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Organics continue to gain ground in Washington apple business


Overview of the Washington organic apples supply, complemented by charts from Agronometrics.


Original published in ThePacker.com on September 18, 2020 

Organic apples out of Washington are a hot commodity and look to gain further ground in the coming years, marketers say.

“Organic is on fire,” said Roger Pepperl, marketing director with Wenatchee, Wash.-based grower-shipper Stemilt Growers LLC.

“We are seeing retailers hit 10% easily in apple sales percent. Now, many retailers are hitting 15% to 20% of their sales in organic apples. This takes strategy and attention, but the business is there for retailers who seek it.”

Volumes (in LB) of apple from Washington in the US market
Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)

Stemilt is ready for further increases in demand, having first gotten into organics more than 30 years ago, Pepperl said.

“We will have close to a 20% increase in organic apples this year. with an emphasis on Honeycrisp, gala, SweeTango, Piñata, fuji, Pink Lady and granny smith,” Pepperl said.

Volumes (in LB) of organic apples from Washington in the US market
Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)

“We have one of the best supplies on organic Honeycrisp in the industry — a very high-quality program.”

Selah, Wash.-based Rainier Fruit Co. is all-in on the organic category, too, said Blake Belknap, vice president of sales.

Looking ahead, given the year that’s been dominated by COVID-19 and all of its associated unpleasantness, including quarantining, Gipe-Stewart says that people are already looking forward to the holidays. “We think there’s a lot of opportunities for promotions around the holidays,” she says.

“We are thrilled with the recent momentum behind organic produce as a whole and are ready for another year-round season for 2020,” he said.

“This year we are proud to be the industry’s first domestically grown year-round organic Honeycrisp supplier, as well as continue our domestically grown year-round organic fuji, gala and granny smith to keep our customers supplied.”

Growth

Washington’s organic apple production continues to grow, and this year is no exception, said Tim Evans, manager of domestic and export sales with Chelan, Wash.-based grower-shipper Chelan Fresh.

Evans noted that Washington expects an organic-apple volume of 21.4 million bushels, compared to just over 15 million last season, “which is big growth year over year, but we still see big growth coming.”

Chelan Fresh’s organic program has kept pace with that growth trend, Evans said.

“Our organic program has been on a growth trajectory for the past several years and will continue to be a highlight for this fall,” he said. “We’ve really focused our efforts on the high-profile varieties that carry organic sales at retail.”

Honeycrisp, gala, fuji, granny smith and Pink Lady represent “a large market share” in the organic category, but there are proprietary cultivars, too, Evans said.

“We continue to develop our proprietary varieties in both conventional and organic, like Rockit and SugarBee,” he said.

Yakima, Wash.-based Sage Fruit Co. is working on growth, too, where organics are concerned, said Chuck Sinks, president of sales and marketing.

“The demand for organic has remained strong,” he said.

“Our organic program is continuing to grow. Not only are we planting new acreage of organic orchards, but we are actively transitioning many of our conventional orchards.”

This season

Washington’s organic apple crop, in general, looks “pretty good, similar to last year,” said Matt Roberts, sales manager with Mount Vernon, Wash.-based organic fruit shipper Viva Tierra Organic Inc.

“We’re still waiting to see on sizing,” he said Aug. 21. “Galas are going now; we just had our first regular gala packout yesterday. Despite everybody’s concern about them being down, they were huge. Honeycrisp are starting. Golds will start here next week.”

Weather has cooperated, Roberts said.

“It got a little hot for a while, slowed things down a little, but can’t complain,” he said. “No big hail events. We’re working with growers are all over the state, so our risks are sort of spread.”

Roberts said there will be more organic Cosmic Crisps this year than before.

“It’s a great apple, and there will be more of that available this year — not much more, but some,” he said.

“That’s one I think has a definitely has a good future. It stores well, even organically, so it’s something that we could take quite a while. There’s not a lot of apples we feel we can take very deep past the spring organically.”

Organics will continue to account for a larger share of Washington’s apple crop, said John Long, manager/director of sales and operations for Raleigh, N.C.-based L&M Co.’s Washington business unit in Union Gap, Wash.

“Growers keep moving in that direction,” he said. “You may see 15% of apples grown in Washington be organics.”

Marketing challenges

There are hurdles to marketing organic apples, Long said.

“The challenge in organics is you have a smaller marketplace,” he said.

“All the major retailers are carrying organics, but retailers only want the bulk sizes of, say, a 72 to 100, and they only want a top grade. As volume increases, you end up with a bigger percentage that has to go back to the conventional market. It’s a hard balance of growing enough but not growing too many. And right now, we’re getting to point where we’re growing too many.”

Wenatchee-based CMI Orchards has surpassed 3.5 million boxes a year of organic gala, fuji and Honeycrisp, as well as “branded organics, which create opportunities for retail pricing tiers that help boost sales,” the company said in a news release.

Prices (in USD of organic apples from Washington in the US market
Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)

“Organic branded apples are becoming a demand item with many consumers,” George Harter, CMI’s vice president of marketing, said Aug. 21.

“CMI has planned for this and has many customer programs they have created in working with their customer base.”

The News in Charts is a collection of stories from the industry complemented by charts from Agronometrics to help better tell their story.

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