1. Specialty Crop Update (The Forgotten White Meat)
Ben Campbell
University of Georgia
Not Meat!!!
Jackfruit

2. What is a specialty crop?
USDA-AMS:
Specialty crops are defined in law as “fruits and vegetables, tree nuts, dried fruits and horticulture and nursery crops, including floriculture.”
This definition, although more exact than previous legal definitions, leaves a certain amount of latitude in interpretation.

3. The Green Industry/Environmental Horticulture Industry
Production, distribution, wholesale retail and services
Nursery and Greenhouse
Floriculture
Turfgrass

4. Top States (from Hodges et al. 2015)
Total Output Output per Capita Output/Sq Mile
California North Dakota District of Columbia
Florida Connecticut New Jersey
Texas Florida Rhode Island
Illinois Oregon Connecticut
Ohio Vermont Massachusetts

5. Where Locating? Georgia as example
2012:
Grey=no firms
Yellow=1-3 firms
Green = 4-7
Blue=7-10
Red = more than 10

6. Employment Contributions (from Hodges et al. 2015)

7. Direct Employment (from Hodges et al. 2015)

8. Output Contributions (from Hodges et al. 2015)

9. Issues with providing a specialty crop update (especially for Green Industry)
Little data on the greenhouse, nursery, and turfgrass sectors – especially for price, production, and demand
Ag Census
Census of Horticultural Specialties
Floriculture and Nursery Crop Yearbooks (stopped in 2007)
S-1065 Multi-State – survey of industry every 5 years
IBIS World Reports
Industry Surveys
Floriculture crop summary – USDA-NASS
Rely heavily on:
Economic outlook
Weather predictions – especially in Spring for demand;
in Winter for supply
Greenhouse Grower, 2016 State of the Industry

10. US housing starts

11. US housing starts

12. U.S. Dept. of Housing and Urban Development
According to the U.S. Census Bureau, U.S. building permits up 6% in first half of 2017 compared to the first half of 2016.
The increase is not consistent across all regions. The Northeast has the largest increase, and the South has a 5 percent increase in permits from 2016 to 2017.
However, through the first half of 2017, building permits in Georgia remained consistent with 2016 levels.
Table 1. New Privately-Owned Housing Units Authorized in Permit-Issuing Places US
Northeast
Mid-West
South
West
11% 4%
13% 9%
18%
-19%
31% 5%
-1%
U.S. Dept. of Housing and Urban Development

13. US GDP
The overall economy is an indicator of green industry growth. Kiplinger and Trading Economics both have the 2018 U.S. gross domestic product growth rate at 2.4 percent,

14. Unemployment Claims

15. Georgia Georgia Gross State Product Year Percent 2005 2.9 2006 1.9
2007
2.4
2008
-1.9
2009
-3.1
2010
13.1
2011
1.4
2012
0.9
2013 2
2014
2.3
2015
0.7
2016
2.1
2017
2.6
The overall economy is an indicator of green industry growth. Kiplinger and Trading Economics both have the Georgia state product growth rate expected to be around 2.9 percent in 2018.

17. Georgia Green Industry (with Brady Brewer)
Farm Gate Sales
Agents: Each GA county reports all agricultural production within the county
Total production should be reliable as some over-/under-estimate
Specialists: Average prices are reported for each commodity
Farm gate sales are then calculated for each commodity
Each year since 2000
Can give us an idea where things are headed
Impacts of recession/drought of 2008

21. Georgia Production Container Nursery Field Nursery Turfgrass
Greenhouse
Acres
Sq. Ft.
2001
3,749
5,214
39,517
17,559,610
2002
3,964
5,600
42,808
19,689,850
2003
3,946
5,846
47,223
19,419,518
2004
4,199
7,677
46,910
18,400,981
2005
4,389
8,314
49,195
19,224,290
2006
4,676
8,707
48,830
19,707,472
2007
4,718
9,238
50,535
19,068,323
2008
4,379
8,202
41,207
18,977,843
2009
4,740
8,248
33,937
17,675,066
2010
3,848
7,269
26,821
16,500,013
2011
3,489
7,069
23,093
19,690,854
2012
3,574
6,796
21,678
18,028,008
2013
3,704
7,097
22,457
17,133,765
2014
3,656
7,029
24,513
16,378,393
2015
3,699
6,912
25,657
22,613,281

22. What is apparent from the production numbers:
Many firms went out of business or experienced significant contraction after the recession and drought.
Turfgrass
The number of sod farms and average sod farm size are off 32% and 28% from 2007 to 2012, respectively.
In comparison, the number of U.S. turf farms decreased by 8% with a 15% decrease in average farm size from 2007 to 2012, respectively.
Greenhouse and nursery side
The number of farms in Georgia decreased by 28% from 2002 to 2012 with a 5% reduction in average farm size.
U.S. production was off only 10% during the same time period with average farm size shrinking by 15%.

