In the face of declining commercial apple prices, numerous Midwestern growers are exploring alternative sales avenues to enhance profitability. Among these strategies, transitioning to certified organic production and increasing direct retail sales have emerged as prominent alternatives. A spotlight on Michigan reveals that Kyle Rasch and Tom Rasch of Third Leaf Farm have opted to convert their conventional apple orchards to certified organic operations. This decision was catalyzed by the unsatisfactory prices fetched by conventional apples, prompting the transition of their remaining 70 acres to organic, with the expectation that these apples will enter the organic market by 2026.
The transition to organic not only aims to capture better market prices but also streamlines horticultural management by unifying their farming practices under a single system. The organic sector's growth and the opportunities it presents have been encouraging for the Rasch family, marking this season as the first where their organic produce meets market demand. This shift is not isolated, as other Michigan growers are similarly transitioning acreage to organic, driven by the potential for higher returns in both fresh and processed apple markets. Some processors are already engaging with certified organic apples, while others await increased volume.
Direct retail strategies are also being adopted, as exemplified by the Illinois farm market Eckert's, which is reducing its reliance on wholesale by removing approximately 30 acres of older, semidwarf trees. This move is part of a broader strategy to concentrate on direct retail, including pick-your-own and in-store sales, as a response to the inadequate returns from wholesale markets and rising labor costs. Direct marketing offers more control over pricing and, consequently, profitability, contrasting with the challenges faced in wholesale. Furthermore, direct sales, including sweet and hard cider, alongside U-pick, have been identified as highly profitable avenues for apple sales.
In summary, Midwestern apple growers are adapting to market pressures by shifting towards organic certification and enhancing direct retail operations. These strategies reflect efforts to navigate the challenges of low commercial apple prices and capitalize on the opportunities within organic and direct consumer markets.
Source: Goodfruit