Early Florida citrus estimate hangs on, barely

WINTER HAVEN – This week and next, grove workers across Florida will strip orange trees bare while the fruit is still dark green and about the size of a golf ball.

Nothing is wrong with the fruit.

The workers are toiling on behalf of Daytona Beach citrus consultant Elizabeth Steger, who has been using the stripping method to estimate the size of the next season’s citrus crop since the early 1990s. She counts the fruit from a statistically representative sample of about 500 Florida orange trees and releases her projection of the size of the coming orange crop by the middle of August.

In the seasons before the fatal bacterial disease citrus greening surfaced in Florida in 2005, most growers paid close attention to the Steger estimate because it beat the official U.S. Department of Agriculture citrus crop projection by two months. That helped set the market value of the next season’s oranges for growers with fruit to sell to the state’s juice processors, who buy about 95 percent of the annual orange harvest.

But greening has changed a lot of the economics of Florida citrus, including the value of the Steger estimate, industry leaders have told The Ledger.

In fact, whether Steger would do her estimate remained uncertain as recently as June, as several clients backed out of paying for her services, she told The Ledger.

Steger declined to say how much her work costs other than to say it is less than $100,000.

One client that initially backed out of participating was Florida’s Natural Growers, a juice processing cooperative in Lake Wales. The company’s grower members provided most of the trees for the survey, CEO Bob Behr said.

“We’re all trying to find ways to improve our members’ returns,” or profit shares, Behr said. “That’s our jobs.”

Behr declined to state the size of the Florida’s Natural financial contribution, but he acknowledged the trees it provided were a crucial part of the survey because using the same groves every year plays an important role in Steger’s statistical calculations.

“Without our trees and without us participating, she doesn’t have a forecast,” Behr said.

But Behr joined Aeden Dowling, senior director of global fruit procurement at Tropicana Products Inc. in Bradenton, to lobby for financial support for this year’s Steger estimate. In his job, Dowling deals with Florida orange growers in purchasing oranges for Tropicana’s juice products.

One of the organizations Behr and Dowling approached was Florida Citrus Mutual, the Bartow-based growers’ trade group. They spoke at the June 13 meeting of the board of directors, asking for a $10,000 contribution.

The board declined.

“The bottom line is that Florida growers are already paying for the USDA estimate,” said Mike Sparks, Citrus Mutual’s chief executive, referring to the tax growers pay on their commercial citrus harvest support USDA’s citrus activities. “Certainly the financial issue was a concern.”

'Low confidence'

Greening has changed the financial landscape for everyone in the Florida citrus industry, he said. The state’s annual citrus production has declined more than 70 percent since greening’s arrival 13 years ago, hitting just 45 million boxes in the current season, the lowest in 73 years.

“Everybody is in a financial hurt, is basically what our board told them,” Sparks said.

Sparks and Larry Black, a board member and general manager at Peace River Packing Co. in Fort Meade, which has more than 2,000 grove acres, agreed another reason behind the refusal was the declining utility of Steger’s estimate given the historically low Florida orange crop in recent seasons.

“From my perspective, the sample size is so small, and there’s so much variability in the trees because of the greening situation in Florida,” Black said. “I have low confidence in the early estimate.”

Marty McKenna, a Lake Wales-based grower, agreed.

“I don’t think the industry as a whole relies on it,” he said of Steger’s estimate. “They used to, but post-(greening), there are too many factors that affect accuracy. It’s less important because of accuracy.”

Steger defended the accuracy of her work.

“It gives you a good baseline in the beginning (of the season) – whether it will be a small, medium or big crop,” she said.

In a time of lower crops, a good forecast offers growers hope the Florida citrus industry is recovering, Steger added.

Black, McKenna and other critics agreed last year’s Steger estimate played an unexpectedly important role for the 2017-18 season. Her forecast was for an orange crop of 75.5 million boxes, the first increase in five seasons.

Steger’s estimate came out one month before Hurricane Irma swept across the state and before the USDA could complete its own count of the orange crop, the growers agreed. Steger established an important baseline for the 2017-18 crop that was used to establish the need for federal disaster assistance.

Steger’s 2018-19 estimate is going forward because Dowling convinced his colleague Behr to change his mind on backing out of supporting it.

“There was doubt until the 11th hour. Aeden was a white knight who came in,” Behr said. “There were a lot of arguments Aiden put on the table that were entirely reasonable.”

Dowling declined The Ledger’s request for an interview.

Staying the course

Behr said he was ultimately persuaded by Dowling’s argument that Steger’s estimate was still good for the Florida citrus industry. He agreed to participate in this year’s survey at a lower level – mainly by continuing to provide the trees and paying each grower for the cost of the lost fruit.

“This is an altruistic effort to supply information to the industry,” he added. “You have this historical database, and if you stop it, you’re done for good.”

George Hamner, president of Indian River Exchange Packers in Vero Beach, which packs citrus for about 4,000 grove acres, agreed the information has value.

“Is it worth funding? I don’t know because the crop is so small,” Hamner said. “Any bit of knowledge always helps.”

The question remains whether Steger will continue her survey in 2019 and beyond. Behr declined to speculate, but Steger left no doubt.

“I enjoy doing this project, and I enjoy working with all the people in Florida citrus,” Steger said. “I’ll do it as long as they need me and as long as I can still do it.”

Kevin Bouffard can be reached at kevin.bouffard@theledger.com or at 863-401-6980.