Vegetables and Melons YEARBOOK  Summary     July 21, 2005
July 2005, ERS-VGS-2005s

    Approved by the World Agricultural Outlook Board
-----------------------------------------------------------------
This SUMMARY is published by the Economic Research Service, U.S. 
Department of Agriculture, Washington, DC 20036-5831. In addition
to this summary, the complete report is also available
electronically.
-----------------------------------------------------------------
Potato Acreage Record Low in 2005

U.S. potato growers planted an estimated 1.11 million acres in 
all four seasons--the lowest since records began in 1866. Fall-
season potato growers expect to harvest 955,700 acres, down 7 
percent from a year earlier and the lowest since 1957. Harvested 
area is expected to be lower for most major fall-producing 
States, including Idaho (down 7 percent), Washington (down 3 
percent), North Dakota (down 15 percent), and Colorado (down 10 
percent). During the March to May period, when most fall-season 
potatoes were being planted, U.S. shipping-point prices for all 
potatoes averaged $6.37 per hundredweight (cwt), less than 1 
percent below a year earlier but 8 percent below 2 years ago. 
Because of a continued stretch of low potato prices and industry 
efforts to limit acreage due to lackluster potato demand, summer-
season potato growers expect to harvest 9 percent fewer acres in 
2005. This follows an 11-percent reduction in potato area during 
the spring season. With per-acre yields expected to be 3 percent 
lower this summer, the summer potato crop is expected to decline 
12 percent. The summer season typically accounts for about 4 
percent of the annual U.S. potato crop, with Texas, California, 
and Missouri the leading States.

In 2005, total per capita vegetable disappearance (also referred 
to as use or consumption) is forecast to remain near that of a 
year earlier.  The current forecast indicates increased use 
for melons, dry beans, and freezing vegetables, with declining
use expected for fresh-market vegetables, canning vegetables, 
potatoes, and sweet potatoes.  Per capita fresh-market vegetable 
disappearance is expected to decline about 1 percent as rising 
use of spinach, garlic, and leaf and romaine lettuce is  
outweighed by potential reductions for onions, iceberg lettuce,
and carrots.  Assuming favorable weather and demand into 
the fall, consumption of fresh sweet corn and leaf/romaine 
lettuce could again approach record-highs in 2005.  With strong 
romaine shipments over the remainder of the year, per capita use 
of leaf and romaine lettuce could exceed the record-high 12 
pounds reached in 2004.

Although production was likely down in Florida and Georgia this 
year, domestic fresh-market sweet corn disappearance could still 
remain near last years record high with good volume from 
California and expectations for improved output in New York, 
where yields were low in 2004. Last seasons low onion prices 
have caused storage onion producers to pull back on acreage this 
year. Given lower production in 2005, f.o.b. shipping-point 
prices will improve and per capita use of fresh-market onions 
will likely drop below the 2004 record high. A rebound in use is 
expected for dry edible beans in 2005 as increasing production, 
higher imports, and smaller exports offset the effects of low 
beginning stocks. 

During the first 6 months of 2005, f.o.b. shipping-point prices 
(a proxy for grower prices) averaged 11 percent above a year 
earlier as higher prices during the spring quarter (April-June) 
outweighed lower prices during the winter quarter (Jan.-Mar.). 
During the winter quarter, shipping-point prices declined 5 
percent from a year earlier as periods of cool, rainy weather 
were brief enough to have little effect on yields and shipment 
volume coming out of the California/Arizona desert and Florida. 
However, the rainstorms did affect the timing of spring-crop 
planting and the accompanying cool, windy conditions persisted 
into the spring, resulting in delayed harvests and reduced 
yields. Crops in Mexico were also affected, with the weather 
causing shipments of fresh-vegetables to the United States to 
decline from a year earlier. As a result, supplies of all fresh 
vegetables in the United States during the second quarter were 
reduced, resulting in shipping-point prices averaging 28 percent 
above the low levels of a year earlier. 

Processors of five major vegetables (tomatoes, sweet corn, snap 
beans, green peas, and cucumbers for pickles) have contracted 
1.22 million acres in 2005--down less than 1 percent from the 
comparable producing States of a year earlier. Contract 
production accounted for 97 percent of the output of the five 
leading processing vegetables last year. Canneries, which account 
for two-thirds of all processing vegetable area, have contracted 
for 1-percent fewer acres than a year ago. Area for tomatoes, the 
largest single processing vegetable, will be 8 percent smaller 
than a year ago due to higher carryover stocks and lackluster 
wholesale prices. Given average yields, total production of the 
five leading canning vegetables is expected to decline from the 
15.0 million short tons of 2004. For processors of frozen 
vegetables, contract area is forecast to decline 2 percent from 
year-earlier levels as lower sweet corn and green pea plantings 
outweigh an 8-percent gain in acreage for snap beans. Given 
average yields, contract production for the three leading 
vegetables for freezing is expected to decline 1 to 3 percent 
from the 2.1 million short tons produced in 2004.

