One of the legacies from the Great Depression that persist to this day is governmental policy affecting agriculture. A Michigan cherry farmer recently illustrated how ridiculous these policies can be, particularly something known as “marketing orders.”
Under a marketing order, growers of certain agricultural commodities form what is, essentially, a cartel and turn over crop supply decisions to boards overseen by the U.S. Department of Agriculture (or a similar agency at the state level), which are empowered to try to “stabilize” markets. During bumper years, the government sets restrictive quotas to artificially suppress the supply of crops, thereby raising prices higher than the free-market rate.
Such arrangements were authorized by the Agricultural Marketing Act of 1937. Today there are marketing orders for roughly three dozen agricultural products, including milk, fruits, vegetables, nuts and specialty crops. One of those marketing orders, the Cherry Industry Administrative Board, covers tart cherries grown in seven states – Michigan, New York, Pennsylvania, Oregon, Utah, Washington and Wisconsin.
The CIAB recently directed farmers to prevent a portion of their crops from making it to the market in an attempt to bump up prices. For cherry farmer Marc Santucci, owner of Santucci Farm in Traverse City, Michigan, this order, which came just four days before his harvest, meant that he had to dump 40,000 pounds of his tart cherries – 14 percent of his crop. The CIAB even sends people out to ensure that farmers have dumped their crops on the ground, where they are left to rot.
Santucci decided to protest the order in a very public way by posting a photo of the dumped cherries on Facebook. The image went viral, and has been shared nearly 67,000 times.
“I posted it because I want people to know that we sometimes do stupid things in this country in an attempt to do the right thing – we end up doing the wrong thing,” Santucci told UpNorthLive.com, the website of a local NBC affiliate in Traverse City.
The move is particularly foolish, Santucci said in a separate Facebook post last month, because of the global nature of agricultural markets. “It is a shame that we had to drop 14 percent of our cherries while at the same time the United States was importing the equivalent of 200 million pounds of cherries, or 40 percent of U.S. consumption,” he asserted. “The only way we are going to stop the continued growth in imports is to compete head-to-head, not with one arm tied behind our back.”
Tart cherries are not like regular sweet cherries. They have a shorter shelf life and need to be processed immediately. That costs money, so he would have had to pay money to give them away to charity. Typically tart cherries are processed into pie fillings or jam (and sometimes tart cherry juice).
A more in-depth analysis of the situation here, for anyone who cares to really get into the gritty details: http://modernfarmer.com/2016/08/cherry-dumping-farmer/
I saw one of the comments suggest this was an unintended result of Obama negotiating a trade deal with the EU. Of course, the country of Turkey is part of a customs union with the EU, which mains a trade deal with the EU is effectively a trade deal with Turkey also. NAFTA apparently never had much impact on cherries because cherries are not easy to grow in the warmer climate of Mexico. But cherries can both be grown in Turkey and the labor costs are low.
And we wonder why American farms can't compete. Apparently this trade deal was passed without any thought about how it would interact with laws that were already in existence affecting American farmers. Because if you look at this, these market orders side by side the trade agreement, it doesn't make any sense, there are conflicting aims. On the one hand, the market orders are intended to keep prices up for cherry producers by restricting supply. On the other hand, the trade agreement was obviously intended to do just the opposite, to expand the supply and lower prices for consumers. The government's right hand doesn't know what its left hand is doing.
The issue is that American farms have to dump their produce. Farms in Turkey do not.
With the trade agreement in place, that gives Turkey an unfair advantage over American tart cherry producers.
40% of America's tart cherries coming from Turkey is a lot.
And the fact that American farmers are forced to dump 15% of their crops some years probably doesn't help.
It's just completely asinine. At the very least, foreign imports should not be allowed while American farmers are forced to let their crops go to waste.
The government prevents them from putting tart cherries into the market for profit. It's based on production capability, and they send inspectors out to make sure the farms comply. If you decided to give them away to a non-profit cause (which very few farmers do) you would have to prove it (have receipts).
You might ask why an organization like a food bank doesn't just take the cherries, but most non-profits are not going to drive all the way out to a farm to collect a ton of cherries and then process them. At the very least they would have to de-pit them and then freeze the crop. I suppose it's theoretically possible for a charity to take the cherries but it's just not practical, since the cherries can at no time be sold and would have to be accounted for at every stage of the process (transportation, processing, distribution), and I'm sure the crop itself only accounts for a small fraction of the price of the finished product.