I want to thank all of you for letting me be part of your annual convention. For 99 years, this group has come together to strengthen Washington’s tree fruit industry, and Lord knows we need your leadership today.
We all know how tough the past few years have been. You’ve been squeezed by low prices, unfair trade practices, and many other burdens. Most of you in this room have managed to survive, but many of your friends and neighbors could not hold out.
From Tonasket to Wenatchee, we’ve lost many of our small, family orchards. Those orchards form the heart of so many rural communities. When a grower is forced out of business, we often lose the local doctors, small businesses, and the tax base for our schools.
For our state, it means losing a piece of our heritage, our economy, and our way of life. That’s unacceptable to me. And I know what you know that families and communities in every corner of this state depend on your strength and success.
Last year, the apples, cherries, and pears that you harvested made up almost a quarter of Washington’s ag commodities. Your hard work produced $1.3 billion for our state’s economy and that means a lot when we have the third-highest employment rate in America.
Your labor means jobs for pickers and packers, for truckers and shippers, and for families throughout our state. When the things you grow and process in Central and Eastern Washington can’t get into markets overseas, it affects all of Washington state. And that’s a lot of jobs beyond the orchard and the packing house. So your survival and your success is connected to every family in Washington state, and I’ve never forgotten that.
I’ve often said that the economic downturn in Washington did not start when Boeing laid off workers after September 11th. It did not start a few years before that when the technology sector slowed down. Washington’s economy started to slide back in 1997 and 1998, when your businesses were hit by the Asian Financial crisis, protectionism in Mexico, Chinese apple juice dumping, low prices, and unfair trade barriers.
And our economy will not fully recover until all those sectors return to full strength, including our tree fruit industry. That’s why I fight for you in the United States Senate, and today I want to address the theme of this conference – how to win the profitability game.
The question I want to answer is this: How do we bring Washington’s tree fruit industry back to full strength so that it can continue to support our rural communities and families throughout our state?
Before I answer that question, I want you to know where I’m coming from because when I think about agriculture, I don’t just think about commodities or sectors. I think about families, the families that grow and run our orchards and farms. And I think about my own family.
In the early 1900s, my grandfather moved his family to the Tri-Cities to take a job with the Welch’s processing plant in Kennewick, Washington. As a young child, I remember many trips to the central Washington at harvest time to visit my grandmother, who remained in the area after my grandfather’s death. To this day, the smell of fresh picked fruit reminds me of my childhood. To my dad, it meant much more. It was how his family put food on the table and paid the mortgage. I grew up understanding how important family-run orchards and businesses were to Washington state’s economy, and I’ve never forgotten that.
As I raised my own family, I always made sure we had a fruit tree where we lived so I could remind myself of my years growing up, but also to show my kids what a resource we have in Washington state and across the country. I can’t imagine discussing the economy and character of my state without a box of apples or pears or cherries in the picture.
I always loved going on trips to visit my grandmother. In the spring, we’d pass all these beautiful orchards that were in full bloom. And in the summer, we’d stop at little roadside stands to buy apples or cherries. Those are some of my favorite memories of growing up.
That’s why it was so shocking to me a few years ago to drive through Chelan and Okanogan counties and see orchards that were abandoned. It was like something died. And something had died. Those trees supported small family farms, and they supported entire rural communities. We can’t just lose these parts of our state – these parts of our heritage.
We all know that the economy is going to rise and fall. We know trade is going to ebb and flow. So we’ve got to make sure the tree fruit industry is strong enough to get through the high and lows. And over the years, I’ve been proud to work with many of you on that challenge.
I remember visiting a packing house with Pete Garza near Yakima two years ago. Ralph Longanecker brought together a group in Okanogan County to help me understand the plight of small growers in North Central Washington.
Kirk Mayer and Mike Gempler have sat down with me many times to look at farm worker issues. Mike now serves on the board of a nonprofit farm worker housing organization I helped start.
I’ve enjoyed working with former Congressman Sid Morrison and with Doc Hastings on ag issues. Randy Smith has headed up trips to Congress to connect growers with elected officials.
And Chris and his staff at the Northwest Hort Council and Jim at the Hort Association have done great work keeping me up to date on how I can help.
So we’ve got a long history together, and I’ve always been proud to stand up for you in the United States Senate. The question before us today is how can we work together – this year – to strengthen our tree-fruit industry?
My work with your industry has been and continues to be focused on four priority areas. The four areas are:
- Survival,
- Building new markets,
- Maintaining global competitiveness,
- And supporting the research that keeps your crops the best in the world.
