Who will market WA 38?

WA 38 examples on display during a Washington State University field day and workshops at Sunrise Research Orchard and labs south of Wenatchee, Wash., on Aug. 7, 2013. (TJ Mullinax/Good Fruit Grower)

When growers apply for WA 38 apple trees in a lottery this spring, they will need to know who is going to market the fruit.

WA 38 is the latest release from Washington State University’s apple breeding program. Because only a limited number of trees will be available for planting in 2017, the university will allocate the first commercial supply of WA 38 trees by lottery.

“We don’t believe that in 2017 we’ll come close to meeting demand,” Jim Moyer, director of WSU’s agricultural research center, told growers during the Washington State Horticultural Association’s annual meeting in December.

The lottery, to be held in May or June this year, will determine who gets trees and how many for the first year they’re available. It will have two divisions, one for large growers wanting, say, 15,000 or 20,000 trees, and the other for smaller growers needing perhaps 4,000 or 5,000 trees. But the exact numbers won’t be known until growers’ applications are in, Moyer said.

The number of trees allocated per grower will depend on the number of people applying.

The variety will be limited to Washington growers for at least the first ten years. All the state’s major nurseries are propagating it.

Once the lottery is conducted and the nurseries know who is going to buy the trees and which rootstocks they want, they can bud them this summer and have finished trees for planting in the spring of 2017.

“We’re not going to oversell what the nursery industry believes they can deliver,” Moyer said. In subsequent years, there should be enough trees to go around.

WSU has appointed Proprietary Variety Management of Union Gap, Washington, to collect royalties on the trees and establish a trademark for the apple. As of December, the university had not yet decided on a name.

Moyer stressed that PVM will not be involved in sales and marketing of the variety. “Growers are going to be free to work with the marketing desks they always work with, and we will license them,” he said. “Growers have relationships with their marketing desks and we respect that. Our thinking is when we do our call for applications for the lottery we’re going to ask that the applicants have a commitment from the marketing desk,” he added.

But it’s not known whether all marketers will want to handle the variety, given the large number of new apple varieties available.

“I think one of the warehouses and marketers is going to have to get behind it and go,” said Dain Craver, an organic grower at Royal City, Washington, who has a few test trees of WA 38.

Craver said there’s a break in the chain. WSU has the apple, they’re offering it to growers, but they have not lined up any marketers.

He noted that the trend has been for a warehouse to focus on a specific new variety. For example, McDougall and Sons is the U.S. licensee for Ambrosia, Stemilt Growers has Piñata, and Sage Marketing has Sonya.

“I’m a little concerned,” Craver said. “If I was WSU, I would be going to all those marketing agencies and saying, ‘Hey guys, will somebody get behind this thing and say we’re willing to grow it and pack it and market it?’ I feel there’s a gap unless a marketing agency says, ‘We like this apple and we’re going to get behind it.’”

As a state institution that has used public and grower funds to develop the variety, WSU has to make it available to any Washington grower who wants it. Yet, for marketers, exclusivity is a marketing advantage. A marketer might wonder why they should go out and spend money on marketing and advertising the variety, if a competing warehouse can come in and sell the variety after they’ve done that, Craver pointed out.

“It will be interesting to see where this whole thing takes us,” he added. “I hope it’s successful because I want our state to get some winning apples.”

Brent Milne, a member of the Cultivar Licensing Committee, which has been advising WSU on how to commercialize its new apple varieties, said some marketers will probably be eager to run with the variety, while others might wait until it becomes established with consumers. But he’s optimistic that several of the state’s large marketers will want to handle the apple.

“I think the grower is going to cast about, just as they normally would,” said Milne, who is horticulturist with McDougall and Sons, Wenatchee. “When you’re getting ready to lay down at least $25,000 or up to $35,000 per acre, depending on the tree density or training system, that’s a huge commitment and there’s a lot of risk involved.”

Milne said McDougall’s marketer, Columbia Marketing International of Wenatchee, Washington, likes to be on the front end of new, high-value cultivars.

“And I think there’ll be a percentage of outfits that are in that same mode,” he said. But there likely will be others who want to see the variety established before they jump in.

“That’s the thing about releasing a new variety—you don’t know,” Milne added. “At the end of the day, it has to be carried by how good that cultivar is. Is it a good apple to begin with? There are a lot of new cultivars out there.” Moyer said he hoped to have all the details about the application process and selection process for the lottery worked out by March. •