Wisconsin Agriculture Series – Part II – Cranberries

WISCONSIN AGRICULTURE – PART II OF SERIES

Wisconsin Cranberries

Cranberries are only grown in North American, and Wisconsin is the largest producer of cranberries in the United States. Cranberries started being harvested near Berlin in Green Lake County around 1860 by Edward Sacket. Some basic facts about cranberries and Wisconsin farms:

  • There are over 250 cranberry farms in Wisconsin
  • Wisconsin cranberry farms cover 21,000 acres
  • Wisconsin cranberry farms are in 20 different counties
  • In 2017 it is estimated Wisconsin will produce 5.6 million barrels of cranberries, more than 60% of the nation’s crop.
  • Cranberries are Wisconsin’s largest fruit industry in both value and size
  • The cranberry was declared Wisconsin’s official state fruit in 2004.
  • Only 5% of the annual harvest are sold as fresh fruit, the other 95% is made into sauce, juice, dried fruit and other food.
  • The Wisconsin cranberry industry has a value of almost $1 billion and is responsible for 4,000 jobs according to a recent study.

* Photo from Wisconsin Cranberries Growers Association.

Cranberry production in Wisconsin has been on the rise for decades, but surpassed Massachusetts in 1995 to become the top producer in the nation.  New Jersey, Oregon, and Washington states round out the top 5 cranberry producers in the United States. In the late 1990s and early 2000s, the American cranberry industry was unable to keep up with demand for cranberry products, and Canada began investing in developing its own cranberry industry. U.S. exports have grown eightfold over the past 10-year period, 2002-2012, going from 106,929 barrels in 2002 to 877,804 barrels in 2012. U.S. and Canadian exports go to countries where the Cranberry Marketing Committee (CMC) promotes including: Australia, Austria, China, Czech Republic, France, Germany, Japan, Korea, Mexico, Netherlands, Poland, Russia/Baltics, Spain and Switzerland. Germany is the largest importer of those listed, with Mexico second, and France third. In 2012, a study conducted by UW-Whitewater economics professor Russ Kashian, found that the cranberry industry has an impact of $388,347,447 on the Wisconsin economy and funds 3,839 annual full-time jobs in Wisconsin.

After the cranberries are harvested they are sent to processors.  Canada has worked to develop some of its own processors, but a portion of the Canadian crop still gets sent to American processors. The fruit is then divided into four areas: fresh, concentrate, sweet dried cranberries (often referred to as craisins) and sauce. The largest processor is Ocean Spray, located in Lakeville-Middleboro, Massachusetts. Ocean Spray cooperative has approximately 750 members between the United States and Canada. Cranberry production in the United States is controlled by the federal marketing order which was established in 1962. The marketing order is administered by the CMC. The annual order contains recommendations to the USDA on volume regulation to apply to cranberry production.  In 2000-01 and 2001-02 crop years, the CMC recommended and the federal marketing order implemented a volume-control allowing the industry to draw down inventories to manageable levels. Growers were able to maintain a $40/bbl range from 2009 through 2011, but prices have steadily declined since 2015 are now at approximately $30/bbl.

Recent Changes and Tariffs Affecting the Wisconsin Cranberry Market

The U.S. is concerned with overproduction and the CMC has asked the USDA to place a 15% withhold on the crop. The three largest export markets for U.S. cranberries: China, the EU and Mexico have all placed retaliatory tariffs on cranberries. Prior to the tariffs, the EU had increased its cranberry imports by 15%, and China has increased imports for six consecutive years. The EU has placed a 25% tariff on U.S. cranberry juice concentrate which started on June 22, and China placed a 25% tariff on fresh and dried cranberries effective July 6. According to a report by Mark Mariani, chairman and chief executive of Mariani Premium Dried Fruit in the Wall Street Journal, China has stopped importing from the U.S.

The table below is from the USDA Foreign Agriculture Service:

Over the years, the cranberry producers have done several things to help producers with declining prices.  The cranberry farmers, in conjunction with the milk producers, have attempted to add dried cranberries to feed for livestock.  Many questions had to be answered as this partnership developed, like do cranberries turn the milk pink? (The answer is no).  Will the livestock eat cranberries?  How do the cranberries have to be processed to be able to add them to livestock feed. Right now, cranberry producers in the Ocean Spray Cooperative expect to break even, but some are looking at losses.

What the Cranberry Association Wants the Public to Know

Tom Lochner, Executive Director of the Wisconsin Cranberry Association, told The Wheeler Report that the cranberry industry in Wisconsin is significant, saying it was a billion dollar industry.  Lochner said Wisconsin cranberry farmers believe in a free and fair market allowing trade between countries.  Lochner said the Wisconsin Cranberry Association is watching the tariff activity daily.

 

Thank you to Tom Lochner and the Wisconsin Cranberry Association for helping with background material for this report.

Thank you to the Department of Agriculture, Trade and Consumer Protection for providing reference material which made this report possible.