$40M USDA purchase for processed apple products secured by MACMA

USDA will buy $40 million of apple products from U.S. processors in a purchase secured by the Michigan Agricultural Cooperative Marketing Association (MACMA).

The Section 32 purchase — approved by Ag Secretary Tom Vilsack on Oct. 31 — will utilize around 70,000 bins of fruit, according to MACMA General Manager Dawn Drake. Items requested for USDA purchasing consideration include apple juice, applesauce cans, cups and individual quick-frozen apple slices.

“This purchase will allow processors to go out and make commitments on apples, because there's a lot of fruit in storage that’s uncommitted right now,” Drake said. 

While the final numbers haven’t been calculated yet, Drake expects this year’s apple crop to rival, or even surpass, last year’s record of 32.38 million bushels harvested in Michigan. While record harvests sound good on paper, there’s been worries about where all those apples are going to go.

That’s where MACMA came in, submitting a request to USDA to make the purchase to help alleviate some of backlog of apples by kickstarting processor demand.

“I was somewhat concerned about growers walking away from apples if they didn't have a home,” Drake said. “This purchase is not only going to help the growers, but also help the processors because their sales have been down at the retail level.”

While any apple processor in the U.S. can bid on USDA’s solicitation for the products, Drake noted that Michigan is uniquely suited for this purchase. 

“The nice thing for Michigan is that we have most of the fruit processors here in the state, so we usually benefit greatly from these purchases,” Drake added.

USDA’s solicitations for purchases are expected to go out in December, after which processors typically have about two weeks to bid before awards are announced. From there they can start purchasing fruit to fulfill the orders. Although Drake said all apple growers in the state will benefit from the USDA buy, her goal moving forward is to work with processors to give MACMA member growers priority when it comes to those purchases.

In April, MACMA secured a $21 million purchase from USDA for processed apple products for the 2022-23 crop years — equating to approximately 39,000 bins — to be used for delivery through December 2023. It marked the first purchase of its kind for apples since 2016.