The U.S. Department of Agriculture issued a correction to its Coronavirus Food Assistance Program (CFAP) July 9. Apples, initially left out of the program’s component dealing with price declines, will now be given a payment rate of 5 cents per pound.
“Many apple growers are hanging on by their fingernails, so USDA’s decision is great news and not a moment too soon,” Jim Bair, president and CEO of the U.S. Apple Association, said in a news release.
By June 1, coronavirus-related disruptions had combined with trade wars to create a record number of apples in storage — an unprecedented inventory that was “exerting tremendous downward pressure on prices received by growers.” With the 2020 harvest on the horizon and pandemic-related costs rising, growers — particularly those in the Pacific Northwest — were facing a situation that had reached “emergency levels,” according to USApple.
USApple and other industry organizations wrote USDA June 16 seeking financial aid from CFAP, a program that provides direct payments to farmers who suffered price declines or lost markets due to the coronavirus. Despite declines in apple prices caused by the pandemic, apple growers did not initially qualify for CFAP funds. To be eligible for up to $250,000 in assistance, they had to demonstrate a price loss of 5 percent or greater from mid-January to mid-April 2020. According to USDA’s original calculations, apple growers did not experience such losses.
The industry disagreed and argued that USDA’s original price determinations were flawed. Those determinations were based on USDA’s terminal sales data, even though the vast majority of apples are shipped wholesale to supermarkets. Fewer than 10 percent of apple sales occur through terminal markets, said Mark Powers, president of the Northwest Horticultural Council.
According to data from USApple and the Washington State Tree Fruit Association, actual price declines from mid-January to mid-April ranged from 6.5 percent to 24.9 percent.
With help from those data, USDA now calculates that the average price decline for apple growers was 10.9 percent, according to USApple.
—by Matt Milkovich