Concerned about Supply, Semand
- By Karen Gentry
Associate Editor
That’s what Floyd Betters, CEO of Betters International Food Corporation, a New York-based company with 50 years of experience of marketing grapes and other commodities throughout the world, wanted to get across to growers during his presentation at Southwest Michigan Horticulture Days in Benton Harbor, Mich. in February.
“Do not try to outsmart the laws of supply and demand,” said Betters. He said the grape industry is coming off of a very large 1999 crush and the only blessing is that there is zero inventory. Grape growers can’t keep planting more Concord and Niagara grapes with the hopes that there will be a market. He said juice using Niagara grapes is a specialty drink.
“Let’s not get ourselves into an oversupply where we destroy the market we already have,” said Betters, about Niagara plantings.
Betters indicated that Concord grapes differ from all other grapes by virtue of the fruit. They contain potassium salts, called tartrates, which mandate the juice to settle out by gravity. This takes 45-75 days prior to being ready to use. This means tied up capital for this period and an enormous amount of tank space, which is dormant for this period. Tank space at times dictates sales, which are not always profitable because of a forced sale. Processing plants must meet the exacting specifications of the individual buyer. Failures to meet these specifications frequently force the national brand to seek another supplier.
“We should be able to sell the 1999 crush and be at a comfortable inventory level,” said Betters. “I would say the average grower is very intelligent and he will watch this year, very, very carefully. The future of plantings will depend upon how well marketed this crop is,” he said.
Demand has increased somewhat by promoting the medicinal qualities of Concord grapes. Betters said he has seen where Concord grape juice, which he terms the “Cadillac of all juices,” has taken its rightful place in a juice industry that was previously overwhelmed by orange juice touting its vitamin C. Grape juice includes antioxidants that can prevent the entrance of cancer and helps the heart through enriching the bloodstream. Grape juice also has a lot of qualities of red wine that have gotten a lot of recent publicity for its health benefits.
Betters gives kudos to Welch’s, the buyer of over 60% of all Concord grapes worldwide, for helping to promote grape juice. Practically all growers of Concord grapes belong to National Grape Cooperative, part of Welch’s. Betters said Welch’s has built a tremendous business, based on Niagara by developing a white grape juice, known for its singular flavor.
Products from Welch’s have a strong presence on the retail shelf similar to Smuckers preserves and Campbell’s soup. Betters attributes this good shelf space to quality and price.
Within the past 20 years, the state of Washington has come on strong on the grape growing scene and produced 190,000 tons of Concord grapes out of total national production of 490,000 tons. Washington now exceeds New York as the number one grape producing state.
Betters said Washington yields are 11-13 tons per acre compared to seven to eight tons per acre elsewhere. He said Washington vineyards are primarily irrigated with a different type of soil and vineyards are much younger and more productive compared with Eastern states.
As far as replacing old vines Betters said, “I think probably economics will dictate that. We’ve seen some decline on family-owned vineyards. We’re seeing more commercial types,” he said.
Betters acknowledges that grape growing has been good for the past several years. He said growers, whether they have 60 acres or 1,000 acres, must control the cost of his production, including costs for labor, fertilization, insecticides, pesticides and the amortization of the investment in the vineyard. There has to be a return on their investment.
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