February 4, 2000

Water, or lack of it, and difficult markets resulting from consolidations of grocery chains and outside competition are two issues thwarting Texas vegetable producers going into the 21st century.

"There’s so many overall trends nationally and internationally affecting vegetables," said Ray Prewett, vice president of the Texas Produce Association (TPA) in Mission. "One of the top trends we are seeing is retail consolidation. Chain stores are buying out other chains and getting bigger and bigger. The buyouts give retailers more and more clout and puts them in the driver’s seat. It also forces other consolidations, which has repercussions back down the line to the producers. The retailers get to where they can tell producers ‘This is how it’s going to be.’"

For example, some retailers are beginning to require PLU stickers, but they won’t pay for it, and they’re handing down mandates on pricing, essentially telling the growers, "This is it," Prewett reported.

"Growers and shippers don’t have many alternatives. It’s sure tightening things up and hard for growers to see any benefits," he added.

According to Prewett, USDA is conducting a study, which should be released within the next few months, to measure the actual impacts of retail consolidations and mergers on vegetable farmers.

Imports are another big issue, he said.

"We’ve got a legislative initiative next session that focuses mainly on vegetables. We’re trying to get additional funds for research. Charlie Hall, an ag economist, is helping on that and Mark McClellan (director of Texas A&M University’s Institute of Food Science and Engineering) is spearheading our value-added efforts," he advised.

Prewett said the TPA has reestablished a generic marketing program for vegetables and citrus.

"One thing I’d mention statewide has to do with crop insurance on vegetables," Prewett noted. "For the first time, it looks like we have a cucumber policy, a pickle policy. It appears we’re going to have more and more crop insurance on vegetables."

As far as the current Valley crop goes, Prewett said harvesting of greens and cabbages continues, and the onion harvest should begin in March. The TPA vice president indicated that some growers went with the first planting of a new release of the 1015 onion. Melons began going into the ground in late January.

In terms of moisture, Prewett said, "We are in a little bit better shape than a year ago, but if it turns off really dry for the next several months, come mid-to-late summer, we certainly could be in a very short situation. Water continues to be a big issue. Most growers have some water right now, so at least we are not in a crisis now."

Extension Horticulturist Frank Dainello of College Station said it’s been a pretty decent growing season in the Wintergarden so far.

"Insects are a problem in a mild winter like this. The populations have been a little high and growers have been spraying a little more than normal," he reported in late January. "Carrot acreage has actually increased in the last three years. Cabbage has come back pretty good as well. Spinach acreage, which suffered big declines in the late 1980s and early ’90s, has pretty well bottomed out and there have been increases in some areas. Onion acreage is down."

According to Jose Pena, Extension economist at Uvalde, the produce industry in Southwest Texas has undergone dynamic changes over the past decade. Acres harvested and income decreased significantly and the production profile has changed substantially, but the vegetable industry has shown signs of recovery since 1997.

"About a third of the vegetable production in this region is for the fresh market. The other two-thirds and the stability of the industry comes from the processing market. No doubt labor costs have influenced these trends," said Pena. "Vegetable production in Southwest Texas, however, has shown significant increases during the last two to three years."

He said spinach production for processing (canned and frozen), as well as greens (collard, kale, mustard and turnip) acres, are relatively stable. Income from these crops increased due to better yields as a result of a sound production program including new fungicides and more efficient harvesting systems.

Cabbage continues to be a main-stay vegetable with small blocks of cabbage planted from August until February. The key has been to have cabbage for niche markets—before Thanksgiving and early spring.

Carrot acres had dropped considerably in the mid-80’s but rebounded in the early 1990s due in part to the success of the "ready to eat" baby carrot industry, the availability of new varieties and improved harvest and processing techniques. Pena expects acres to increase further in the coming years.

Acres planted to potatoes have increased substantially. Pickling cucumber production has also increased during the last few years. Mechanically harvested pickling cucumber production is a short season crop which works very well as a rotational crop. Green bean acres for processing appear to be on the increase.

Other crops with small acreages include squash, broccoli, fresh green beans and tomatoes which work well in niche fresh markets. There are also on-going trials to find new potential vegetable crops for the area including sweet corn, baby lima beans and southern peas. During the past two years, however, the increase in acres planted to sweet corn for processing, carrots for the fresh and processed market and several other changes/improvements appear to indicate that a recovery is underway in Southwest Texas.

The immediate concern, according to Frank Dainello, is that San Antonio is talking about rationing water in March.

"That would be a disaster for producers. I imagine they will be placing some kind of restrictions on the Wintergarden. For now, producers are still watering, and they don’t seem to be short," he said.

Further south, at Eagle Pass and Crystal City, is a different story.

"We have a cooperator down on the Nueces River, who said he’d love to work with us this year, but he doesn’t have the water. People are hurting down there," he said.

By and large, vegetable growers from the South Plains to the Panhandle are specialized. Dr. Roland E. Roberts, Extension horticulturist in Lubbock, pegs the number of serious growers in the region at around 100.

"We have 12,000 to14,000 acres of potatoes grown by less than a dozen farmers. Most potatoes have been grown in the area between Lubbock and Farwell, in the sandy soils of the High Plains, and there is a concentration of potatoes down near Seminole. This year, there are 4,000-6,000 acres of chip potatoes being grown for Frito-Lay and others near Dalhart. Growers are trying to develop a fresh market for potatoes."

Potatoes go in the ground in late February in the Seminole area, mid-March, along with onions, in the Plains region and early April in the Panhandle.

Roberts indicated more opportunities for chile pepper producers have driven interest in that direction.

"Pepper producers here grow everything from jalapenos to the long green chiles, and paprika. In fact, there’s a thousand acres of paprika pepper production," Roberts reported.

Some 6,000 acres of snap beans are grown for freezing between Muleshoe and Farwell, and watermelon acreage has reached around 15,000. Spinach, beets, turnips, and mustard greens grown in the region are going into processing. Roberts said a new variety of baby spinach about to be released to Texas growers, which is adapted to whole plant harvesting, has elevated interest.

"We have an ‘up and down’ interest in so-called blackeyed peas, pinkeyed peas and pinto beans. They grow well up here, but people tend to get excited when they have a strong market and a strong price, and lose interest when the price enters a down trend," he said. "H-E-B, through an intermediary dealer, contracted for a large volume of pintos here. Apparently, that will continue through the coming year..."

The Extension horticulturist said many of the region’s farmers take their vegetables to major farmers’ markets at Amarillo, Dumas, Dal-hart, Pampa, Plainview, and Lubbock. On an active day, Roberts said you will see 10 to 20 growers at one of the markets.

The recent West Texas Vegetable Conference in Hereford, which Roberts helped organize, focused primarily on how to do business with large retail chains and the effects of retail consolidation on Texas growers and shippers.

"Individually, our growers are unequipped to deal with the awesome power of large, consolidated chain entities. Even the experienced grower/shipper who has been successful in the past is finding it difficult. Electronic marketing can be very intimidating. It’s a no man’s land for the small grower who is not prepared to deal with this. The only long-term solution, to keep small growers in business, is for them to get together to form larger supply centers, or gathering areas, where they can pool products. H-E-B and United are both willing to do business with the Texas growers, but they would rather deal with one person than 11 or 12."