1. Survival
The first rule of the game is survival. Trade deals take a long time to work out. We’ve got to make sure that our growers can hold on until then. We’ve made some progress on the survival front going back to the start of this crisis.
Back in 1997, many growers and organizations began telling me about the extremely low apple prices. Those low prices were made even worse by natural disasters, closed markets, and China’s dumping of apple juice concentrate.
After hearing from you, I traveled throughout Central and Eastern Washington to see the devastating effects firsthand. Grower cooperatives failed. Packing houses closed, and abandoned orchards created pest and trade problems. Communities lost doctors and dentists, rural school districts lost revenue, and Main Street businesses struggled or closed. Low prices didn’t just affect the market. They threatened the entire fabric of our communities.
So in July of 1999, I asked the USDA to come to Washington to hear from growers directly. Under Secretary Gus Schumacher came out here for a listening session, which some of you attended. It gave USDA a chance to learn about the unique needs of our apple industry for the first time.
Throughout this difficult time for the industry, I worked with my colleagues in Congress and leaders in your industry to secure direct payments to growers. In fact, Congress provided three assistance packages. That support totaled $269 million.
And I’ve got to tell you, that after I secured that funding, I received the most touching letters and Christmas cards from dozens of growers, and I want to thank folks like
James Collins in Chelan, Jerry and Donnette Olson, John Kelsch in Okanogan, the Shangri-La Orchard, James Petersen in Walla-Walla and dozens of others.
You helped me understand how critical that funding was, and I was proud to help out.
And we responded to the crisis in another way. We delivered more apples and pears to schoolchildren and low-income people through federal nutrition programs. We are exploring additional long-term opportunities with federal nutrition programs.
The Farm Bill increased funding to purchase more fruits and vegetables. These programs often respond to short-term needs, especially when there’s a surplus of apples or pears.
Perhaps the most important thing we can do to ensure this industry’s survival is to increase our efforts right here at home in our domestic markets. I am a free trader and I have worked hard to open global markets to Washington growers. But I have to tell you that there is one thing that really gets under my skin when I go into a grocery store. That one thing is walking up to an apple display, selecting a few nice apples, only to see that little sticker indicating these are apples from New Zealand. Whether its Washington, D.C. or here at home, it always bothers me. When you can walk into a grocery store in Yakima and buy New Zealand apples, something is wrong.
We have to do more to market here at home. We have to do more to ensure access to our market is the result of level playing fields elsewhere in the world. Trade is very important to this industry. But we should never lose sight of the fact that our domestic market should be the market of choice to U.S. producers.
2. Building New Markets
Nutrition programs mean another market for you here at home, and healthier food for our young people.
We have an obesity crisis in America. As we look to reauthorize the Child Nutrition Act and look way ahead to the next Farm Bill, we need to find ways to promote healthier choices, like eating more of what you produce. Just think about where your businesses would be if every American ate one more serving of fruits and vegetables every day. So when we talk about building markets, let’s not forget the one closest to home, our homes. We won’t have healthy kids and adults without you.
Of course, the global economy has brought the world a lot closer to our homes. Decisions made in New Zealand or China have huge affects on your profitability.
The bottom line is that we’ve got to build new markets and expand our existing markets overseas. That means: encouraging good new trade deals – and aggressively enforcing existing and future agreements, expanding market access programs, and pushing the Administration to treat agriculture as a priority at the negotiating table.
Too often, agriculture is sacrificed by our own trade negotiators. To get our cars and computers into new markets, our government sacrifices duty free access for our ag products. That’s not fair, it’s not right, and it’s not sustainable.
Agriculture has been a leading supporter of free trade. The apple industry in particular has supported market opening initiatives for years. It is now time for agriculture and particularly this industry to have its voice heard by your trade negotiators.
Free trade can’t just benefit a few industries or a few families. If our state is going to do well, then all of our families have to do well, whether they grow apples or build computers or make airplanes. That’s why I’m so passionate when I’m fighting for the things that our growers need in the trade arena.
Today, 1 in 4 jobs in our state rely on international trade. We cannot allow our own government to sell out your hard work in order to prop someone else up. You’re part of our history, part of our heritage and a critical part of our economy.
I’ve had a long and loud discussion with this Administration and with our trade negotiators. I’ve written letters, I’ve made phone calls, and I’ve held meetings. I want to make sure that any upcoming trade deals treat you fairly.
Earlier this fall, I joined my Senate colleagues from the Northwest in sending a letter to the U.S. negotiators responsible for the Central American Free Trade Agreement. I urged them to keep horticultural products at the top of the U.S. priority list.
