AN ECONOMIC ASSESSMENT OF NUT TREES Executive Summary The concentration of tree nut production in the United States varies according to the type of crop. Nearly all U.S. commercial almond, pistachio, and walnut acreage is concentrated in the Central Valley area of California. In contrast, production of hazelnuts is limited to the Pacific Northwest, mostly Oregon, where the tree thrives in that state's mild climate. Commercial pecan acreage is scattered across thirteen states in the South, although the greatest concentration of acreage is in Georgia, Texas, and New Mexico. Across the various types, more almond trees were grown in the United States than any other nut tree in the early- and mid- 1990's. Almond trees produced the highest revenue among all U.S. nut tree crops, totaling over $1 billion in 1996 and averaging to about $923 million annually between 1994 and 1996. The high values associated with this crop have resulted in increased plantings within the last few years. When these almond trees reach bearing age, it is expected that commercial production should increase significantly. Nut trees are deciduous and produce the highest yields in climates that experience cool weather during November and December, followed by warmer weather in January and February. The cool weather provides the trees with a period of dormancy in the winter, while the warm weather immediately following promotes blossom production. Without a sufficient number of chill hours, bud opening may be delayed, the bloom may be uneven, and a poor crop and branch dieback may occur. For optimal pollination, nut trees are best planted in a climate where frost does not occur after February. Low temperatures at any time during the year--below 12o F to 15o F--can cause serious damage to both the nut crop and the trees. Hazelnut trees, in particular, do not thrive in either very hot or very cold climates. Cold temperatures--below 15o F--result in reduced nut production. Very hot temperatures cause leaves to dry up and stress to the tree, again reducing crop size. These trees flourish in moderate climates that do not experience either of these extremes. Although adaptable to many soil types, most nut trees produce the highest yields in deep, light soils that have good drainage. Most nut trees do not tolerate prolonged wet conditions. Such situations can cause root rot, or weaken the anchoring ability of the roots, resulting in susceptibility to toppling during strong wind storms. In extreme cases, excessive wetness can result in the death of the tree. Nut trees are most able to withstand excessive moisture during their dormant period without any serious damage to the trees or to production. Most nut trees begin bearing nuts within 2 to 4 years after planting. While most trees may produce a small quantity of nuts during the earlier years, at least 6 years are typically required before a nut tree produces a good-sized commercial crop. Once the trees become productive, they can produce high yields for many years. Commercially productive pecan trees exist, for example, that are over 100 years old. Nut trees generally do not grow true from seed, and therefore are generally propagated by grafting or budding a desirable variety onto a rootstock. The rootstock may be a different variety of that same nut tree, or it may be associated with a related type of tree in the same family. Peach rootstock, for example, may be used in the grafting of almonds. The rootstock variety is chosen because of its hardiness or resistance to certain diseases, but may not produce a nut with desirable characteristics. As a result, the wood of a variety that produces a desirable nut is grafted onto the rootstock (after removing all of the tree's branches) of the hardier variety to achieve maximum production of the best marketable nut. Most nut trees are harvested with the use of a tree shaker. This machine grips the trunk of the tree and shakes it, causing the nuts to drop. The nuts are either caught by an apron, or fall on the ground where they are then raked up or blown together and gathered. Harvesting occurs in the fall when the nuts are ready to be released and the tree's bark is stable. As a result, trees do not need to be shaken very vigorously and harvesting (when done correctly) is not considered to be harmful to the tree. Various fungal and bacterial diseases affect nut trees, and generally cause greater damage to the nut crop than to the tree itself. There are a few diseases, however, that can destroy the tree or reduce its productivity to the extent that it is necessary to remove the tree. In most of these cases, it is unadvisable to replant nut trees on that acreage. Many diseases can be controlled with chemical sprays or fumigation. In some cases, however, the chemical most effective in controlling the disease is methyl bromide, the availability and use of which is uncertain over the next several years. Other perils can also affect nut trees. Frosts or freezing temperatures occurring directly after warm weather can damage buds that may have begun to emerge on the trees. Frost damage can have a ripple affect, reducing the tree's productivity for several years, especially if the frost occurs during the "on-bearing" year. Heavy winds are always a problem for any kind of tree crop if the winds follow long periods of heavy rains or flooding. Wet soil reduces the ability of the root system to anchor the tree, and high winds in such situations are more readily able to cause toppling. Trees infected with root rot diseases (which are also commonly associated with wet conditions) are also more susceptible to toppling in heavy winds. The demand for insurance appears to vary by type of tree and area. Several farm advisors in California, for example, felt there would be interest in crop insurance for nut trees, especially in areas where flooding and strong winds are likely to occur. Growers may also be interested because of the number of diseases that can affect different trees. Many years are often required before a disease becomes apparent and, in many cases, there are no rootstock that are totally tolerant to a disease. Growers may also want crop insurance for their trees because they may already have coverage for the crop and want to cover their investment in the tree as well. Pecan growers in Georgia, northern Mississippi, and Alabama are believed to have a fairly high demand for crop insurance to cover their nut trees. The demand for nut tree insurance is, however, thought to be less than the demand for insurance of the nut crop. Many orchards that are producing commercial pecan crops were planted in the 1800's, and some native trees are much older. The hazelnut extension specialist in Oregon did not believe that demand for crop insurance for hazelnut trees would be significant. The greatest demand would likely emerge from growers most concerned about Eastern Filbert Blight, since the disease can kill an entire orchard in 7 to 10 years. Hazelnuts are hardy and are grown in a mild environment, and many growers are believed not to be very interested in obtaining insurance only for the trees.