Weather played a major role in 2010. Wet spring, more snow than normal and the occasional hailstorm, harvest delays were the norm this past year.

Exotic pest problems and competitive pressures from other U.S. production regions this made 2010 a difficult year for the California 2010 tree fruit industry.

Overall crop production was estimated at just over 50 million packages. Some believe the crop must be reduced another 15 percent to 20 percent to become profitable again. Hence, it is expected that producers will continue to pull varieties which do not appeal to retailers and consumers as they once did. A critical factor that helps is that customers have grown accustomed to paying premium prices as long as quality and consistency expectations are being met. Overall, acreage has been reduced by 16 percent since 2005 while total value of production has increased (with apples and plums being the exceptions).

Production costs particularly labor, inventory and shipping are major concerns for the industry as well as dealing with increased food safety and food security concerns. Despite good press promoting the health benefits of increased fresh fruit consumption, some tree fruits have seen consumption decline (e.g., apples). However, peach consumption increased significantly.

This may be due to the wide variety of peaches available that give consumers better flavor. Exports are a bright spot for the industry with significant increases since 2004.

(This outlook report was presented at the recent 29^th annual Agribusiness Management Conference in Fresno, Calif. sponsored by the Center for Agricultural Business, California Agricultural Technology Institute and the Jordan College of Agricultural Sciences and Technology at California State University Fresno)