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October 25, 2002 |
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| Dear Grower: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Below is a letter that was
sent to all California processors. |
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| Heinz Plant Closure H.J. Heinz Co. has told employees at its Stockton tomato cannery that it is considering closing the process portion of the plant. The cannery serves two roles for its corporate parent: processing tomatoes in paste and manufacturing paste into ketchup, sauces and other products. While jobs on the processing line are at risk, the company told employees during a meeting on Wednesday that the manufacturing lines will continue operating. Heinz will be making its decision before Northern San Joaquin Valley tomato growers plant their crop in the spring, Spokesman Robin Teets said. Aging equipment on Stockton’s processing line will play a role in the facility’s future. “We’re talking about processing equipment that is probably from the 1960s,” Teets said. “It’s getting expensive to maintain.” The plant typically processes tomatoes from July to October. Stockton’s fate won’t impact Heinz’s Escalon cannery – Escalon Premier Brands – which markets sauces, and sliced and diced tomato goods, Teets added. If Heinz closes Stockton’s processing lines, it would buy paste from the other processors to meet the cannery’s production needs. That’s allowed under Heinz’s contract, Teamsters Local 601 Secretary-Treasurer Lucio Reyes said, “but only if the paste is from packer with a union contract. We’ll watch where they buy paste,” Reyes said. “It’s very specific the work can’t be subcontracted to nonunion canneries.” If Stockton stops processing, it would be another in a string of tomato cannery consolidations. In recent years: ConAgra, Inc. closed a plant in Davis, Campbell Soup Co. shut a plant in Sacramento and Heinz closed its Tracy facility. Then came the closing of tomato canneries in Los Banos, Stockton and Modesto after Tri Valley Growers’ bankruptcy in 2000. More nationally branded companies are closing their primary processing plants and purchasing ingredients. The thinking is, why hold huge assets on your books, when high quality ingredients can be reasonably purchased elsewhere? |
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| Rumor Mill A rumor is circulating that a major canner is offering $42.00 per net ton “in the field” for tomatoes. An average canner harvest cost of $9.50 makes this offer appear to be quite close to CTGA’s offer on page one. When the canner was asked if this was true, the canner vehemently denied that they were involved. Upon closer review by those that track such chatter, the canner was reportedly to have said, “$42.00 in the field should be the price for next year.” The source then said, “It sounds like the old Bait & Switch routine to me.” So take it for what it is worth, but it reminds me of the old adage “Fool me once, shame on you; Fool me twice, shame on me.” |
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| Westlands Land Retirement A draft economic impact report, prepared for Westlands by an independent group of economists, shows that retiring up to 200,000 acres of land in the District will result in significant long-term benefits to the economy of the San Joaquin Valley’s west side. In the short term, however, the report shows that farmers, communities and workers will experience negative impacts from removing up to one-third of the District’s entire area from irrigated agriculture. Westlands has been considering a land retirement proposal first made by former Secretary of the Interior Bruce Babbit. The proposal was offered as an alternative to drainage services the U.S. government is legally obligated to provide Westlands farmers. In exchange for relieving the government of its obligation to provide drainage service, the government would purchase up to 200,000 acres of land and provide Westlands with a more reliable supply of water. Westlands would also dismiss its application to appropriate water from the San Joaquin River. The report measures short-term and long-term impacts of land retirement and compares those impacts to taking no action to address drainage issues in the District as well as to the impacts of providing drainage services. Impacts to farmers, communities, workers and government agencies and special districts were evaluated. The draft report is available for review at the Westlands website, www.westlandswater.org. |
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DELIVERED, CERTIFIED
PAID-FOR |
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| *estimated **projected |
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| The "80-20" Water Myth That 80-20 myth portrays agriculture as using 80 percent of the state’s water supply with the remainder flowing to other uses, such as the environment and cities. A short-course in water distribution points out that an average of 200 MAF of rainfall occurs each year in California. Of that amount, the lion’s share --- 125 MAF --- remains where it falls with the remainder flowing through the state as surface water. The environment receives the next largest share at 43 MAF and agriculture comes in third at 23 MAF. Urban use receives 5 MAF and the remaining 1½ MAF flows into Nevada. This breaks down to 43 percent for agriculture and 11 percent for urban users. California farmers use a lot of water in producing the food and fiber demanded by a consuming public. But remember tomorrow at the breakfast table that it takes 48 gallons of water to produce an 8-ounce glass of milk. |
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John C. Welty |
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