The almost exclusive winter marketing window that Florida growers enjoyed in the past is coming to an end as Mexican growers expand production and increasingly affect demand and prices.
Growing on twice as many acres as Florida, Mexican strawberry growers have significantly increased shipments to the U.S. and are expected to double acreage within the next five years, said Zhengfei Guan, a University of Florida assistant professor with the Institute of Food and Agricultural Sciences’ Gulf Coast Research and Education Center in Wimauma.
The state of Florida’s strawberry industry bears a striking resemblance to the position Florida’s tomato growers found themselves in during the mid- to late 1990s, said Guan, who is studying the industry and plans to submit findings to an academic journal.
Mexican strawberry acreage has increased from an average 14,000 to 16,000 acres in 2000-10 to around 21,000 acres in 2012 with exports jumping from 70 thousand to 75 thousand metric tons during the first decade of the 2000s to 115 thousand metric tons in 2011.
U.S. imports of strawberries during the same time steadily increased from around 70 million pounds to 235 million pounds in 2011, according to information Guan cited from the Food and Agriculture Organization, the U.S. Census Bureau and the U.S. Department of Commerce.
That led, in part, to a drop Florida’s market value and market share, Guan said.
The value of Florida’s strawberries tumbled from $366 million in 2010-11 to $201 million in 2011-12 and below the $298 million 2008-12 average, according to the U.S. Department of Agriculture.
In surveys of growers accounting for more than 50% of Florida’s acreage, Guan said he finds an industry pessimistic about the future. Up to two-thirds of the growers he surveyed state they think the industry will decline in the next few years.
The 2011-12 season was disastrous and the 2012-13 season would have been as well if not for weather problems that hurt Mexican production, he said. If this season is another bad one, the growers Guan surveyed told him 60% of the industry would likely be out of business.
“The strawberry industry has realized things have changed but they don’t quite know what to do with it,” Guan said.
“A lot of things are out of their control like labor and government regulations. The strawberry and tomato industries need to innovate and change and grow new and better varieties and find cost-effective labor solutions.”
Though some look to a suspension agreement (which sets floor prices on imports), Guan says Florida’s strawberry sector is much smaller than Florida’s tomato industry and is dwarfed by California’s berry production.
As many grower-shippers in both states are invested in Mexican production, a dumping lawsuit wouldn’t be likely, he and others said.
Mexican tomatoes are imported through a suspension agreement, first put in place in 1996 to halt a dumping investigation.
Rather than going the lawsuit route, the Dover-based Florida Strawberry Growers Association is fortifying production and marketing and studying competition.
Florida growers are examining the vulnerabilities of their competitors as well as their own and seeing what they can do better, said Ted Campbell, executive director.
He said any competitive advantage is transient and that Florida’s growers need to pay attention to the challenge and improve varieties.
“Mexico is a valid competitor and is doing what any competitor should do and they’re pretty good at it,” Campbell said.
“We have to make sure we are minding our business correctly so we can remain competitive. Competition can either kill you or make you a lot better.”
One solution is to drive more demand to accept increasing world production and start building consumer recognition for Florida’s fruit.
During a July lunch with Florida Gov. Rick Scott, the governor asked Campbell to name the five things that make Florida strawberry growers better than anyone else.
Campbell said he likes that business logic and said any business is in trouble if it can’t list its competitive advantages.
Why should the consumer care? And what makes Florida berries different?
Those are questions Florida’s strawberry industry needs to tackle.
Because growers ship in a commodity world, the work will be in getting consumers to recognize those advantages.
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