A Northwest pear processor is breaking with tradition by declining to pay growers a collectively negotiated price, adding more uncertainty to an already beleaguered industry.
The Neil Jones Food Co. of Vancouver, Washington, turned down a price offer of $335 per ton from the Washington-Oregon Canning Pear Association. The Yakima, Washington-based group typically negotiates a collective processing price on behalf of roughly 350 Bartlett pear growers, according to an industry newsletter released today.
Historically, the association starts with the largest canner, Del Monte Foods in Yakima, while Neil Jones and Seneca Foods of Sunnyside, the third canner, follow suit at the same price in separate negotiations.
This year, Del Monte and the growers’ association agreed to a price of $335 per ton, down from last year. Last week, Neil Jones told the growers that it did not agree to that price and was evaluating the overall market.
“At the time of this letter, it is not clear whether NJFC intends to negotiate with growers individually,” said B.J. Thurlby, president of the Canning Pear Association, in a grower newsletter.
Matt Jones, CEO of Neil Jones, did not return phone messages or emails from Good Fruit Grower.
The Northwest pear industry was already on shaky ground after Seneca, based in Marion, New York, announced in late April it would close down its Sunnyside plant come fall. The canner had planned to honor existing agreements with growers, CFO Tim Benjamin said at the time, but many contracts were due for renewal in May, leaving a lot of pears still unspoken for.
Meanwhile, Del Monte plans to purchase and process only what it can sell. In 2018, Del Monte canned 55,000 tons of Bartletts, Neil Jones 28,000 tons and Seneca 17,000.
If Neil Jones doesn’t buy pears at its usual volume, that puts nearly half the region’s canning pears at risk, Thurlby said. “There’s going to be some fruit out there that is not going to have a home.”
The industry has seen prices dropping for years as consumers’ taste switches from canned to fresh goods overall, and Chinese imports — even after recent tariff increases — have flooded the market with canned pears at prices below the cost of domestic production.
This year’s timing makes things worse, Thurlby said. Had growers learned of Seneca’s and Neil Jones’ decisions during the winter, they may have pruned, thinned or planned differently. Or, they may have just ripped up their trees, some of which have been producing fruit for 50, 60 or more years.
Many growers will likely turn to that next year, said Adam McCarthy, manager and owner of McCarthy Family Farm in Hood River, Oregon.
“Next year is going to be the year you’re going to see some orchards coming out,” he said.
McCarthy hopes growers use the $335 per ton price from Del Monte as a floor if they negotiate individually with Neil Jones, he said.
The contraction of the canned pear market has driven more fruit to the fresh pack industry, said McCarthy, also chair of the Canning Pear Association. Last year, for the first time, growers delivered more Bartletts to packers for the fresh market than to canners.
But prices were also pressed downward there last year, he said. “The fresh market is pretty well strapped and had a challenging year last year.”
—by Ross Courtney
Editor’s Note: The story has been corrected to reflect that the association negotiates with Neil Jones every year.