The new 2000 fruit census was just released. Michigan fruit acreage declined by almost 13,000 acres. Most of the decline in Michigan and in Van Buren County was due to the depressed apple market and the removal of 11,500 acres of apples statewide. Van Buren and Berrien counties each lost 1900 acres of apples. Part of this was due to the fire blight epidemic that killed more than a 1000 acres of young apple trees in 2000. But that only accounts for a quarter of the lost acreage. The main reason is that growing apples is not the profitable enterprise that it was 20 or 30 years ago. Most of the acres removed were older trees with poor yields for the effort needed to maintain the planting or varieties whose price returns in the market made profit impossible.

Apples are no longer a locally grown and eaten commodity. Apples are now produced and sold throughout the world. Michigan growers are competing in a global market against cheap apples from Washington State, Chile and New Zealand and cheap Chinese apple juice dumped into the US juice market. The collapse of many Asian economies in 1999 led to the loss of the Pacific Rim markets by Washington apple growers. This left Washington with 30% more apples to market in the USA. That was more apples for the market to absorb than Michigan grows in a good year. This huge influx of apples caused the price for fresh apples to plummet as Washington sold apples at any price to reduce losses. This caused huge financial loses to all apple growers in the United States. Apple growers are now involved in a huge industry shake out as growers struggle to reduce costs. Some growers, processors and packing sheds will not survive the tough times coming.

I think the hard times in apples will continue for at least 5 years. It is quite possible that thousands of US apple growers will lose their farms. Apples and other fruits take a long time to grow. Because fruit orchards are so expensive to establish growers hesitate to remove them. It takes a long time for overproduction to rear its ugly head. And a long time for individual growers to respond to market pressures. Now we have a worldwide glut in apples and not all apple growers can continue to expand. No grower should continue to plan on the apple market that they knew only 4 or 5 years ago. Static commodity prices and rising costs are squeezing all of agriculture. It is becoming impossible for growers to maintain a middle class standard of living. In order to survive growers need to get bigger (live with less profit per acre), cut costs (I think we have gone about as far down that road as we can), grow smarter (increase profit per acre), sell smarter (find a niche market) or change their business.

Growers need to remove unprofitable blocks. They just take money from the business. An orchard block has to pay for the spray bill, the labor to prune and pick the trees and carry a portion of the overhead for the whole farm. It is possible to make more money on fewer acres, especially if some orchard blocks are not pulling their weight. The important thing is to make enough money to support the business and your family. If an orchard block does not make a profit it should be replaced. Plant only varieties you know will sell because there is a market. It is debatable whether any apple variety fits the bill in today's wholesale and processing apple market. If you grow for the roadside markets a lot of varieties make sense and you can grow a little of everything. If processing apples is your main market then plant varieties that processors want and will pay a premium for. I don't think many Michigan growers should be on the fresh market merry-go-round where varieties are planted before there is an established market in hopes of catching quick profits when a variety becomes popular and supplies are tight. That seems to me to be a crapshoot with equal chances for profit or loss.

The picture in most other fruits is the same, declining acreages and profits. Blueberries and grapes have been bright spots in the past but they are getting close to overproduction too. There are still lots of blueberries in the freezer but growers in other areas of the country think they can make money if they can grow blueberries so the glut is coming. Wine grapes are touted as a high value crop in most states but wine grapes and grape juice are cheap in California where they are easy to grow. Growers all over the world are always looking for a higher value crop to grow and putting pressure on established growers.

The time has come for tough choices. Growers need to examine their operations carefully and decide if the struggle to survive is worth the effort. Everyone assumes that it is the other guy who will fail. You need a new viewpoint. There is no shame in getting out with your assets while you still can. Those people who can get out of farming with their net worth intact will be winners not failures. Other growers will change the operations to survive. Some will emerge stronger, others will just hang on and some will lose the battle through no fault of the own, just in the wrong industry at the wrong time.

Ask yourself where you want to be in five or ten years. Stay in farming or get out. Then start planning how to get there. If you want to stay in fruit farming I think I can help. I know I do not have all the answers, but I do have a viewpoint that is not emotionally attached to your farm. I am available for consultations if you want to look at farm profitability or any other portion of your farm operations. I can help you come to a decision on where you want to be and how to get there.