And, last month, I joined Senator Gordon Smith in sending a letter to the U.S. Trade Representative asking that canned pears be exempt from both the Australian and Southern African Customs Union free trade agreements. This exemption is critical to the long-term stability of the canned pear industry.
MAP
Another way to make trade work for you is through market access programs. I’ve been a strong supporter of MAP, and I’ve worked hard to increase funding in the past two Congresses.
In 2002, I succeeded in increasing funding for MAP to $200 million by 2006. That means more bang for every buck you put into market promotion as a grower.
Ag Adjustment Act
While we work to expand opportunities abroad, we must also work to protect our growers from being undermined by poor-quality imports. I recently introduced legislation that would amend the Agricultural Adjustment Act. My bill would add pears and cherries to the list of fruits subject to regulation in a marketing order by grade, size, and quality. I believe this legislation will help ensure consumer confidence and encourage repeat purchases.
So my second priority is building new markets, and making sure you’re treated fairly by our own trade negotiators. I’m willing to use MAP and the Ag Adjustment Act to make trade work for you.
3. Maintain Global Competitiveness
I’ve talked a little bit about trade agreements already. But the global marketplace is more than trade agreements and the appearance of level playing fields. My third priority is to maintain global competitiveness for this industry.
Several years ago, I took a delegation of Washington business interests to Hong Kong and China. Chris Schlect was one of the first people I invited to join my China mission and I was so glad to have his participation and advocacy for Washington growers. One of the great things we did on that trip was get up very early on a very wet Hong Kong morning to visit a fruit distribution warehouse. We were with the Apple Commission’s Hong Kong representative. We walked among thousands of boxes of Washington apples, names like Stemilt, Firstfruits, and Manson.
I was struck by the various promotional materials all in Chinese as well as the rickety boats lined up to smuggle apples and other fruits into China. I’ll never forget what I saw that morning – in fact – I’ve seen the same thing in all of my international travels. I always look for the Washington apple and I always see the same thing: a competitive, creative industry that understands the global marketplace and competes with great success when given a fair opportunity. I know many of you are furious with the unfair trade practices of countries like China and Mexico. I am too.
Since China joined the WTO, our trade deficit has grown to $130 billion, and we’re still struggling to get our products into Chinese markets. We were promised a level playing field three years ago. We still don’t have one.
Now last month, the Chinese announced they would buy 20 Boeing airplanes to reduce our trade deficit. I’m happy to sell them those planes, but it doesn’t make up for what the Chinese have done – and failed to do – on the ag side.
We know that Mexico conveniently bars our apples from their marketplace whenever domestic growers with political connections decide to limit foreign competition. We have to realize the global competitiveness is much more than trade agreements. We have to consider the actual global practices employed by our competitors. We have to recognize and respond to China’s ability to disrupt virtually any foreign market with consequences right here in Washington state.
We have to recognize that politicizing trade at home has consequences abroad. For example, I’m concerned about the steel battle that this Administration has created. Anytime we raise trade duties here at home, our trading partners look for away to retaliate. And we all know that agriculture is the first thing to get singled out for unfair treatment.
We have to commit our country to global engagement on issues that are far broader than market access for one commodity. The United States must be, and must be perceived, as a constructive force globally if we are to see U.S. exporters succeed in competitive markets. What kind of message do we send to the world and key export markets when your leaders in Washington, D.C. are engaged in strange debates to change the name of French fries to Freedom fries?
This is a global industry. I want to continue to partner with you to see that you have every opportunity to succeed.
4. Research
Let me turn to my last priority area — research. We’ve got to continue to produce the best products in the world. That means supporting research here in Washington state.
I’m very proud of the work being done at Prosser by WSU, my alma matter. I’ve seen their work firsthand. They’re developing the disease-resistant crops, and their research is making our farmers and growers more competitive.
While the Administration may not recognize the importance of this work, I do, and I’ve fought to keep that funding in place. In fact, this year, I succeeded in restoring $3.9 million in ARS programs. The administration tried to cut that funding. I helped save it because I know it matters to you.
Conclusion
So those are the four priority areas I’m working on to help you win the profitability game.
If you’d like more information about my work on these issues, I invite you to visit my website – the address is http://murray.senate.gov. I’ve got a very detailed section on agriculture, and you can sign up to receive weekly email updates. Again, that address is http://murray.senate.gov.
So thank you once again for asking me to be here today. And, thank you for all the work that you do supporting our state’s economy. I’m looking forward to continuing our partnership and working together to ensure that Washington’s apples, pears and cherries remain competitive in the domestic and global market.
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