Florida citrus growers get good news for a change
Florida citrus growers get good news for a change
Although Florida's 2006-07 Indian River grapefruit crop volume is at its lowest in at least 30 years, the price per box in the coming season is higher than producers there have seen in several years.
The supply-and-demand phenomenon is common in the produce industry. Prices rise when commodity volumes drop because of growing conditions or other reasons, and the result is that consumers are willing to pay more money for those products. These price increases are welcomed by growers and others along the supply chain because they help to maintain an economic state that is vital to the survival of businesses.
This is precisely what is happening with the entire citrus industry in Florida currently, but the fresh market will feel the effects most in the grapefruit category.
A study conducted by the Florida Department of Citrus in Lakeland and released by the Florida Department of Agriculture & Consumer Services shows that state-grown citrus will draw more than $1 billion in sales this season - the highest figure in six years, according to Doug Bournique, executive vice president of the Indian River Citrus League in Vero Beach.
"It is based purely on data from sales. The higher prices are an implication that Florida's citrus wasn't worth as much money in past years as it is today. It also confirms that, although the citrus industry is smaller than since before the 1970s, it is of significant importance to the state's economy. The increases are primarily in processed oranges and fresh-market grapefruit."
The past decade has taken a serious toll on Florida's once $9 billion-a-year citrus industry. Growers have suffered with canker disease and citrus greening, and an onslaught of hurricanes during the 2004 and 2005 seasons. The Indian River district, a region that is famous for its high-quality grapefruit that reaches the fresh market around the world, suffered as badly or worse than other citrus-growing areas.
Commenting that the Indian River region is now comprised of 621,000 acres of commercial grapefruit groves, Mr. Bournique said, "Compare that to the 941,000 acres of groves in 1970. In 1996, just 10 years ago, we were at 857,000 commercial acres. Much of that difference was attributed to the fast growth and development of land in Florida. That movement is still happening, but under even more stressful circumstances. Growers who have lost their groves, or part of them, or were damaged by the hurricanes, began reconsidering the offers developers were making for their land. Many have sold out, feeling that they are fighting a lost cause with all the problems they have suffered over the years. We have lost 215,000 acres to disease and the impact of urbanization alone, and most of the balance was crop loss from storms. Without their crops, growers could not meet bank loans and other responsibilities, so the high land values became an even greater temptation than when they were reaping good crop volumes and quality."
The increased crop value is great news for Florida citrus, but it is highlighted by even better news. Mr. Bournique said that the coming season's crop is expected to be the highest quality the state has seen in 30 years or more. This also helps drive prices for fruit higher. He noted that those in the industry are celebrating, albeit with trepidation and hope.
"The hurricane season isn't officially over until mid-October, so we are still holding our breath," said Mr. Bournique. "But many growers are already crowing about the great quality they expect. Indian River grapefruit production went from between 40 [million] and 41 million field boxes pre- hurricane years to about 12 million last year. This year we anticipate between 24 [million] and 25 million boxes. The slight increase is positive, but the great quality is the best possible news we could hope for under the current circumstances."
The exceptional-quality crop means that growers will have high packouts this season, meaning more of the crop will go to the fresh market rather than to processing. Returns are better on fresh, so that is added good news.
"We had perfect weather going into the growing season," said Mr. Bournique. "We will see initial movement in early October, with major volumes following by about two weeks."
Florida's 621,000 acres is comprised of about 65,500 acres of grapefruit grown for the fresh market, 30,000 acres of specialty citrus such as tangerines, also for the fresh market, with the balance in oranges, the majority of which go to processing.
Mr. Bournique added that growers who don't have citrus canker infestations in their groves stand a very good chance of coming out of this difficult period in Florida's citrus history on the upside, and continuing into the future as viable businesses.
"Growers here know that because of how property values have escalated, once they sell their property, there is no going back into it," he said. "When citrus in this state is gone, it is gone permanently because no one will be able to justify paying the high property prices to grow citrus."
The supply-and-demand phenomenon is common in the produce industry. Prices rise when commodity volumes drop because of growing conditions or other reasons, and the result is that consumers are willing to pay more money for those products. These price increases are welcomed by growers and others along the supply chain because they help to maintain an economic state that is vital to the survival of businesses.
This is precisely what is happening with the entire citrus industry in Florida currently, but the fresh market will feel the effects most in the grapefruit category.
A study conducted by the Florida Department of Citrus in Lakeland and released by the Florida Department of Agriculture & Consumer Services shows that state-grown citrus will draw more than $1 billion in sales this season - the highest figure in six years, according to Doug Bournique, executive vice president of the Indian River Citrus League in Vero Beach.
"It is based purely on data from sales. The higher prices are an implication that Florida's citrus wasn't worth as much money in past years as it is today. It also confirms that, although the citrus industry is smaller than since before the 1970s, it is of significant importance to the state's economy. The increases are primarily in processed oranges and fresh-market grapefruit."
The past decade has taken a serious toll on Florida's once $9 billion-a-year citrus industry. Growers have suffered with canker disease and citrus greening, and an onslaught of hurricanes during the 2004 and 2005 seasons. The Indian River district, a region that is famous for its high-quality grapefruit that reaches the fresh market around the world, suffered as badly or worse than other citrus-growing areas.
Commenting that the Indian River region is now comprised of 621,000 acres of commercial grapefruit groves, Mr. Bournique said, "Compare that to the 941,000 acres of groves in 1970. In 1996, just 10 years ago, we were at 857,000 commercial acres. Much of that difference was attributed to the fast growth and development of land in Florida. That movement is still happening, but under even more stressful circumstances. Growers who have lost their groves, or part of them, or were damaged by the hurricanes, began reconsidering the offers developers were making for their land. Many have sold out, feeling that they are fighting a lost cause with all the problems they have suffered over the years. We have lost 215,000 acres to disease and the impact of urbanization alone, and most of the balance was crop loss from storms. Without their crops, growers could not meet bank loans and other responsibilities, so the high land values became an even greater temptation than when they were reaping good crop volumes and quality."
The increased crop value is great news for Florida citrus, but it is highlighted by even better news. Mr. Bournique said that the coming season's crop is expected to be the highest quality the state has seen in 30 years or more. This also helps drive prices for fruit higher. He noted that those in the industry are celebrating, albeit with trepidation and hope.
"The hurricane season isn't officially over until mid-October, so we are still holding our breath," said Mr. Bournique. "But many growers are already crowing about the great quality they expect. Indian River grapefruit production went from between 40 [million] and 41 million field boxes pre- hurricane years to about 12 million last year. This year we anticipate between 24 [million] and 25 million boxes. The slight increase is positive, but the great quality is the best possible news we could hope for under the current circumstances."
The exceptional-quality crop means that growers will have high packouts this season, meaning more of the crop will go to the fresh market rather than to processing. Returns are better on fresh, so that is added good news.
"We had perfect weather going into the growing season," said Mr. Bournique. "We will see initial movement in early October, with major volumes following by about two weeks."
Florida's 621,000 acres is comprised of about 65,500 acres of grapefruit grown for the fresh market, 30,000 acres of specialty citrus such as tangerines, also for the fresh market, with the balance in oranges, the majority of which go to processing.
Mr. Bournique added that growers who don't have citrus canker infestations in their groves stand a very good chance of coming out of this difficult period in Florida's citrus history on the upside, and continuing into the future as viable businesses.
"Growers here know that because of how property values have escalated, once they sell their property, there is no going back into it," he said. "When citrus in this state is gone, it is gone permanently because no one will be able to justify paying the high property prices to grow citrus."