Assuming average acreage losses and yields hovering near the mean 
of the previous three seasons, total production of the 11 
selected processing vegetables could decline 6 to 10 percent from 
the 17.8 million short tons harvested in 2004. The majority of 
the decline in processing output this year will likely stem from 
the expected reduction in California tomato production from last 
years near-record levels. Average retail prices for all 
processed fruits and vegetables increased just over 2 percent 
during the first 6 months of 2005, reflecting higher packaging, 
transportation, and marketing costs. 

The first estimate of 2005 contract production for processing 
green peas indicated a 3-percent decline from a year earlier to 
394,070 short tons. Estimated area for harvest was down 1 percent 
from a year earlier. Per-acre yields are also expected to drop 3 
percent to 1.88 tons after also declining a year earlier (yields 
were record high in 2003). Reduced output in Washington (down 23 
percent) and Oregon (down 35 percent) is expected to outweigh a 
12-percent gain in Minnesota (the top producing State) and a 33- 
percent jump in Wisconsin. Wholesale prices for canned peas over 
the first 6 months of 2005 are averaging about 2-percent below a 
year ago, while prices for frozen green peas have been running 
about 2-percent above the same time a year earlier.

This summer (largely July-September), fresh-market vegetable 
(excluding melons) area for harvest is forecast to rise less than 
1 percent from a year earlier to 305,400 acres. For the most 
part, increased area for broccoli, tomatoes, and sweet corn will 
outweigh reductions for crops such as head lettuce, cauliflower, 
and cabbage. This small gain in summer area follows a decline in 
spring vegetable area. Although vegetable area is up slightly 
this summer, melon area for harvest is expected to drop 2 
percent, with increased honeydew area (up 7 percent) being 
outweighed by lower area for watermelon (down 3 percent) and 
cantaloup (down 5 percent). Although total watermelon area is 
down this summer, the seedless watermelon category continues to 
dominate shipments, with seedless now accounting for nearly 
three-fourths of the movement of all domestically-grown 
watermelon. 

Growers in California, accounting for 46 percent of this years 
summer-season vegetable and melon area (down from 47 percent a 
year earlier), reduced acreage 2 percent. New York, the second 
leading summer-season producer, with 17 percent of acreage, 
expects to harvest 7 percent more area than a year ago, due 
largely to a 14-percent increase in sweet corn acreage. With U.S. 
fresh-market area little changed from last summer, average yields 
will leave supplies near the relatively strong volume of July-
September 2004. Assuming continued strong economic activity and 
attendant demand, summer-season fresh-market vegetable prices are 
also likely to average near the relatively strong levels of the 
past year. During the summer quarter of 2004 (July-September), 
prices received by growers and shippers of fresh-market 
vegetables and melons averaged just 2-percent below the record 
highs experienced during the summer of 2003.

In 2005, U.S. dry bean growers expect to harvest 1.57 million 
acres--29 percent greater than a year earlier. Planted area 
increased 24 percent in response to strong dry bean prices, low 
carryover stocks, and less attractive prices and revenue streams 
for alternative crops. With only a few exceptions, production is 
expected to increase for most classes, and prices are expected to 
weaken into the fall. However, prices for most bean classes are 
not expected to collapse because the increase in 2005 production 
is likely to be about sufficient for use over the coming season, 
with carryover stocks again expected to be relatively low coming 
into the 2006/07 season.

According to U. S. Department of Agriculture estimates, 2005 dry 
pea (largely green and yellow) planted area jumped 52 percent to 
804,000 acres, while Austrian winter pea area increased 23 
percent to 37,500 acres. Most of the surveyed increase in dry 
peas will occur in Montana (up 99 percent) and North Dakota (up 
71 percent), with plantings expected to be lower in the Pacific 
Northwest. Area planted to lentils rose 30 percent this year to 
450,000 acres, led by Montana (up 118 percent) and North Dakota 
(up 30 percent). With relatively favorable weather pointing 
toward average yields or better, production will again be up 
substantially for both dry peas and lentils. The new larger crops 
will add to substantial existing carryover stocks (stored in all 
positions as of June 1) of 3.2 million cwt for dry edible peas, 
1.3 million cwt for lentils, 175,000 cwt of Austrian winter peas, 
and 26,000 cwt of small chickpeas.