Del Monte plans to close its fruit cannery in Modesto, California, on April 7. The closure will eliminate about 600 full-time jobs and around 1,200 seasonal positions.
The decision also affects cling peach growers in California's Central Valley who supply fruit for processing. Many growers relied on the facility as a long-term buyer for their crops.
According to the California Canning Peach Association, growers supplying Del Monte typically operated under contracts lasting up to a decade or longer. These contracts provided stability for cling peach production, which requires several years before orchards reach full production.
With the closure of the Modesto plant, those long-term agreements will no longer be available.
The association says the nearest cannery, Pacific Coast Producers, plans to rely on one-year cash contracts to supply its facilities.
Stanislaus County peach grower Bill Loritelli said he previously had a contract with Del Monte, but many growers had already seen changes in the industry before the closure announcement.
"The few farmers that I know that still have them, it will definitely impact them, especially since several of them have got younger trees," Loritelli said. "Now they really have a dilemma whether they continue growing them up to maturity with no market or pulling them, and they spend a lot of money on planting them."
County agricultural officials say the closure is affecting growers beyond Stanislaus County.
Stanislaus County Agricultural Commissioner Linda Pinfold said producers in Northern California counties, including Yuba and Sutter, are concerned about losing a processing facility.
Many cling peach orchards in those areas were planted with the expectation of supplying processing plants.
For growers who established orchards years earlier, the closure introduces additional uncertainty in production planning.
Loritelli said that uncertainty is common in farming, but losing a processing facility increases the risks growers must manage.
Source: CBS News
