With a small crop expected this season, San Joaquin Valley raisin growers are trying to put pressure on the region’s packers to pay them more for their fruit.
The farmers’ industry representative, the Raisin Bargaining Association, is urging its members to place their raisins in storage until both sides can agree on a price for this year’s crop.
Last year, raisin farmers were paid $1,650 a ton for a bumper crop of raisins. This year, poor growing weather and the drought has produced a much smaller crop. Some farmers estimate their crop may be off by 10% to 40%.
“We have had relatively large crops in the past, but not this year,” said grower Monte Schutz. “We are going to need a higher price to be able to turn a profit out of this thing.”
Raisin industry officials estimate the 2014 crop could come in at 308,000 tons, down from 364,000 in 2013.
The association’s proposal, delivered to the industry packers on Friday, is pushing for a per-ton price based on the size of the crop. For example, if the crop is larger than expected, such as 315,000 tons, growers would receive $1,750 a ton. But if the crop is smaller, such as 285,000 tons or less, growers would be paid $1,950 a ton.
RBA leaders say they are using the tactic of holding onto their raisins as a way to get packers to the bargaining table quicker.
“We are just trying to get a little leverage, but also to let the packers know what farmers are dealing with,” said Glen Goto, chief executive officer of the Fresno-based RBA.
Some farmers like Schutz have been plagued with water shortages and having to replace dry wells. Schutz is paying $40,000 for a new well, one that will be 200 feet deeper to reach his shrinking water table.
Several packers have been silent on the RBA’s proposal. Gerald Chooljian, president of Del Rey Packing, declined to comment directly on the RBA’s offer, saying he needed to review it. But he did say there are other issues, including foreign competition, that will factor into what the price will be for this year’s raisin crop.
“What we are hearing is that Turkey is going to have a much larger crop than they did than last year and they are being very aggressive in the market place,” Chooljian said. “If it were up to me I would say the field price needs to go up, but we have to look at lots of factors before making a decision.”