B.C. growers propose apple agency

Kirpal Boparai, president of the B.C. Fruit Growers’ Association, says his priority is to get money into growers’ pockets.

Terry Edwards

British Columbia, Canada, apple growers took an initial step towards establishing a national apple and promotion agency, and potential future regulated marketing, at the B.C. Fruit Growers’ Association’s annual convention in Kelowna in January.

Delegates at the convention voted to support the first phase of the program, a provincial Apple Research and Promotion Agency. Delegates also approved a plebiscite requiring 65 percent of growers registered with the ­association to vote by March 8 in favor of the agency.

“What has been proposed by the BCFGA is the establishment of a provincial research and promotion agency that would act solely as a granting agency for both research and promotional/marketing activities,” past president Joe Sardinha said in his executive report to growers at the convention.

Council

A new ARPA council would include up to three apple growers (one of whom must be an organic grower), as well as one or two members at large, one member from the Pacific Agri-Food Research Centre in Summerland, British Columbia, and a representative of the Canadian government.

The council would not undertake projects, but would fund projects for the Okanagan Tree Fruits Cooperative, BCFGA, or other industry groups.

The proposal has a potential to raise $1.4 million for apple promotion and research, funds raised by a levy on apple producers of up to .09 cents a pound for fresh apples and .02 cents a pound for processed fruit.

The levy would be collected at the first point of sale of fruit, typically the packing house, but could also be another sales agency or a retail outlet. Packing houses and processors would be responsible for reporting, collecting, and forwarding the levies, but growers selling direct to retail or wholesale outlets or processors would have to pay the levy directly to the council.

The provincial ARPA would be a small organization whose function would be to get research and development funds provided by growers into the hands of those individuals and organizations best able to fulfill industry strategic priorities in research and development. Its board of directors would organize priority-setting ­sessions and adjudicate applications for research and promotion activities.

Coordinated approach

The short-term benefit of the agency would be to move the industry forward in a coordinated rather than a splintered approach to research and marketing. It would also be a method of maintaining a comprehensive grower registry with the ability to levy all producers for well-defined purposes.

“Currently, Ontario, Quebec, and New Brunswick have such systems in place,” Sardinha said. Growers in Nova Scotia likely would follow suit if B.C. growers approve this step.

The long-term objective, Sardinha said, is to pursue the concept of regulated marketing as a means to secure market protection.

“As a first step, before regulated marketing can be considered, the industry must demonstrate there is a system of discipline within the province,” he said.

“If the tree fruit industry supports the concept and is successful in its implementation, there exists an opportunity to form a national research and promotion agency with the other apple-producing provinces. Those provinces have already expressed strong support for a national agency.

“At this stage, the national apple industry could undertake to implement a system of levy collection on imported apples. This would double the funding currently collected in each region, generating considerable new funding for apple research and promotion.”

However, Sardinha cautioned that the road to regulated marketing and trade protection would not be easy.

“The federal government has been pursuing free trade agreements with Korea, Latin America, and other countries in the Asia Pacific region. These trade liberalization talks, aimed at increasing Canadian access to new markets, may ultimately require concessions from existing supply-managed sectors that will compromise their existing high-tariff trade protection.”

The idea for the B.C. ARPA came out of the Apple Working Group of the Canadian Horticulture Council. The levy would have to be authorized by the provincial cabinet under the provincial Farming and Fishing Industry Development Act. Its mandate would then have to be renewed every five years by a vote.

Balloting for BCFGA members will be conducted by mail and will wrap up at the annual Horticulture Forum in Kelowna March 1-2.

Columbia River Treaty

The outgoing president stressed focusing on the positive in his final report at the convention, but it’s a message that orchardists are finding difficult to embrace.

“The past three years, while more profitable for cherries and other tree fruits, have been most challenging for the apple industry,” Sardinha, who stepped down after seven years as president, said in his executive report.

Average returns to growers for apples for the crop years 2008, 2009, and 2010 were 15.3 cents per pound, while the cost of production is estimated at 22.6 cents per pound. The global economic slowdown and rise in the value of the Canadian dollar are considered the primary causes of the low returns.

It was suggested in a Tree Fruit Industry Task Force report submitted to the province by the BCFGA last year that the province should support agriculture sectors impacted by the Columbia River Treaty. The treaty, signed in 1964, controls water flow of the Columbia River from British Columbia to Washington State’s Columbia Basin and resulted in a massive expansion of tree fruit and vegetable production in Washington. Since 2014 is the first date that a ten-year notice to cancel or change the treaty can be issued, the province has initiated a review process to study the treaty’s possible continuation, renegotiation, or termination.

In a report to the BCFGA from its Select Standing Committee on Finance and Government Services, its authors state that the tree fruit sector has a claim on Columbia River Treaty funds.

“Our sector has been pummeled by the overproduction of apples in Washington State,” the report states. “Since the regular supply of irrigation water was made possible by the Columbia River Treaty in 1964, the Washington State apple industry has grown from the same size to 25 times the size of the B.C. tree fruit industry.”

The BCFGA suggests that $9.25 million of the total annual treaty funds ($200 million to $300 million) be invested in the tree fruit, potato, and vegetable sectors affected by the treaty.

Kirpal Boparai, newly elected president of the association, said his first priority is to get money into the pockets of growers any way he can.

“The growers are working very hard, and the last few years, the funds haven’t been there. I want to make sure I do some research and see how we get those funds.

“We’re seeing production go up, but the prices in the last few years have been drastically bad. I want to help the ­growers.”

In a reflection of tough economic times, the association’s budget showed a loss of $38,215 last year and is projecting a $17,800 loss this year. The president’s annual honorarium was halved from $20,000 to $10,000.

The BCFGA represents 760 family-operated farms that provide $300 million in economic activity.