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Febraury 17, 2005

  Dear Tomato Grower:

 2005 Pricing:

 The market continues to consolidate around a $50.00 base with each canner’s status detailed below:

  • Campbell’s, Del Monte, Escalon, Hunt, SK Foods, Unilever reviewing draft contracts
  • CTGA awaiting updated solids programs from Ingomar, Los Gatos, and  Morningstar – as indicated in previous communication all support $50.00 price
  • CTGA awaiting proposals or feedback from San Benito and Stanislaus

 Wet weather and poor economics are making it difficult for many canners to cover their pack. Some early slots down south are in jeopardy due to unlisted beds. In certain cases some canners are willing to sweeten the pot through more lenient discounts, harvest terms so don’t be afraid to ask.

 2005 Contract Intentions:

 CASS issued its 2005 contract intentions:

                         2005 Intentions        2004 Actual               2004 Intentions

Tons                10,300,000                11,762,000                11,000,000

Acres              265,000                      281,000                      293,000

Yield                39                                41.9                            37.5

 So how good a predictor is the CASS January Estimate? Looking at the last 10 years the average final is 2.35% less which would project a 10.0 million ton crop.

If you take the average 5 yr yield of 37.1 and adjust acreage by the average difference between estimates and actual, the result would be 9.6 million ton crop.

 Given all of the above, plus the wet weather and late field preparation, a 10,300,000 crop looks optimistic.

 World Processing Tomato Council Meeting:

 Representatives from Australia, Canada, France, Spain, Tunisia, Turkey, and the US attended the WPTC meeting in Sacramento January 31. A couple points of interest:

  • 2004 worldwide processing tomato production reached 34 million metric tons vs. demand of approximately 29.5 million. Although 4.5 million is a large addition to worldwide inventories, most countries, had very low inventory levels.
  • Initial 2005 projections are 31.4 million which would be concerning if achieved.
  • Australia’s harvest was interrupted by 5” of rainfall which will make reaching 350,000 ton projection a major challenge.
  • Canadian processors are pushing for a sharp price reduction due to increased costs and a stronger Canadian Dollar. Growers aren’t likely to roll over.
  • General agreement that a promotional campaign for processed tomatoes is urgently needed.

 Lycopene Health Claim:

 The FDA delayed the announcement of whether it would support a qualified health claim on Lycopene until April 12. The decision was originally slated for December and then February. A positive decision would provide an excellent marketing tool for our industry.

 Vapam Update:

 Amvac will be running a trial on Robert Teicheira’s farm, near Los Banos. The trial will measure vapam off-gassing under cool weather and spray blade application. This is critical for making the case that processed tomato growers should be treated differently than other crops that make summer applications. We thank Robert for helping in this process.

 Processing Tomatoes Diverted to Fresh Market:

 The California Tomato Commission requested that we pass the following information onto processed tomato growers. Some skeptics may say that the Tomato Commission is only after assessments, but there is a legitimate food safety issue. Please treat this information as you see fit. 

“In response to a directive of the U.S. Food and Drug Administration to the fresh tomato industry, a number of new regulations will become effective this season.  These regulations are being enacted to ensure a safe supply of fresh market tomatoes.

 

All tomatoes (field and greenhouse): 

Prior to commencing operations, growers and/or shippers must register with the Department of Food and Agriculture and the California Tomato Commission. A grower may be a shipper depending upon the scope of their operations. Shippers who are not registered, would not be allowed to pack and market tomatoes in California until they have registered.

 

Specific to Roma Tomatoes: 

Beginning this year, roma-style tomatoes (any elongated tomato) must

be packed in new 25 lb. cartons and clearly marked as “roma tomatoes” with the name and contact information of the grower or shipper printed on the carton.

 Each carton must have a grower/lot ID stamped on the carton. This is to provide adequate trace-back in the event of a food safety crisis. Shippers, or a grower, whichever applies, must have trace-back records that include: grower contact information, field, harvest date, pack date, transport, and the customer that the tomatoes are sold to.  Records must be made available to an inspector upon demand. Tomatoes must be free from any dirt or debris, in addition to meeting all current quality standards established under the California Code of Regulations. Processing tomatoes diverted to the fresh market must meet the standards and requirements that are applicable to fresh market tomatoes. 

Beginning this summer:

 

The California Fresh Tomato Growers Exchange, a producer’s cooperative,

will provide funding to enable surveillance and inspection services in

the field and terminal markets.  This will include surveillance of all tomato

harvesting in the San Joaquin and Salinas Valleys.  Tomatoes that are not

being packed in compliance with the regulations will not be allowed into

the fresh market.  Inspections at the terminal markets in the Bay Area and

Los Angeles will ensure that all products being offered for sale is in

compliance with the new regulations and meets recognized grade and quality

standards.

 

Any grower who plans to divert processing tomatoes to the fresh market should register with the California Tomato Commission.  An assessment equal to $0.04 per carton will be due the Commission.  In addition, assessments will also be due California Department of Food and Agriculture as required by Standardization and the Curly Top Control Program.  All growers/handlers are subject to audit.  Those who fail to register will be prohibited from packing and may be required to post bonds prior to packing.

 

Any tomato grower, fresh or processing, or other individual who allows the packing of tomatoes into a used container, meaning, a container of another company or individual, will be subject to litigation.”

 

California Agriculture Symposium March 23 and 24:

 The University of California, Fresno State, Cal Poly and the CDFA organized a conference dealing with the following subjects:

 -         Driving Forces for California Agriculture

-         Understanding the public policy setting and California Agriculture

-         Current Issues and concerns for California Marketing

-         New specialty crops and new challenges

-         International trade and policy

-         Technology: Air and Water Quality

 Speakers include:

Ann Veneman                                                AG Kawamura

Michael Mendes                                            Bill Lyons

Stuart Woolf                                                   Dan Sumner

 For more information please contact:  www.calagsymposium.org

Thank you for your on-going support and if you have any comments or concerns please call or e-mail.

 Ross Siragusa

209-478-1761

rdsiragusa@ctga.org

 

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