Vegetables and Melons Outlook - Vanishing asparagus acreage

From the 44-page Oct. 23 Vegetables and Melons Outlook. The section on asparagus caught my eye....

Production of fresh-market asparagus declined 22 percent in 2008 to 0.72 million cwt with reduced acreage (especially in California) accounting for the drop. California growers have reduced asparagus area 50 percent over the last decade in response to increased import competition, greater acreage in other States and lower prices. Area has also been seriously eroded in Washington State, largely the result of plant closings/moving by asparagus processors. In 1989, Washington harvested 32,000 acres of asparagus but is now down to just 6,500 acres. In Michigan, where most of the crop is processed, harvested area dropped from 23,000 in 1989 to 11,200 acres in 2008. Between 2000 and 2008, the value of the U.S. fresh-market asparagus crop has dropped from $176 million to $64 million.

Imports have continued to fill in behind domestic producers in 2008. The volume of fresh asparagus imports during January-July was up 15 percent from the same period a year earlier and 73 percent above that of 5 years ago. Fresh asparagus imports are three times as large as a decade earlier, with imports now satisfying two-thirds of domestic consumption. Mexico and Peru accounted for most of the fresh asparagus volume imported through July. Although both countries are year round asparagus suppliers, volume from Mexico is greatest during the winter, while shipments from Peru are strong from late summer through the end of the year. With imports filling in for domestic output, U.S. per capita use of asparagus in 2008 is expected to remain steady at 1.17 pounds.

Potato predictions

Gary Lucier and company have delivered another fact filled Vegetable and Melon Outlook report. Find the link to the USDA ERS Vegetables and Melon report here. From the summary:

Total 2008 U.S. potato acreage is estimated to be down 8 percent from a year earlier due partly to competition for acreage with crops such as sugar beets or wheat in Idaho and corn or wheat in other growing areas. Fall-season area planted was the lowest since 1951. With lower acreage and tight storage supplies for both fresh and processing varieties, prices are expected to remain strong into early fall. The average farm price for all U.S. potatoes in July was 11.4 cents per pound—up 35 percent from a year earlier.

On peppers:

The popularity of chile (pungent) peppers has increased over the past 2 decades and imports of fresh chiles have grown along with domestic demand. In 2007, a record 563 million pounds of fresh-market chile peppers were imported—up 72 percent since 2000 and 188 percent since 1995. Through June, chile pepper imports were up 28 percent from a year earlier in 2008. About 98 percent of U.S. fresh-market chile pepper imports come from Mexico. For all chile peppers (fresh and processed), imports accounted for about 76 percent of U.S. consumption in 2007. In 2007, per capita use of chile peppers (on a fresh-weight basis) totaled 6.1 pounds—up nearly 1 pound from 2000.

On fresh vegetables:

Expected reductions in yield and area harvested for summer storage onions (the primary source of onions during the fall and winter) will combine to reduce production moderately from the 57.3 million hundredweight (cwt) of 2007. This crop will transition from the summer nonstorage onion crop, which is expected to total 10.4 million cwt—down 9 percent from a year earlier.Following a spring featuring relatively weak prices, fresh dry-bulb onion prices have slowly begun to strengthen this summer and are expected to average well above the lows of a year earlier into next spring. This summer, given lower area for harvest, fresh vegetable prices are expected to average slightly above the highs of a year ago despite relatively weak demand caused by the slowing economy.

On melons:

This summer (largely July-September), area for harvest of the three leading melon crops was estimated to be 109,900 acres—8 percent below a year earlier. Area is expected to be lower for each of the three melon crops. With area down 11 percent in Georgia due partly to drought, watermelon area is expected to drop 9 percent from a year earlier. With reduced market volume for all melons, prices have remained above a year earlier, with July wholesale prices for all melons averaging 42 percent higher.

Vegetable and Melon Outlook - Rapid input price increases sqeeze farmers

The June 26 USDA ERS Vegetables and Melons Outlook report is available here. Gary Lucier and Rachael Dettman authored the report and headlined the summary with the discussion of fast-rising input prices:

Vegetable and melon net returns are being eroded by rapidly escalating input prices, particularly for fuel and fertilizer. Based on an index calculated by ERS using items pertinent to vegetable production, average input prices paid by vegetable and melon growers increased 7 percent in 2006, 8 percent in 2007, and are currently running 14 percent above a year earlier so far in 2008. At the same time, average prices received by commercial vegetable growers have not kept pace and are currently running below a year earlier.


More highlights from the report:


Tablestock Russet potatoes shipped from Idaho increased 70 percent to $14.63 per 50 pound carton. Multiple factors may explain increased tablestock prices including quality concerns in the 2007 storage crop, decreased spring acreage, delayed development in summer and fall crops, and increased export volume.
Sweet potato production has risen an average rate of 5 percent annually since 1998, due to improving demand for fresh and processed sweet potatoes. Demand will likely remain strong well into next year due in part to the increased popularity of sweet potato fries, which can now be found on restaurant menus across the nation.

