Web posted August 23, 2007

That all-natural appeal
A look at how organic produce gets from the farm to your hands and what role Wal-Mart will play in the fresh-food chain

By KORRY KEEKER
JUNEAU EMPIRE

Brian Wallace / Juneau Empire
  On the graze: Denise Roselle shops for organic fruit Tuesday at Rainbow Foods. David Ottoson, owner of Rainbow Foods, says he's not concerned about competition in the organics market.
Even in the middle of a fruit's season in Juneau, the long barge trip to get it up here often leaves it looking and feeling not-so-fresh.

Distribution is a dilemma that stone-fruit aficionados and the banana-minded have been wrestling with since the Gold Rush.

With Wal-Mart moving in, are we at the forefront of a new era?

It appears so. One Juneau organic fruit and vegetable specialist says he's worried about the big stores' lobbying powers, but he doesn't expect to lose customers. The vendors, who bring in fruits in a variety of enterprising ways, believe their customers will stick by their side.

When the new Wal-Mart Supercenter opens Sept. 12, the giant chain will be bringing the time-tested distribution method that allowed it to reap $312.4 billion in sales in 2005.

Last year, the corporation announced a strategic push to double its organic fruit and vegetable market and sell for just 10 percent more than the price of nonorganics. Here, that means the chain will be getting most of its produce out of Anchorage and trying to get it to the shelf as quickly as possible.

How will it taste? Only time will tell.

"From what I know, any time there's fresh fruit in Juneau, it's big news," said shopper Rachele Carsson, 27. "If Wal-Mart can sell a good-looking organic apple at a low price, maybe they'll earn a reputation as the store to go to. I wonder how that will affect the locally owned groceries and people who run the fruit stands in the long run."

Wal-Mart's move is one of the most talked-about issues these days in the organic industry. Throughout the country, some farmers are fearful that the chain will use its size to lowball the price it pays to its organic suppliers. Still others believe Wal-Mart - like other large corporations - could use its power to lobby for weakened organic standards.

"The thing about organic foods now, is that there are some newer large-scale organic operations that are able to supply a lot of produce to a chain," said David Ottoson, owner of Rainbow Foods.

"The people who have been involved for a long time are concerned that the standards are going to become more diluted or watered down as the big players get involved," he said. "And Wal-Mart has the clout to influence the government agencies that are writing up the rules concerning the regulations.

"A lot of their organic produce, they might source in China," he said. "We've all read about the problems with China lately. And I think their agriculture is no different than anything else."

Rainbow Foods prides itself on trying to stock the "widest selection of organic produce in town." The store carries anywhere from 60 to 80 different items, all organic. Even five years ago, that would have been difficult for a Juneau store to accomplish.

But these are different days. Now a small market such as Rainbow can get all the basic produce items.

The organic selections at Fred Meyer, Super Bear, Safeway and Alaskan & Proud have slowly expanded over the last five years. It's part of a national trend to fill demand.

"I'm not that concerned (about competition), just because we're the anti Wal-Mart," Ottoson said. "We're a small, local business, and people who shop here really aren't Wal-Mart customers for the most part."

Rainbow has faced organic competition before, most notably from Full Circle Farms, the community-supported agriculture cooperative based out of Carnation, Wash. When Full Circle first started flying boxes of produce up to subscribers in 2005, Ottoson noticed a drop in Rainbow's sales.

Full Circle now offers its service to Skagway, Haines, Yakutat, Gustavus, Elfin Cove, Funter Bay, Hoonah, Pelican, Tenakee, Angoon, Sitka, Jackson College, Petersburg, Thorne Bay, Craig and Metlakatla.

But Rainbow's sales have rebounded to the point where they're "better than they've ever been.

"Since then (the sales) have come back," Ottoson said. "Right now, I'd say they're better than they've ever been.

"I've talked to a few people who said that getting those boxes from Full Circle was their first exposure to organic produce, and they were pleased with how it tasted, the variety, and what not," Ottoson said. "I think what Full Circle Farms did was expose a lot of people to organic produce who maybe hadn't considered it before."

