Raisin growers may be getting more money for their crops.
On Tuesday, the Raisin Bargaining Association, an advocacy group based out of Fresno, met to come up with a new sliding scale pricing basis for their respective packers in order to quell cost uncertainties that are associated with crop size. For example, if the deliveries are less than 300,00 tons, they will be priced at $2,000. However, if deliveries are more than 350,000, growers can expect $1,700 for their crops.
“The RBA Board felt this is to be a fair method to determine the true value of this year's harvest,” said Glen Goto, RBA's chief executive officer. “It just makes logical sense.”
The signatory packers have until next Tuesday to accept the new scale. If they don't, the RBA will expect a counter proposal in the near future.
Following low prices in the early 2000s, U.S. grower prices for raisins have held strong prices, averaging $1,940 per ton (dried basis) in 2012. Prices averaged $1,660 per ton in 2011, up from $1,510 the previous year, which was the highest since 2004.
If the new scale is accepted, growers would be a setting a new record high for the crop.
Goto also stated that although prices have gotten better for California raisin growers, more and more farmers are opting to switching to more profitable crops like walnuts and almonds. Since 2008, raisin production has dropped three to five percent annually and total acreage dedicated to raisins has dropped by 33 percent over the last decade.
“We’re seeing growers deciding to convert to more profitable crops, especially the nuts,” said Goto. “People are continuing to just pull out their vines.”
Despite suffering blistering temperatures and noticeable pest damage, this year’s grape production for raisins is expected to reach 2.40 million tons, a 25.5 percent increase from last year, according to the National Agricultural Statistics Service.
Goto stated the actual production numbers are more like 10 to 15 percent more than last year.