Fruit and Tree Nut Farming
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Industry Overview
The fruit and tree nut farming industry includes about 100,000 farms with combined annual revenue of $17 billion. Major US companies include Dole Food Company, almond cooperative Blue Diamond Growers, the National Grape Cooperative and its Welch's subsidiary, and citrus cooperative Florida's Natural Growers. The industry is fragmented: the top 5 percent of farms generate around 40 percent of industry revenue.
Competitive Landscape
Demand is driven by US population growth and consumer trends in food consumption. The profitability of individual companies depends on maximizing crop yield and minimizing risk of disease. Large companies and farm cooperatives have advantages in highly mechanized operations, branded food products, and access to low-cost labor. Small operations can compete effectively by specializing in agritourism as well as organic, heirloom, or unusual fruits and nuts. The industry is highly labor-intensive: average annual revenue per employee (both farm operators and workers) is less than $20,000.
The fruit and nut industry competes with grain, vegetable, and melon farming for crop acreage, as farmers tend to plant and harvest crops with the highest yield and payout.
Products, Operations & Technology
Major products include grapes (30 percent of the market) and apples, almonds, oranges, and strawberries (10 percent each). Other fruits and nuts include blueberries, walnuts, peaches, cherries, and lemons.
A farmer commits to a crop based on available acreage, topography, soil, climate, and financial considerations. Fruit and nut farmers typically concentrate on a small handful of varietals that are the most commercially viable. For apples, a total of 15 varieties account for 90 percent of all apples produced. Three main types of strawberries dominate the market: June Bearing, Day Neutral, and Everbearing. California and Arizona orange farmers specialize in navel and Valencia sold whole at retail. Florida's warm and humid weather produces a thin-skinned orange that blemishes easily; thus, most Florida oranges are processed into juice.
Most fruit and nut farms must invest either in expensive picking equipment or seasonal farm labor. Almost all fruits and berries are handpicked. Berry crops require a large pool of seasonal labor and must be harvested every one to three days to maximize yield and encourage additional fruit production. If picked correctly, an acre of strawberries can yield 10,000 pounds of fruit.
The method of picking oranges hasn't changed much since the first grove was planted in Florida 300 years ago: workers handpick fruit from the lower branches and scale ladders up to 18 feet high, collecting the fruit into shoulder bags and filling large field tubs. Field workers can pick around 800 pounds of processed oranges an hour. Specially designed orange farm tractors, called "goats," transfer field tubs of oranges to truck trailers waiting at the edge of the field.
Mechanical tree "shakers" rustle the base of an almond tree, causing the shell to fall to the ground. The nuts dry on the ground, are swept into rows and picked up by machine.
With the exception of berries, fruit and nut trees typically require a long grow time before the first harvest. Almonds need at least seven years to grow from a sapling to a nut-producing tree. Navel oranges are seedless and sterile; the only way to produce new fruit is to graft cuttings onto other varieties of well-established citrus root stock. Grafted branches require at least five years before they start producing fruit.
Because of the long time to harvest, crop rotation is much less common in fruit and nut farming than with most other types of agriculture. Only around 2 percent of fruit and nut farming revenue comes from farming other products. Tearing up a crop is a last resort, typically a result of disease, lack of profitability, or poor yield due to age.
Common inputs include irrigation systems, seed and root stock, chemicals for weed control, fuel, electricity, farm supplies, machinery, and crop nutrients. Operator labor is a significant input, although nearly half of all fruit and nut farms are run by an operator whose primary profession isn't farming.
Recent technological advances include plant hybridization, genetic modification, crop irrigation, and mechanical harvesters. Some fruits hybridize easily, and farmers regularly experiment with new hybrids and genetically modified fruit that are cold- and heat-tolerant, uniform, and more flavorful. Automated irrigation helps ensure the optimal moisture of plants, trees, and fruit. Mechanical harvesters can improve a farm's yield and reduce dependence on seasonal labor.