Rainbow works with a Seattle distributor, Charlie's Produce, that supplies organic and commercial food to smaller groceries and markets. During the off-season, when Full Circle's farm isn't in production, the CSA has worked with Charlie's, too.

"A lot of people think the fruits and vegetables they're getting are always from Full Circle (farm)," Ottoson said. "In the middle of December and January of last year, they were covered with water from flooding.

"That's not a slam on them," he said. "It just means that you get it where it comes from in the season."

Rainbow gets two barge orders a week, plus a supplemental air order of more perishable items such as raspberries, figs, butter lettuce and herbs. As is always the risk with air cargo, sometimes the freight sits and the items spoil. Full Circle saw the same this winter. When snowy weather delayed flights, some greens and vegetables arrived frozen and cell-damaged.

"That happens," Ottoson said. "Things get frozen. They get damaged. It's just par for the course with anything that's perishable."

At times, air cargo also has been the bane of Juneau's summertime fruit stands.

In the summer of 2002, Jason McCowan, a then-28-year-old, Texas-born businessman, sold Oregon peaches on weekends in the Western Auto-Marine parking lot.

The peaches were picked Thursdays at Baird Family Orchards in Dayton, Ore., and flown north on Fridays.

"You can't really get good peaches here," McCowan told the Empire at the time. "I decided to try this experiment."

Nowadays, the Western Auto lot is staked out on Fridays and Saturdays by a Juneau-area man and woman who call their stone fruit business, "The Fruit Shack." The couple did not want their names in the newspaper due to personal reasons.

The Fruit Shack has been open on weekends at Western Auto for the last four summers, from the week after Memorial Day (when cherry season begins) to mid-September.

The Fruit Shack occasionally sells items that were grown organically, but doesn't claim to sell organic fruits. It's difficult to find a consistent supply from organic farms. And it's impossible for them to keep a separation between nonorganics and organics, as National Organic Program regulations mandate.

The shack will be open Sundays at the Douglas Depot, across the street from the Douglas Cafe. Aug. 19 was the first try, and business was booming.

The Fruit Shack owners moved here from Chugiak, where they ran a similar corner stand for a few years. Now they have subcontractors in Southcentral Alaska and Fairbanks.

The couple works extensively with a farmer in Wenatchee, but also buys directly from farms from the Oregon border to the Canadian border. All the fruit is flown north. The goal is to sell it within a week after it's been plucked from the tree.

"I wanted to do this in Alaska in general, because the quality of the fruit is so poor," the female owner said. "I grew up in the countryside, and I know what fruit is supposed to taste like.

"I move the same amount of produce in Juneau that my two wholesales sell combined," she said. "Maybe because the produce is worse here than what you can get in the store in Southcentral. Sometimes you can't find a carton of strawberries that doesn't have mold in it. It really is shocking. Maybe it's just become a tradition to give Southeast the worst produce."

It's difficult to make money on vegetables, because they're low-cost and they store well. Unlike stone fruits, a cucumber at The Fruit Shack won't be dramatically different from one sold in a grocery store. Some vegetables are simply cost-prohibitive to ship by air. Sweet corn can weigh about a pound an ear.

The Fruit Shack owners fly fruit up every week. And once every three weeks, when a farmer can't do it, they fly down to Washington to transport the fruit from the farm to air cargo.

Alaska Airlines does not guarantee perishables. And The Fruit Shack suffered an enormous amount of loss last summer when Alaska Airlines got rid of its union rampers at Seattle-Tacoma International Airport.

Once, a flight was grounded, and a load of cherries was left sitting on the tarmac for 24 hours. Peaches can suffer a 75-percent loss if they're belly-loaded into the plane. At times last summer, three-quarters of the batch was bruised.

Things have been better this season.

"My prices are pretty similar to, if not a little less than, the Juneau grocery store's regular prices," The Fruit Shack owner said. "They can get it cheaper at Wal-Mart and Costco, but I could open in the Wal-Mart parking lot and still sell.

"Most of my customers are my customers not because of price, but because of quality," she said.

• Korry Keeker can be reached at 523-2668 or korry.keeker@juneauempire.com.

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