnage is devoted to the fresh market and the rest goes into processing.
On the processed side of the business, half the fruit goes into maraschino production and the rest is used for ingredients, such as cherries for ice cream and Greek yogurt.
Next year, Oregon Cherry Growers will also roll out a “fragile fruits” line of products that relies on its proprietary method of infusing fruit with juice and drying it.
The processing technique allows delicate crops like raspberries and blackberries to retain their original appearance and flavor when dried, Ramsey said. Ordinarily, they become largely unrecognizable.
The company has already been selling blueberries processed using this method and is now in the final stage of research and development for cherries and caneberries, he said.
Over the long term, the cooperative wants to drive new growth in part by allowing its owners to supply the company with crops other than cherries, Ramsey said.
“If it doesn’t all come from cherries, that’s OK,” he said.
However, the cooperative is also trying to innovate with its traditional crop as well.
It soon plans to release several types of maraschino cherries made with natural flavors and colors, said Ramsey.
The product is targeted at consumers concerned about artificial colors and high fructose corn syrup, but it also aims to broaden the appeal of maraschinos beyond ice cream and cocktails, he said.
Oregon Cherry Growers is also researching the possibility of dedicating cherry acreage to producing “individually quick frozen” fruit.
Currently, IQF cherries are produced from fruit that didn’t make it into the fresh market — thus the supply and price are prone to volatility.
Ramsey said he hopes to determine if buyers would be willing to pay a stable price in return for predictable supplies of IQF cherries.
The price would need to pencil out for the retailer but also be high enough to justify dedicated production from farmers, he said.
If the project made financial sense, it could provide a boost for processed cherry acreage in Oregon’s Willamette Valley, which has seen a steep decline over the past decade, Ramsey said.
Labor shortages have convinced many small cherry producers to leave the industry if they couldn’t afford mechanized harvesters, said Jeff Olsen, extension horticulturist at Oregon State University.
“Unless you have a premium price, you can’t afford to pay a hand labor force,” he said.
Cherry acreage in the region has also suffered due to competition from other crops, like wine grapes, said Jay Pscheidt, a plant pathologist at OSU who works with tree fruits.
The fresh market for cherries is more lucrative than the processed market, but climatic conditions in the Willamette Valley complicate cultivation, he said.
The region is wetter than growing areas around The Dalles, Ore., so cherries are more prone to splitting, as well as fungal and bacterial diseases, Pscheidt said.
“The fresh market cultivars have more problems on the wet side of the Cascades,” he said. “All these things increase the expense and the trouble.”
Ramsey said it’s possible that Willamette Valley growers could plant the Lapin variety of cherries, which could generate quality fruit for the IQF market even though they wouldn’t have enough shelf life for the fresh market.
“I think the demand is there, but the question is whether the market will support dedicated acreage,” he said.