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| History. Beginning in the 1930s depression era, Congress has provided price stabilization assistance for certain agricultural commodities to assure a stable domestic supply of foods and fiber materials. Wheat, feed grains (barley, oats), cotton, rice, soybeans, peanuts, and tobacco are the primary commodities for which price support payments have been made to farmers over the past 70 years. These commodities make up 35% of total U.S. farm sales. Other commodities, such as fruits, vegetables, nuts, and livestock have not received any type of consistent support payments, yet they make up 65% of total U.S. farm production. (Oregon grows relatively little of the U.S. production of federally supported crops and receives less than 1/10 of 1% of federal support funding given to producers nationwide.) Several trends over the past 5-7 years have created perplexing economic difficulties for these "specialty commodity" producers (non-federally supported crops and livestock). These trends include a collapse in the Asian economies (1997) that caused a loss of agricultural export markets for U.S. growers; a strong dollar that makes U.S. commodities 20% more costly than its competitors products; trade agreements enabling importation of a higher volume of less expensive commodities; and higher costs of production in the U.S. compared to overseas competitors. | Congressional Block Grants. In recognition of these issues facing specialty commodity producers, Congress provided a total of $130 million to the States as block grants. Oregon received $3.2 million of this total (to be expended or obligated by September 30, 2002). After a series of meetings with the agriculture industry, the State Board of Agriculture, and the Legislative Emergency Board, the Oregon Department of Agriculture established a competitive grant process to allocate the $3.2 million. The application period for grant proposals ran from November 20, 2001 through January 31, 2002. A total of 263 grants were received, requesting a total of $31 million in assistance. |
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GRANT PROPOSAL DESCRIPTION HISTORY In 1846, Henderson Luelling traveled West with his family from Iowa to Oregon by wagon train, carrying two extra wagons of fruit stock, including strawberry plants. Luelling’s plants thrived in the fertile Willamette Valley, and he soon opened a nursery in Milwaukee, Oregon. Thus began the story of strawberry production in Oregon. The first canneries for Oregon strawberries were started in 1870 and during the 1920’s Oregon processors pioneered preservation of the fruit by freezing. Oregon’s agricultural heritage is intimately woven with bushels of juicy, red strawberries. In fact, if apples pie is the icon of American life, then strawberry shortcake beacons the agricultural heritage of Oregon. Oregon’s strawberry industry grew from the early 1900’s, reaching over 100 million pounds three times in history: 1964, 1968 and 1988. In the last 50 years, production has been mostly in the 60- 90 million-pound range, with one drop into the 35 million pounds range in the late 70’s. However, Oregon’s strawberry industry has been declining drastically in the last one and one half decades, from a production of greater than 100 million pounds in 1988, to 35 million in 2000. This extreme production decline is due to many factors, including: higher labor and input costs; least cost global resourcing of food ingredients; fewer, larger corporate buyers; fewer local processors and less regional control; and foreign competition. The number of growers of strawberries in Oregon has decreased from 450 in 1989 to about 229 in 2002. THE PRODUCT Generally, Oregon’s strawberries are known to be of premium quality, flavor, texture and color. However Oregon’s growing conditions result in greater cost of production, warranting a premium price. Many buyers mix Oregon’s berries with those of California or China, in order to increase the quality of their product, while keeping costs down. The greatest portion of Oregon strawberries are processed into 4 + 1 sliced pack (46%) followed by IQF (26%) and puree (10%). About one half of the crop is sold to food manufacturers, with 66% of that going to the dairy industry, mostly for premium ice cream. Another 25% of the fruit goes to Food Service, with 71% of that sold as toppings and sauces. Sales of Oregon’s strawberry crop relies
on recognition and willingness to pay for premium quality, color and taste.
It is imperative to set Oregon strawberries as the gold standard, “Bigger,
Redder, Simply Better” in order to justify the premium cost. Many
regional food manufacturers and retailers recognize the premium flavor
and color of Oregon strawberries and use them in their products.