More highlights..or lowlights.....


Fresh vegetables: During the first 5 months of 2008, fresh-market vegetable prices at the point of first sale (e.g., grower or shipping point) averaged 16 percent below a year earlier. Lower average prices were received for vegetable crops such as celery, cucumbers, lettuce, snap beans, and carrots, easily outweighing higher average prices for tomatoes and cauliflower. With a large storage crop last fall, fresh drybulb onion prices were a fraction of the highs of a year earlier through April. Fresh vegetable shipping-point prices will likely be under upward pressure this summer as growers battle higher production costs and water-related issues.
Melons: Similar to the situation a year ago, spring supplies have begun to improve after a late start caused by a combination of cool, wet weather. April-May producer prices for melon crops averaged 17 percent above a year ago. However, although May shipments of watermelon, cantaloup, and honeydew increased seasonally, only watermelon volume managed to exceed year-earlier levels. As a result, average melon prices during May remained near the highs of a year ago.
Mushrooms: During the initial 5 months of 2007, the average import value for fresh agaricus mushrooms declined 9 percent from a year earlier to $1.24/pound. During the same time, the average import value for non-agaricus specialty mushrooms increased 15 percent to $0.84/pound.

More on input prices...

Input prices play a major role in farm production expenses and farm profitability. Over the past decade, prices paid (unadjusted for inflation) by vegetable and melon growers for production inputs have moved steadily higher. An index calculated by ERS using items pertinent to vegetable production (leaves out farm-origin inputs like feed and livestock) indicates that average input prices increased 7 percent in 2006, 8 percent in 2007, and is currently running 14 percent above a year earlier in 2008. This easily exceeds price changes in the general economy over the past few years. At the same time, average prices received by commercial vegetable growers have not kept pace and are currently running below a year earlier. Price changes are not the only factors determining net farm revenue. Over the long run, rising yields can help spread escalating costs over more units, keeping the farm cost per pound of vegetables down. However, when input prices rise sharply over a short period of
time as they have since 2007 (fig. 10), increases in per-acre yields can not overcome these rapid cost increases, pulling net revenue down.

TK: The 41-page USDA report includes a table show second quarter 2008 input costs rising, compared with the second quarter a year ago, by 30% for seed, 64% for fertilizer and 46% for fuels.

Odds and ends

Congratulations to all associations and lobbyists working with the Specialty Crop Farm Bill Alliance, with a special nod to United Fresh. While the larger farm bill has some pork and "airdropped earmarks" - what a great phrase, by the way - the specialty crop coalition may have set the model for federal support designed to boost competitiveness and improve public health with nary a worry for adjusted gross income limits of growers.

I just "rejected" an anonymous comment about Agriculture Secretary Ed Schafer. It didn't really offer much of reasoned critique, merely a unrestrained slam. Let's keep the criticism intelligent and issue and policy based, please.

The USDA's 196 page pdf of the Vegetable and Melon report is now available.

Check out the summary below:


U.S. production of all vegetables, potatoes, melons, and pulse crops increased 5 percent in calendar year 2007. In addition, fresh and processed imports for these crops were above a year earlier plus inventories of processed vegetables coming into the year were greater. As a result, total vegetable and melon supplies available for domestic use and export were up 5 percent to about 181 billion pounds in 2007. Buoyed by larger supplies, per capita net domestic use (disappearance) of all vegetables, potatoes, melons, and pulse crops increased 2 percent to 444 pounds (fresh-weight basis) in 2007. Potatoes (including potato products) remained the top vegetable crop in the United States (28 percent of total use), followed by tomatoes and products (20 percent), all lettuce (8 percent), sweet corn and products (6 percent), and onions (5 percent). Retail prices for fresh market vegetables increased 3 percent in 2007—the second smallest increase this decade. So far in the 2000s, fresh vegetable retail prices have increased an average of 4 percent annually, about the same as during the 1990s when prices were more variable. Consumer prices for processed fruit and vegetables increased 4 percent in 2007—the largest year-over-year gain since 2002. Although prices for frozen vegetables were little changed from a year earlier, for the second consecutive year, retail prices for canned and dried vegetables rose 3 percent. The farm value share of the retail cost of all fresh vegetables increased 4 percent in 2007 to an estimated 19.6 percent. The farm value share increased for fresh tomatoes and lettuce but declined for broccoli and potatoes. Although it has been relatively steady over the past 5 years, the share of retail value accounted for by the shipping-point price of fresh tomatoes has averaged about 28 percent this decade—down from 31 percent in the 1990s and 37 percent during the 1980s. The vegetable and melon trade deficit widened in 2007 as the value of imports increased more than the value of vegetable and melon exports. In 2007, nearly 17 percent of all the vegetables and melons consumed domestically was imported, with 32 percent of frozen vegetables being sourced from other nations, compared with 18 percent a decade earlier.