Raisin growers see mixed outlook as harvest peaks


Issue Date: September 9, 2009
Dennis Pollock

Dennis Oikle checks raisin grapes at his Fresno County vineyard. Yields have been down this year for most raisin growers and there is concern that prices may be lower as well.

"I'm happy," said Dennis Oikle as he watched workers pick grapes from his vines in Raisin City and put them on paper where they will dry in the San Joaquin Valley sun.

He's happy because, relatively speaking, his yields are shaping up better than some he's heard about. In a year in which raisin grape varieties are off about 16 percent from last year, Oikle says he's getting three to three and a half trays from each vine in his 70-year-old vineyard, while some other growers say they're getting just over a single tray.

But there's one thing that Oikle—along with many others in the raisin business—is not smiling about. Wineries in recent days announced they will buy green grapes for concentrate at $165 a ton this year, down from last year's $225.

"That price is a disaster for the raisin grower this year," Oikle said. He and others believe it could result in growers of raisin variety grapes choosing to make raisins rather than selling their green grapes to the wineries.

Nat DiBuduo, president of the Fresno-based Allied Grape Growers, said "the discouraging part about this is the lower production along with the lower prices per ton."

But, he said, a lot of his members would sell green grapes to the wineries anyway.

"They're not happy, but they've decided to take it on the chin," he said.

DiBuduo said the lower price may have been generated in part by competition from apple concentrate out of China and "the perception that there were a lot of raisin guys who wanted to go green."

Now, the lower price could have an adverse effect on growers who sell in two different markets, for concentrate or for raisins.

The amount of raisins delivered this year will have a direct effect on how much farmers are paid. Glen Goto, CEO of the Raisin Bargaining Association in Fresno, explained that growers are paid on a sliding scale based on volume.

Some raisins will go into a reserve to fund an export program, and in October growers will learn the formula for their compensation. Trade demand has already been set at about 235,000 tons, Goto said.

He said the field price per ton could range between $1,273 and $1,373, depending on a crop ranging from 280,000 to 320,000 tons.

"Our deliveries for last year's crop were about 365,000 tons and we sold 335,000 tons," Goto said. "We're coming off a tight year for inventories."

Gary Schulz, president and general manager of the Raisin Administrative Committee and California Raisin Marketing Board, said the supply-and-demand picture for raisins is considerably improved over recent years "when we had to send raisins to cattle feedlots" due to excess production.

He said demand for raisins remains strong despite the nation's economic challenges.

"Our price point has been relatively low and we're able to hold our market share, especially domestically," Schulz said. "In export, it's more competitive, because of producers who have proximity to Europe. But export shipments were only off 12 percent from a record of 142,000 tons two years ago. That's quite an accomplishment, given the world economic situation."

Rick Stark, grower relations manager for Sun-Maid Growers in Kingsburg, said this year's crop appears to be shaping up to be like the 2007 crop, "around 330,000 tons, give or take 10 percent each way."

"But you can't predict Mother Nature," he added.

There have been challenges to the crop, said Stephen Vasquez, University of California viticulture farm advisor for Fresno County, including "bad powdery mildew."

Vasquez and growers say this year's crop has better quality and is developing sugar content quicker than the 2008 crop.

Schulz and others said labor shortages, a perennial problem, are not an issue this year. Some, including Oikle, said a reason for that is availability of workers who have been pushed out of jobs by agricultural water shortages on the west side of the San Joaquin Valley. Because raisin production is concentrated within 50 miles of Fresno, on the valley's east side, Schulz said water availability has not been an issue for most raisin grape farmers.

In addition, some employees have moved back to farm jobs due to cutbacks in construction and other industries as a result of the recession.

Vasquez said as much as half the raisin crop is now harvested mechanically, with use of continuous tray machines most popular. The machines drop loose grapes onto a paper tray behind the machines.

Kerman grower Kuldip "Cal" Kaleka is among those who has turned to use of the continuous tray machinery, purchasing a machine for $250,000.

"They dry faster this way," he said, "with just one or two layers of grapes on the paper" rather than the bunches that workers hand-cut and place on individual paper trays.

"Four people on the machine do the work of 20 people," Kaleka said. "It's a neat and clean operation. Labor had become a pain in the neck."

Not everyone is enamored with machine harvesting. Oikle said a procedure he used involved cutting canes, and some workers failed to cut the correct canes.

Easton grower Dwayne Cardoza said the DOVine variety of grape "has a lot of elasticity and the grape doesn't come off that easily."

"We had to turn the heads up on the machine, and it was like playing ping pong," he said. "There were raisins going 20 feet in the air. It was like hitting a baseball out of the park."

The Thompson seedless grape, the variety Oikle is harvesting, has been a raisin mainstay. But Cardoza said he is turning his back on that variety because it is usually harvested late in the summer, making it vulnerable to damage from rains.

Cardoza, who had about 175 acres of Thompsons, now has Selma Pete, DOVine and Fiesta varieties, along with zante currants. His Thompson acreage has dropped to seven acres that he plans to remove after this year's harvest.

(Dennis Pollock is a reporter in Fresno. He may be reached at agcompollock@yahoo.com.)

Permission for use is granted, however, credit must be made to the California Farm Bureau Federation when reprinting this item.