Apple Economics — 2012 Harvest Season

We have had a number of customers this fall comment that our apples at market are less expensive than the apples in the supermarket.  We would like to explain our apple economics.


apple crates

The early spring that we have been referencing all season, was devastating to some apple producing regions in the United States.  For instance, New York State and Michigan usually produce about 29,000,000 and 24,000,000 bushels of apples respectively, and this year they are expecting to harvest only 16,500,000 bushels combined.  Washington State, the #1 apple producer in the country (usually harvesting about 128,000,000 bushels of apples) expects to have a normal crop.  The reason their crops are down is because once the apple blossoms bloomed, the nation experienced a cold period which killed many of the blossoms, resulting in a crop loss.

Pennsylvania, however, was extremely fortunate and many fruit growers have a decent crop.  Pennsylvania expects to harvest approximately 11,000,000 bushels this season, bringing us up to the 3rd largest producer of apples in the U.S. for the 2012 harvest season, when normally we rank 4th or 5th.

Now, think back to your freshman Econ 101 class and the basic rules of supply and demand.  Because of the national crop shortage, the value of apples has sky rocketed – if you have apples, you are in business!

To give you a clear example of how the value of apples has increased….
In a typical year a bushel of processing apples  is worth about $3-5/bushel.  This year, apples going to the processor for juice, apple sauce, pie filling, etc. are worth about $10/bushel.
That is a tremendous increase in price for a fruit grower. 

Kuhn Orchards, however, is somewhat isolated from the national trend since our primary business is direct retail to the consumer.  We could have easily increased our apple and cider prices to reflect the potential value of our apples – but we chose to remain consistent with our pricing structure.  Our minor price increases only reflect our increases in costs, to retain a profitable margin while providing high quality products to our customers at a good value.  After all, we plan to be selling apples to our market customers for many years to come.

Hopefully this sheds some light on the national apple harvest situation, and explains why you might be getting a bargain at the farmers market this year.  Just remember, no matter what the price, you can always find a wide array of apple varieties that taste delicious (and that you can’t find at the supermarket) at the farmers market under the Kuhn Orchards tent!!

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