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September 2005, World Apple Report Highlights

Restructuring of U.S. Apple Industry Continues
The U.S. apple industry continues to restructure with no end in sight. The restructuring is taking two major forms. Many growers, packers, shippers and marketers are exiting the industry. Many of those remaining are revamping their operations to meet the increasingly challenging retail environment. The fact that all major producing districts have been hit suggests that global factors are affecting every district. Production has come down from the peak levels of the mid-1990s. International competitiveness will play a key role in determining who survives.

Ominous Chemical Threat
Scientific studies are now suggesting that chemicals in minute traces may have significant harmful effects on key hormones and genetic triggers in the human body. Furthermore, combinations of chemicals may have elevated effects. Confirmation of these findings would have major implications for the way chemicals are regulated. Under the present system, research has focused on finding the dosage level at which no observable effect occurs and setting the "safe" limit at one-tenth or less of that dosage. If minute quantities of chemicals can be harmful, that old regulatory model would not work. Intense scientific effort is being applied in Europe and North America to resolve the issue.

Debt Relief: Who Will Benefit
Under pressure from a combination of churches, charities and celebrities, the rich countries have agreed to provide $40 billion or more in debt relief to the poorest developing countries. While the decision has been hailed as a great victory for social justice, many long-term students of aid programs are not so sure. The principle seems sound. Upon receiving debt relief, poorer countries should be able to focus more of their scarce resources on education, health, relief of poverty and economic development. They should become healthy participants in the world market, both as sellers and buyers. However, that assumes that the leaders of many of these countries will give up their corrupt ways and will pass on the benefits of debt relief to their needy citizens. If they do not, they may have missed a unique opportunity. In the future, the rich countries will be so concerned about looking after their own soaring costs for their sick, retired and elderly that they will be less amenable to further debt relief for others.

The Other Sides of Fair Trade
The "Fair Trade" movement has gained many supporters and has made inroads among major retail chains in developed countries. It aims to provide a higher return to peasant farmers by cutting out the "greedy" middlemen. However, the network of middlemen have developed over time to provide many of the services needed to get the peasant's product to market, services such as provision of finance, tools, fertilizers, knowledge, quality control, assembly into larger lots, packing, storing, loading and unloading, shipping, selling, promotion, communication with buyers and many other marketing services. In many cases the Fair Trade organization becomes a competitor to the existing middlemen. It ignores the multiplier effects of the middlemen's activities in a community. Consumers and retailers need to examine the activities and claims of the Fair Trade organizations with a skeptical eye. Being a "Do-gooder" is not the same as doing good.

Statistics
U.S.: Bearing Acres of Apples, by Major Producing State, 2002-04 versus 1995-97 (chart)
U.S.: Share of Apple Production Sold Fresh, 2002-04 (chart)
CAFTA Countries: Total Imports of Fresh Apples and Fresh Pears, 2001-03, (table)
EU-15: Imports of Fresh Apples from New Member Countries, Sept 04 to Apr 05
versus Sep 03 to Apr 04 (chart)
Big Three Exporters of Fresh Apples, Marketing Years, 1999-2005 (chart)

The authoritative guide to the world apple business today.

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