Peter Truitt said his company’s decision was motivated by a desire to see consolidation of the industry to make it more prosperous for processors and growers.
After almost 40 years as a major pear canner, Truitt Brothers of Salem, Oregon, is “bowing out” of the business in order to help the industry consolidate.
The company is no longer processing pears, and its 50 growers will instead take their fruit to Northwest Packing Company (part of the Neil Jones Company) in Vancouver, Washington, starting with the 2012 crop, according to Peter Truitt, who runs the company with his brother David.
Truitt Brothers had hoped to acquire the business of Snokist Growers, Inc., in Yakima, Washington, which has gone through bankruptcy proceedings. Truitt made an offer to the U.S. Bankruptcy Court of $42.5 million, which was built around satisfying the creditors as far as possible.
However, Truitt Brothers was unable to put together a financing package by the court’s deadline. In early May, the court approved the sale of Snokist’s assets to Del Monte Foods of San Francisco, California, and Pacific Coast Producers of Lodi, California, for $27.8 million. Pears were just part of Snokist’s fruit canning business, along with apples, cherries, prunes, and peaches. The purchasers are not expected to keep the pear operation running, which means that Snokist’s growers will be looking for other places to process their pears.
Twenty years ago, Washington and Oregon produced about 200,000 tons of Bartlett pears for processing. The volume has been gradually declining and has averaged between 120,000 and 130,000 tons in recent years. Meanwhile, cannery capacity has not changed. Snokist, which was the largest pear cannery in the country with a capacity of 60,000 tons, was only processing about half that tonnage.
For the 2011 season, Truitt Brothers had its growers’ pears, as well as cherries, co-packed by Del Monte Foods in Washington, but the pears were still sold by Truitt Brothers under their own label. Truitt said it made more sense to can the pears in the region where most of them were grown and avoid the cost of transporting them to Oregon.
Had Truitt Brothers been successful in its bid, it would have processed Snokist’s 30,000 tons of pears and its own 22,000 tons, bringing the Snokist plant almost up to capacity and reducing the per-unit costs, Truitt said.
“We felt that would be the ideal place for us to process our pears and, more importantly, to provide a platform for industry consolidation,” he said. “We’ve been motivated from day one to help the industry achieve a consolidation that would enable the remaining processors in the industry to be prosperous.”
Truitt Brothers and Snokist’s exit from the canned pear business leaves just three remaining processors: Del Monte, Independent Foods in Yakima, and Northwest Packing. Truitt Brothers has no immediate plans for its vacant pear plant, though it could provide room for growth of canned bean production.
Truitt Brothers has been focused on helping its pear growers transition to Northwest Packing. In addition, its sales team will be working with Northwest on the marketing end for the next few months.
“Our intent is to bow out with dignity and decency and to try to facilitate the most seamless consolidation that we possibly can,” Truitt said. “I think things are going to be chaotic over the next few months, but with this consolidation, things will definitely stabilize, and prosperity will return to the industry.”