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Florida oranges are mostly processed into juice, and California oranges are mostly sold to the fresh market. The Florida industry has been been buffeted by hurricanes, disease, and imports from Brazil, so reducing production costs is critical. There is a mechanical harvester available for Florida growers, which shakes the tree canopy to dislodge the fruit, but less than 7 percent of the processing orange crop is harvested this way. Work is underway to make the harvester more profitable for growers to adopt. California orange growers cannot employ the mechanical harvester used in Florida because it damages the skin of the fruit, rendering it unacceptable for the fresh market. The California orange industry does not face serious import competition during the season for navel oranges, the dominant variety. U.S. fresh orange consumption has declined, which makes the industry more reliant on export markets where China could be a major competitor. This situation could encourage growers to take a closer look at mechanical harvest options.
Raisin production and domestic consumption have declined. The U.S. industry exports almost half of the raisins it produces and faces export competition from Turkey, a low-cost supplier. U.S. raisin growers began adopting mechanical harvesters in large numbers in 2001, following a 56-percent drop in raisin prices in 2000, a tighter labor supply, and the introduction of an improved mechanical harvester. Adoption of new machinery and associated changes in how raisin grapes are produced can be expensive, making it likely that younger and larger growers may mechanize first. The raisin industry has many small producers nearing retirement age. Adopting expensive new harvest technology may not be economically viable for this group.
Strawberries are produced year round in California. Average annual production increased 81 percent from 1990-92 to 2005-07, and per capita consumption rose 75 percent over the same period. California strawberry growers produce for the fresh market and use the processing market for berries that cannot be sold fresh.
With no significant import or export competition in the fresh market, strawberry growers are in a better position than other fruit and vegetable growers to pass some increases in labor costs along to consumers. But growers are facing import competition in the processing market, which creates pressure to reduce costs.
Strawberries may be one of the most difficult crops to mechanize; there is no commercial mechanical harvester available currently. Some growers are using a labor aid to boost labor productivity in the fields—a conveyor belt that moves slowly down the field just ahead of the workers to provide a platform where workers can place their full flats of berries instead of carrying the flats to trucks at the edge of the field.
Asparagus growers face intense import competition. Fresh asparagus imports accounted for 76 percent of average annual domestic fresh consumption in 2005-07, and this share is likely to continue increasing. With increasing imports, U.S. average annual production (fresh and processed) decreased 46 percent between 1990-92 and 2005-07. A prototype mechanical harvester is being tested but, in the meantime, growers may further reduce plantings.
Lettuce production is concentrated in California during the spring to fall seasons, with both California and Arizona supplying lettuce during the winter season. U.S. imports of lettuce are small, and export competition is not a concern. Baby leaf lettuce is mostly mechanically harvested, and it is unlikely the industry could have grown so rapidly without mechanization. The rest of the lettuce industry still uses hand harvesting. If wages rose, lettuce growers could probably pass on some increases in labor costs to consumers. Many firms are currently engaged in research on mechanical lettuce harvesters.
Adapting to rising wages
Labor is just one input in a complex production process, and growers have several options if wages rise. For example, growers may use less labor if the wage rate increases. As