Developing the organic market
Organic cherries give retailers an opportunity to differentiate themselves.
Stemilt Growers, Inc., Wenatchee, Washington, plans to become a bigger player in the organic tree fruit deal and is increasing its acreage of organic cherries.
The company has announced that it is working towards having 25 percent of all its fruit certified organic—double the current percentage.
Marketing Director Roger Pepperl said production of organic cherries is likely to grow industrywide. He estimates that the Pacific Northwest will produce 2.75 million boxes of organic cherries this season, out of the estimated total crop of around 15 million boxes. Within a few years, as production of both conventional and organic cherries increases, organic could account for 5 million cartons out of a total production of 20 million boxes in the region, he believes.
Stemilt is converting cherry orchards to organic both in California, to target the early market, and on Stemilt Hill near Wenatchee, to target the late market in August. Pepperl said some of the late organic cherries from Stemilt Hill might be the only cherries of any kind available at that time.
He sees the market for organic cherries as underdeveloped, and immature. "You can't have a market for something you don't have. Even though there have been organic cherries—we have had them for the past three years and so have a number of other people—it's really something that's going to grow to a new level.
"What we had before was enough for the people who really, really wanted them," he said. "Now, we have to develop a market."
Number one in produce
Pepperl believes there's a select group of U.S. retailers, in addition to the specialized organic stores, who would be interested in organic cherries. Some big retail chains are already taking organic cherries because they have a full organic program. Organic cherries are a way for retailers to differentiate themselves in the marketplace by offering the very best cherries, Pepperl said.
"Retailers are going to have to differentiate themselves more and more as time goes on, and cherries are the number-one item in the produce department per ring [in sales dollars], so retailers are going to focus on trying to maximize that opportunity."
For the producer, there is some opportunity of earning a premium over conventional prices, Pepperl said. However, increasing production of cherries overall from recent plantings could put a downward pressure on cherry pricing, unless the industry is successful in raising quality and increasing demand. "If we don't get demand higher, the price will come down on conventional cherries," he said.
Because it takes three years to transition an orchard from conventional to certified organic, producers will have a significant volume of transitional cherries to market in the next few years. Stemilt has developed a new label called Artisan Naturals for its transitional fruit.
"We picked the name Artisan Natural because we were trying to get our arms around the feeling that there was care that went into growing these products and that should be reflected in the eating experience," Pepperl explained.
He believes some consumers may not be concerned about cherries being certified organic, or may not even understand what transitional means.
"I think certification is critical for the trade, but not critical for the consumer," he said. "I think they're going to want to know it's naturally farmed."