Apr 7, 2007

Regions Work More Closely Together to Sell Crop

The threat of offshore fresh asparagus imports is bringing North American asparagus growers closer together. There are tentative plans to cooperate on research and even marketing, according to representatives of Michigan Asparagus Advisory Board, the Ontario Asparagus Growers Marketing Board and the Washington Asparagus Commission.

John Bakker, executive director of the Michigan board, spoke at the Ontario board’s annual meeting in Woodstock, Ontario, in late December. He said that by opening up the lines of communication, growers from across the three growing regions can benefit.

“We don’t need to be competing with each other. There’s a market out there for all of us,” Bakker said.

Alan Schreiber also spoke at the Ontario meeting. He said that while Washington and Michigan growers have a history of collaborating in research, government relations and other areas, cooperation in the area of marketing is new. Extending this type of approach to include Ontario makes sense, he said.

Jeff Wilson, the newly elected chair of the Ontario board, agreed.

“It was almost like a bolt of lightning coming out of the sky,” Wilson said. “Are we going to compete with each other in the same markets, when there isn’t a need to, or do we start working collectively and collaboratively so we can address the real ‘enemy,’ which is the competition from Peru.”

The Peruvians grow asparagus year round with low labor costs. They already dominate the global canning industry, Wilson said. Chinese growers, meanwhile, have done just about the same with the frozen product.

Bakker said he understands the threat. He said Michigan’s processing industry, which takes the lion’s share of the state’s asparagus production, isn’t growing and may be shrinking. That makes fresh market asparagus more important to the state’s growers.

Besides, Michigan Asparagus Growers Inc. (MAGI), a cooperative of roughly 15 to 17 growers, has demonstrated that a little cooperation can have a positive impact on farm-gate prices, Bakker said. About 50 percent of Michigan’s fresh market asparagus – more than a million pounds – is marketed by MAGI.

Michigan grows more than 20 million pounds of asparagus. The lion’s share is processed, but fresh market sales are becoming more important.

Approximately 200 growers in Washington state produce roughly 60 million pounds a year. Little processing remains in the state.

Ontario growers lost their processing industry entirely. The last large processor in Eastern Canada – located in Quebec – stopped taking Ontario asparagus in 2003. Ontario’s 121 growers produce close to 10 million pounds on 2,800 acres.

California is the largest North American asparagus-growing region, with about 80 million pounds produced annually. Schreiber said there’s been some cooperation between Washington and California growers, but the Washington/Michigan relationship is stronger.

California’s harvest begins in January and continues well into spring. Washington State growers begin to harvest in April while production in Michigan and Ontario begins around early May.

Wilson said that while Ontario is a small player on the North American scene, even a single truckload of product can disrupt a market. The same thing can occur if U.S. product enters the Ontario market.

A quarter of Ontario’s production was marketed through a Michigan broker, although it did not necessarily end up on Michigan grocery store shelves, Bakker said.

With a collaborative approach to marketing, transportation costs can be reduced and market disruptions minimized, Wilson said.

Marketing discussions between Ontario, Michigan and Washington are in the preliminary stages. Bakker suspected there would be no formal agreement on marketing for a year, if not longer.

Discussions concerning joint research projects between the U.S. and Canada are probably further advanced, though still preliminary. Ontario is recognized as a world leader in variety development while Michigan has an excellent plant pathology program, Wilson said.

Growers across North America are deeply concerned about Peruvian fresh market competition to their spring crop, Wilson said.

The South American product, landed at Miami and the west coast, is already making inroads in Florida and other areas at the time when North American growers are harvesting their crop.

The Peruvians grow asparagus all year, just inland from the Pacific Ocean, Wilson said. By turning irrigation systems on and off, fields of asparagus can be either brought into production or returned to dormancy.

North American growers do not have that option: their crop is seasonal.