Raisin oversupply prompts San Joaquin Valley growers to pull thousands of acres of grapevines

By Kim Baca, The Associated Press
Wednesday June 26, 2002

FRESNO — Faced with an oversupply of raisins in the United States, federal food regulators have approved a late-season grapevine removal program in the San Joaquin Valley that supplies most of the nation’s raisins. 

Starting Tuesday, raisin farmers were allowed to prune or yank out about 8,000 acres of grapevines to help reduce the number of raisins produced and stored in the nation. 

The Raisin Administrative Committee, an organization that manages quality standards and oversupply stocks, asked the U.S. Department of Agriculture last month for the removal program after seeing projections of this year’s crop. 

About 400,000 tons of raisins are expected to be harvested through September. Last year’s crop was 373,000 tons. In 2000, raisin producers had their largest crop to date, about 433,000 tons. 

Richard Garabedian, Raisin Administrative Committee chairman, said the vine-pull program will help lower the stock of raisins and get California’s 5,000 raisin growers better prices for their product. 

“In the past two years, the prices have been so bad that a lot of farmers are losing their ranches from Bakersfield to Los Banos,” he said. “Some banks are refusing to lend ... because they are afraid they are not going to get paid back.” 

California, primarily the San Joaquin Valley, supplies most of the nation’s raisins, as well as 40 percent of the world’s raisins. 

Raisin supplies have increased in the nation due to imports from Turkey, Iran, Greece, Chile, Australia and South Africa, where labor costs are lower, said Stephen Vasquez, a farm adviser at the University of California. 

The acreage of grapes planted has remained at 280,000 for the past decade. But growers who once sold fruit to grocery stores, or the juice or wine industries, have shifted to raisins because of escalating labor and other costs. 

The vine-removal program will help growers like 80-year-old Harry Rustigian of Fowler, who makes about $540 for a ton of raisins, though it costs him an average of $800 a ton to grow them. In 2000, a grower received $1,211 a ton. 

He had hired help to work with him on his 100-acre farm until prices got so bad two years ago. 

“I remember the Depression time and we’d make enough money if we worked hard. You just can’t make it today because everything you buy is expensive and we sell the raisins very cheap,” said Rustigian, who now lives off his retirement savings. 

This season, Rustigian and other growers will be compensated by the Raisin Administrative Committee if they prune their vines by July 31. Growers will be given a bonus if they pull out the vine completely, Garabedian said. It takes a grapevine three years to produce grapes. 

While vine-pull programs are relatively common, this is the first time it has been requested and approved this late in the season, which ends in three months. 

The USDA approved the committee’s request because of declining shipments of raisins in the country in the past seven years, department spokesman George Chartier said. About 366,000 tons of raisins were shipped in the nation in 1994, compared with 295,000 tons in 2001. 

Meanwhile, growers are looking at ways to increase sales. 

Last year, the industry brought back the “Dancing Raisins,” a mid-1980s print and television ad campaign that used animated clay raisins to encourage people to eat and cook with California raisins. 

But the television campaign now appears only on the Food Network, targeting a small market, because the California Raisin Marketing Board has meager means after growers have received low prices for their product in the past two years. 

The marketing board, an organization that collects fees from growers for research and advertising, also has launched an ad campaign, “Look Who’s Cooking with Raisins,” featuring celebrity chefs. 

But despite the renewed push, the board hasn’t seen an increase in raisin shipments, said Ron Worthley, the board’s senior vice president. He said the group would like to do more advertising, but can’t afford it. 

Growers now pay $17.50 per ton of raisins to the board, because sales are so flat. When the “Dancing Raisins” were introduced on prime time in the 1980s, raisin growers paid $65 a ton.