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Cranberry marketing order change requested

Nov. 25, 2013 | 0 comments

MADISON

Just in time for the holidays that most typify the use of its red, tart berry, the state's cranberry industry has appealed to state officials for a way to increase research and promotion dollars.

Tom Lochner, executive director of the Wisconsin State Cranberry Growers Association, told members of the policy board for the Wisconsin Department of Agriculture, Trade and Consumer Protection that the industry collects 10 cents per barrel of cranberries produced in the state.

That checkoff assessment was set in 1983 and hasn't been changed since. A barrel is 100 pounds of cranberries.

Like other marketing orders, this one exists to maintain and expand the sale of its key product and funds collected through the assessment are used by the marketing order board for research and development, industrial research and educational programs.

While the research and promotion fund has been somewhat static, the industry has grown and there have been increased demands for research and promotion, he said.

The change in the state's cranberry marketing order, which is administered through DATCP, will give the state's Cranberry Marketing Order Board more flexibility to increase the checkoff rate in the future.

Lochner noted that the change is a long-term proposition with 24-36 months required to get the amendment in place. He said the group foresees a gradual increase in the assessment rate.

A scope statement is the first step in the state rules process. The ag board will have two further opportunities to look at this proposal before it is instituted — at the draft rule and final rule status. The department will also prepare an economic impact analysis of the rule change before the rule goes out for public hearings.

Wisconsin has 21,000 acres of cranberry vines, which is up from 15,000 acres in 1989. But that only tells part of the story of growth. Production per acre was 130 barrels back then and is up to 290 barrels per acre now.

The industry has a $330 million economic impact in the state and is responsible for 3,500 jobs, Lochner said.

There are 250 cranberry growers in the state on 275 farms. This year those growers produced 60 percent of the nation's crop, growing 550 million pounds, which was up 10 percent from an August crop projection report.

Noel Favia, who handles the work with all agricultural marketing orders at DATCP, said the cranberry industry did a great job of holding industry hearings prior to asking for the scope statement that would be the first step in changing the current rules for their assessment.

Change assessment

They provided information on why it was needed and the consequences of both making the change and in not making the change.

"The new rule will change their ability to raise the assessment at some point," she said, though the rule change doesn't raise the assessment automatically.

The ag board did approve the scope statement modifying ATCP 142, which would increase the maximum amount the Cranberry Marketing Order Board may assess growers.

The cranberry marketing board asked the department for the change in September because they feel it's going to be necessary to maintain and expand the market for cranberries and fund new medical research on the health values of the tart, red berry.

"They have done an excellent job of looking ahead to the future," said Secretary Ben Brancel.

By early summer or late fall next year the industry will have a referendum vote on the proposed change.

Nicole Hansen, a member of the department's policy board who manages a large cranberry operation, said there is good support for the change in the marketing order, even among growers who sell their berries on the commodity side.

There are sustainability issues that need research as well as medical research and general crop production studies that could benefit from a greater research and promotion fund, she said.

Though there is no commodity trading mechanism for cranberries, some growers produce their crop for what is called the commodity market and this year those growers are getting about $10 a barrel.

Members of the Ocean Spray cooperative get $50 a barrel and some other value-added producers are getting prices a little bit higher than that, the cranberry industry experts explained to the ag board.

There is a federal cranberry marketing order program serving to promote the orderly and efficient marketing of cranberries in the United States. Favia explained that the state and federal programs are complementary and the state program works in close coordination with the federal program.

Favia said the department is not aware of any pending proposals to change the federal cranberry marketing program.

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