B.C. develops strategies for future success
In response to increasing competition and lower returns, the B.C. tree fruit industry is developing a long-term strategic plan.
The British Columbia, Canada, tree fruit industry has hired a consultant to help producers position themselves to take advantage of changing industry conditions. As a first step, consultant Bryan Kingsfield with Ference Weicker and Company Limited, Vancouver, has developed a profile of the B.C. tree fruit industry and competing industries, such as Ontario, Washington, Oregon, California, and New Zealand.
British Columbia has 18,000 acres of tree fruits, of which 69 percent are apples, 15 percent cherries, 7 percent peaches, and 4 percent pears. It has 1,800 growers, of which between 400 and 500 are considered large, commercial growers.
The province produces 30 percent of Canada’s apple crop, but less than 3 percent of the combined Canadian and U.S. apple production.
Since the 1970s, farm-gate receipts for tree fruits have risen by less than the rate of inflation, Kingsfield reports. Although apples are the largest tree fruit crop in British Columbia, acreage shrank from 21,613 acres in 1971 to 12,800 acres in 2005. Production of other fruits has also declined. During the same period, pear production has dropped by 80 percent, prune/plum production by 72 percent, and peach production by 44 percent.
Key issues that are affecting the B.C. tree fruit industry and others include:
• Increasing world production. In the last 15 years, China’s production has increased sixfold, Poland’s has increased threefold, and Brazil’s has doubled.
• Difficulty accessing European markets because of competition from Poland.
• Declining demand for fresh apples. Per capita consumption in North America fell from 8.1 pounds in 1991 to 6.8 pounds in 2005. Only in China is consumption rising.
• Lower returns as production increases outpace demand.
• Urbanization, which is raising land prices and increasing demand for water.
• Consolidation among producers and buyers.
• Scarcity of land, water, and labor.
Based on interviews with people in the B.C. tree fruit industry, Kingsfield has identified the following potential strategies for the future:
• Improve product quality by providing incentives to growers to pick on time, enhancing grade standards, and introducing technology to measure the internal quality of fruit.
• Change the industry structure with more consolidation and integration. This might mean appointing a single board and CEO to make industry decisions.
• Increase the labor supply by providing more housing, recruiting vacationers, and modifying Canada’s seasonal agricultural worker program.
• Give growers more market, business, and technical information by re-establishing extension services and providing conferences and on-line information sources.
• Increase productivity while lowering costs by boosting funding for research, improving technology transfer, and seeking tax cuts.
• Promote organic production in response to increasing market demand by providing assistance and tax incentives to growers who convert to organic.
• Develop and commercialize new varieties and seek partnerships with others developing new cultivars.
• Increase consumption of local tree fruits in British Columbia by developing marketing and promotion campaigns and funding a healthy school snack program.
In the next phase of the project, Kingsfield will consult with tree fruit industry groups to define specific strategies to address key issues. Finally, a strategic plan will be developed.
Commissioned by the British Columbia Fruit Growers’ Association, the project is also supported financially by the B.C. Ministry of Agriculture and Lands.