23. Labor
Georgia (and US) firms have had to adapt to changing economic conditions either through automation or changes in hiring practices.
USDA Census of Horticultural Specialties for 2009 and 2014 it is apparent that Georgia firms are moving from hiring long-term (150 days of employment or more per year) to shorter-term workers (less than 150 days of employment per year).
Overall, employment was up 12% (equivalent to 2 workers per firm) from 2009 to 2014, but long-term employees were down 37% (equivalent to 2.6 workers per firm) with short-term employees hiring up 91% (equivalent to 5.6 workers per firm).
These statistics show how firms that survived the recession/drought are changing their business practices to maintain/increase competitiveness.

25. Georgia Prices Greenhouse Turfgrass Field Nursery Container Nursery
per Sq. Ft
per Acre
2001
13.70
3,825
14,534
55,832
2002
15.85
3,768
16,787
56,328
2003
16.74
4,127
15,832
56,088
2004
15.92
3,750
15,308
54,832
2005
15.48
3,713
14,557
53,847
2006
16.46
4,056
14,201
53,105
2007
16.07
3,699
12,478
51,982
2008
15.17
3,504
12,298
47,783
2009
16.38
3,775
12,089
48,837
2010
16.42
3,439
11,810
48,339
2011
14.71
3,407
10,507
43,048
2012
14.81
3,977
10,307
40,856
2013
14.63
4,135
10,126
40,409
2014
16.20
4,255
11,095
40,158
2015
16.41
4,276
13,073
40,926

27. Expect growth in 2018 Industry goes as economy and weather goes
Production side
Increasing production and constant/increasing prices
Demand side
Increasing demand
Increasing price competition
Other factors:
Household incomes – slow, but upward growth for GA and US incomes
Weather (hoping for dry weekends during the spring)
Forecast is for warmer winter and normal spring weather
Input costs: especially water, labor, and production practices
Will mitigate some of demand and price increases

29. Where are we Headed? New/differentiated/niche products
Production practices
Greenhouse Grower, 2016 State of the Industry

30. Where are we Headed? Labor Labor
Greenhouse Grower, 2017 State of the Industry

31. Georgia Turfgrass Survey (Clint Waltz)
Clint Waltz, UGA Turfgrass Specialist,
Does an annual turfgrass survey of Georgia producers

32. Bermuda Supply Zoysiagrass Supply Centipede: 60% adequate supply
St. Augustine: 50% project shortage, down from 80% in 2016

33. Annual Sod Survey 2017 Conclusions – Price Price Expectations
Bermudagrass – 76% forecast to remain steady
Zoysiagrass – 73% foresee stable prices
Centipedegrass – 56% remain constant
Tall fescue – 50% remain constant
St. Augustinegrass – 67% foresee stable prices

34. 2017 Turfgrass Costs On-the-farm Delivered to Atlanta* Turfgrasses
2016
2017
Change
--- Cents / ft2 --- %
Bermudagrass
25.5
24.5
-3.9
31.7
29.6
-6.6
Zoysiagrass
42.6
42.5
-0.2
49.4
47.3
-4.3
Centipedegrass
26.9
25.1
-6.7
33.9
30.1
-11.2
Tall Fescue
29.3
29.2
-0.3
34.9
35.1
0.6
St. Augustinegrass
39.3
32.5
-17.3
45.3
36.5
--19.4
* Delivered price includes freight and pallets.

35. Expect growth in 2017 (demand and profitability)
Industry goes as economy
Largest sales area:
Landscape contractors – increased housing starts and disposable income
Athletic fields – government = policies at local and federal level; private = income
Golf courses – disposable income
Other factors for 2017:
Input costs: especially water and labor

36. Thank You!
Questions??