AN ECONOMIC ASSESSMENT OF CUCUMBERS Executive Summary Cucumbers are grown for either the fresh or processing markets. Production methods differ slightly depending on the market, as do the varieties grown. Cucumbers for the fresh market are often referred to as "slicers." The varieties grown for processing are called "pickles," or sometimes, "curvys." Cucumbers are grown across the United States, although a few states dominate production. Florida dominates the fresh market. However, during the summer, when Florida's production is low, states such as Virginia, New York, and New Jersey are the large producers. Michigan and North Carolina dominate processing cucumber output. Texas, Wisconsin, and South Carolina are also major producers of processing cucumbers. An average 2.1 billion pounds of cucumbers were produced annually in the U.S. between 1992 and 1994. About 56 percent of the cucumbers produced in the U.S. were for processing use over that period. An average 1.2 billion pounds were produced annually for processing, while about 922 million pounds were for fresh-market use. Consumer preference and per-capita use of pickling cucumbers far outpaced fresh cucumber use throughout the early 1970's. Preferences began to change, however, in the mid- to late-1970's, and per capita consumption of pickles declined while consumption of fresh varieties began increasing. By 1992, consumption of fresh cucumbers exceeded that of pickles for the first time. Because of production practices, yields are generally lower for processing cucumbers than for fresh-market cucumbers. Processing cucumbers are usually grown on bare ground with little or no irrigation. In contrast, growers are willing to spend more on inputs for fresh production because of the higher associated product prices. Therefore, fresh varieties are often grown on plastic mulch in irrigated fields. In addition, fresh cucumber fields are picked more often during a harvest, which results in higher yields. Slicers are sold in a similar manner to other fresh vegetables, with farmers using brokers or state farmers' markets to sell to wholesale outlets. Larger growers may sell directly to retail outlets. Pickles are sold on a contract basis with major pickle processors, such as Vlasic and Heinz. Contracts are usually based on size and quantity. If production exceeds the pre- specified tonnage, processors often will buy the excess, provided that an oversupply of pickling cucumbers does not exist. Otherwise, any excess is not picked. The cost of harvesting a fresh-market cucumber crop is an important factor in determining whether or not to continue picking once market prices have begun to drop. Once market values fall below a certain level, picking is often terminated or a newer field is harvested, where the crop is more abundant and the cucumbers are of higher quality. In Michigan, for example, it is estimated that if prices fall below $6.00 per bushel, growers will not be able to cover their costs and will abandon the remainder of the fresh-market crop. Most growers of slicer cucumbers either have their own packinghouses or use conveyor lines. Smaller growers, and many northern Florida growers, however, transport cucumbers in picking containers to packinghouses on larger farms or to a central packinghouse. Once the cucumbers are brought to the packinghouse they are graded, sorted by size, waxed, and packed. Grading standards for slicers are set by USDA and the industry. Slicers are graded either select or super select. Pickling cucumbers are trucked in bulk to processors, who grade and size the cucumbers. The packing industry sets the standards for pickling cucumbers. The price that processors pay growers for their cucumbers is based on the size of the fruit, with smaller cucumbers commanding a higher price. Major production perils affecting cucumber production include excessive cold, drought, high winds, cool summers, and poor pollination. In particular, frost can be a serious problem for slicer cucumber production in all parts of the country. Cucumbers are very sensitive to the cold and a frost can easily kill the plant. In the Midwest, most growers wait to plant their cucumbers until after the threat of frost is past. However, growers of slicer cucumbers trying to get an early start on production may plant early, increasing their risk of loss due to frost. Growers of pickling cucumbers typically plant later in the season, as harvesting an early crop to obtain high prices is not an issue for them. Our assessment is that cucumbers may be a good candidate for crop insurance, especially in the major producing states. Many growers in these states also produce other crops that are presently covered by crop insurance, including tomatoes, peppers, and field crops. Growers who already have crop insurance coverage for other crops may be more likely to insure cucumbers than growers who are unfamiliar with the program. Cucumbers are also grown in area where weather-related perils have lead to large losses and disaster assistance payments. Florida, for example, is susceptible to storms. Unpredictable frosts and excessive moisture in the spring can affect plantings in the Midwest. Drought is a common peril reducing yields in the Northeast and Midwest. While various extension agents indicated that cucumber growers would be interested in crop insurance, several also stated that smaller growers, in particular, may not be willing to invest in the added expense of crop insurance. Cucumbers are often a second crop, or are rotated in the field with other crops. As a result, some growers may be willing to absorb the loss from a failed cucumber crop, and hope to make up the loss with the next crop that follows.