Organic demand drives Salinas Valley production
California’s Salinas Valley has the ground and climate to feed a growing appetite for organic produce, grower-shippers say.
Costs remain a challenge, but suppliers also say there are challenges on the conventional side of production.
“The category definitely has momentum,” said John Scherpinski, sales director with Salinas, Calif.-based D’Arrigo Bros.
Interest in organics is particularly keen among retailers, Scherpinski said.
“I think there’s a lot of buy-in particularly on the retail side. We haven’t seen much interest at foodservice,” he said.
The trickiest part of the equation moving forward is the cost model, Scherpinski said.
“I think they’re really stuck on a certain model of trying to provide that product at maybe too reasonably priced on the shelf,” he said.
Organics have become more mainstream, and pressures to keep the price premium at bay are strong, Scherpinski said.
“I don’t know, but it seems like some of that competition is creating some pressure back to our end, and, frankly, it takes a little more to grow,” he said.
Pressures aside, the overall trend is to grow more organic product, Scherpinski said.
“There will be increased demand for product sourcing on organics from this area,” he said.
Organic production in the valley continues to expand to meet growing consumer demand, said Samantha Cabaluna, vice president of brand marketing and communications with Salinas-based Tanimura & Antle Inc.
“And that’s the key — demand is coming from consumers,” she said.
Cabaluna said it’s part of an “evolving food mood,” as people look for better food.
Organic produce sales can vary by demographics, income and other factors, but, in general, demand has required increased production, said Doug Classen, sales manager with Salinas-based The Nunes Co., which markets organic vegetables under the Foxy Organic brand.
“We are seeing growth in that segment, and we’re staying close to our customers in making sure we can supply them appropriately,” he said.
“Every item we grow conventionally we grow organically.”
Salinas-based Royal Rose LLC grows organic radicchio and frisee.
“We’ve been increasing about 10% a year, but finding land has been a bit of a challenge,” Gattis said, estimating Royal Rose’s organic production at about 15% of its total volume.
There are more organic strawberries in the market, said Vinnie Lopes, vice president of western sales for Naturipe Farms LLC in Salinas.
The strawberry category is very well developed to handle up to about 400,000 trays per week with fair returns to growers, he said.
“Once it gets above that mark, we are not seeing the extra level of consumption kicking in and driving support for the next higher production, and pricing is unprofitable,” he said.
The category needs to grow or supply may have to sustain, at best, or even decrease a bit in the short term to allow growers to be profitable while the category takes time to expand, Lopes said.
“For now, we have hit that mark and gone beyond for the better part of the year,” he said.
There is strong consumer demand for organic products at Salinas-based Mann Packing Co., said Jacob Shafer, marketing and communications specialist.
“As a leading organic player in produce, we think it is essential to engage this consumer-driven trend for cleaner and healthier products,” he said, noting that the company soon will have new organic items.
Organic strawberry acreage in the Watsonville-Salinas area has had a “big increase” in recent years, said Carolyn O’Donnell, communications director for the California Strawberry Commission in Watsonville.
“Between summer and fall planting, it looks about a 10% increase,” she said, with organic at 11% of overall acreage.
In the Watsonville-Salinas area, it’s 2,364 organic acres out of a combined total of 13,630.
Foodservice remains organic’s weak spot, said Tim York, president of Salinas-based Markon Cooperative Inc., which caters exclusively to foodservice clientele.
“Price is the primary reason,” he said.