THE PROPOSAL Goals
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| Burgerville
In the past, Burgerville has used a mix of fresh California and Oregon strawberries for their strawberry shortcake and have promoted the use of “fresh strawberries”. The OSC will partner with Burgerville, to create a significant spring promotion advertising Oregon strawberry shortcake and milkshakes. For this spring 2002 promotion, Burgerville will use only fresh and frozen Oregon strawberries, and promote them in an extensive ad campaign which will include radio and outdoor ads, print media, significant point of sale materials (menu boards, table tents, displays, etc) and possibly television. The OSC will focus on promoting Oregon strawberries thorugh displays and/or table tents in the restaurants, which allow us to get a message to epople as they dine. With 39 locations, 600 guests a day for 45 days, the Oregon Strawberry Commission will reach over a million people with our message during peak strawberry harvest season. Sales of Oregon strawberrries to Burgerville for this 45 day period are expected to double, from around 22,000 pounds last year to over 45,000 pounds this year. In addition, Burgerville offers a strawberry smoothie year-round, and the OSC is workiing with Burgerville on product specifications for use of Oregon-only strawberries. Burgerville’s budget for the spring strawberry shortcake and milkshake promotion is about $250,000. The commission will piggyback on their existing promotion, enhancing the image and details about Oregon strawberry. Our partnership cost will be $55,000 in order to get the commission information alive in the restaurant. |
| Tillamook
County Creamery Association
The OSC will partner with Tillamook County Creamery Association (TCCA) to support a Northwest retail ad campaign for possibly five major Northwest retailers for “Oregon Strawberry” ice cream. Four major retailers will supply newspaper ads for one week which will contain the commissions logo “Sweeter, Redder, Simply Better, Oregon Strawberries”, to promote a sale on Tillamook Premium Ice Cream. One major retailer will provide an in-store flier using the logo. The commission will also provide static cling point of sale materials for freezer doors which will show the commissions logo. Ads usuallty run one week and are usually in an end base. In-store promotions will feature dedicated window displays in the aisle. TCAA is still negotiating with their five retailers about the advertising promotion, so budget details are in ranges only. Once negotiations are finalized, the commission work with the DOJ to develop contracts with these companies, create the graphics needed and begin the promotion. It is expected that most of the promotions will occur in late spring around Oregon strawberry harvest. Tracking Sales Each contract will require partners to provide information on strawberry sales pre- and post promotion, and number of people who saw the message in each location. The commission will use the sales information to create a sales document that can be used to when meeting with other retailers about Oregon strawberry promotions. THE ALLIANCE The Commission Oregon’s Strawberry Commission was formed in 1962, with a mission of research and education to benefit the Oregon strawberry industry. In 2000, the Oregon Strawberry Commission passed a referendum allowing promotion. With a relatively small promotion budget ($30-50,000), the commission has in the last two years conducted some basic market research into present markets and market opportunities. The commission has also funded basic graphics, a photographic library four color brochure, Japanese trade shows and additions to the web page. The Oregon Strawberry Commission is funded in entirety by a coalition of 229 growers of Oregon strawberries (see Addendum A). Growers contribute all matching funds ($35,250) for this grant. The commission is directed by a board of 7 commissioners, including two processors and five growers. Growers and processors on the board represent a cross section of the industry in size and location, with considerable knowledge, history and experience. The board has strong, dedicated leadership that fully supports this proposal. Meetings are well attended by growers and processors. Commissioners and processors will provide in-kind time to oversee and direct the program. Staff The commission has been administered by Berry Works, Inc for the last 12 year. The staff has considerable experience with grant administration, promotion, publicity and marketing and can carry out the project in a timely manner as proposed |
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Tillamook County Creamery Association In 1909, the farmers of Tillamook County formed the Tillamook County Creamery Association (TCCA), which later incorporated all 25 operating cheese factories in Tillamook County, Oregon. To this day the cooperative continues to produce top quality dairy products for a sound future for Oregon farmers. Tillamook offers premium quality ice creams and yogurts with several flavors that feature Oregon strawberries. TCCA is a successful Oregon agricultural business committed to premium products using local premium ingredients whenever possible. TCCA uses Oregon strawberries because they are superior, fresh and local. TCCA supports Oregon agriculture, employs Oregonians and promotes Oregon strawberries and other fruits. |
Burgerville In 1922, an ambitious young Dutch immigrant named Jacob Propstra opened The Holland Creamery Company, a small dairy products business in Vancouver, Washington. Through hard work and a commitment to meeting the needs of his customers, he not only established a successful wholesale dairy products business, but also started a sit-down restaurant counter, which later became The Holland Restaurant. In 1961, Propstra’s sons applied the same standards on which the creamery company’s restaurant was founded, to create another successful quick-service, the first Burgerville USA. Forty-one years later, Burgerville is still family-owned and now has 39 restaurants in Oregon and Washington. Burgerville is proud to be a locally owned, Norhwest company, and uses Northwest suppliers of quality ingredients whenever possible. Burgerville has supported Northwest agriculure and agricultural business for 80 years, including Oregon premium strawberies. The Long and Short of It This as an alliance of the state’s strawberry growers, collaborating with other Oregon and Northwest businesses which support Oregon agricultural products and farmers, provide jobs for Oregonians, and promote premium Oregon grown products. By keeping our resources in the Northwest, we continue to support Oregon agriculture, the Oregon economy and Oregon strawberry growers, a win-win situation for all. |