Cling peach grower Randy Fiorini holds bright prospects for his crop this year. Dimmer, however, is the outlook for the California industry's ability to compete with subsidized, imported canned peaches from Greece, a sore spot for him and the other 700 cling growers in the state.
Fiorini farms 400 acres of cling peaches at Delhi. The property includes the land originally homesteaded as a dairy by his grandfather in 1909.
His family's experience with cling peaches dates back to the 1920s in the days of the Halford variety, the last of their blocks remaining until 1978. Today Fiorini has 16 varieties of clings for a ripening span from July 4 through Labor Day.
As of mid-April, prospects for the 2001 cling set were excellent, although some individual, random orchards suffered hail and frost damage. Most varieties appeared to be on the way to typical production.
The state has been stable for several years at about 30,000 acres, ranging from Yuba City to Kingsburg but concentrated in the Yuba City and Modesto districts. California production in 2000 was 500,000 tons, about the average for the past several years.
Fiorini's history, combined with his own expertise and leadership developed in farming the past 25 years, makes him a logical choice as chairman of the California Cling Peach Board.
Composed solely of growers, the board is the state marketing order that handles research, promotion, and trade policy issues for the crop. Established in 1996, the order has been renewed twice since, most recently in March of this year. Fiorini has been chairman since 1996.
He was to testify April 26 before the International Trade Commission in Washington, D.C., at a special hearing called to investigate European Union subsidies. Shortly before, he shared with Western Farm Press the issues he planned to carry to the commission.
Lost export markets
“Because of the unfair subsidy schemes provided by the EU to the Greek peach industry, California has lost nearly every export market in the world and we are now seeing a rapid increase in imports of Greek peaches here in the U.S., particularly on the east coast,” he said.
Although no cling peaches were produced in Greece before 1972, Fiorini said today they are that nation's major crop, with imports to the U.S. expected to exceed two million cases this year.
When Greece joined the EU, it became eligible for subsidies, which dramatically increased planting there. Fiorini said the amount and method of subsidies varies from year to year, but “it is fair to say they receive monies in excess of our raw product value. That means the subsidy can be more than the $225 a ton we might receive from processors. We've been fighting the subsidy issue for the past 15 years with very little success.”
The rate of exchange between the U.S. dollar and Greek and other currencies compounds the problem.
He said the cling industry and other groups have sent collation letters to the leadership of previous administrations, and although the problem was universally acknowledged, no action was taken.
Will the appointment of Ann Veneman, a native of nearby Modesto, as U.S. Secretary of Agriculture have bearing on the question?
“We can only hope,” Fiorini said, “that this issue will become a higher priority at USDA, but it's too early to tell since she is still in the process of naming under-secretaries.
“But on a greater scale, this is not just a California-Greece issue. It's really an issue many U.S. commodities have with domestic subsidies of the EU. It affects olives, tomatoes, pears, the meat industries, and many others.
“Hopefully, USDA and the U.S. Trade Representative's Office will look at these subsidies and determine that they, in fact, distort trade and are unfair, and then do something about them. Ultimately, a case would have to be brought before the World Trade Organization.”
Part of the lack of action, he said, may be the cases for beef hormones and bananas. Even though won by the U.S., they have received no remedies or reforms. Until they are settled, U.S. officials may be reluctant to pursue additional cases until the effectiveness of the WTO is demonstrated.
Meanwhile, it would seem the growers are on their own in an economy that pays little attention to product origin, shops for price, and is willing to overlook waste associated with the Greek product.
For example, Fiorini said, local stores of a retail chain near him were selling Greek peaches. When asked why, the company president replied they didn't realize the origin of the packed fruit and promised to stop stocking them.
In another instance, when Fiorni toured a grocery distributor's facilities in the eastern U.S. and found Greek-origin peaches, the distributor said no one told him they were imports.
“Here's the problem,” Fiorini said, “in Eastern Canada our California product costs about $20 a case, vs. about $10 a case for the Greek product.
May boost promotion
“A processor in Mexico once processed California clings but then shut down his plant when he found he could buy Greek product at $6 a case less than it cost him to can California fruit. It was a business decision: he could make more money importing clings than running his own cannery.”
Against such obstacles, the board is considering boosting promotion for the domestic market, Fiorini said. “We believe we have a high quality product, in keeping with a healthy diet, consistent, and available year-round.
“California canned peaches are as nutritious as fresh peaches, and in some cases better. We need to re-energize consumer interest. Really, the domestic market is all we have left.”
The U.S. is an 18-million-case market, and in the past imports ranged annually from none to 750,000 cases, so the spike in Greek imports is significant.
The subsidies have caused overplanting of clings in Greece, leading to massive dumping of surplus raw fruit. Fiorini has photographs of massive tonnages of discarded fruit in what the EU calls a “withdrawal program.”
“You can see how distorting it is when a country is producing twice as much as it can process. Ordinarily weather can act to even things out over time, but in the case of Greece, even with weather events, they still have enough to pack a full crop.”