HMC News – April 2020

Take a look at a before and after of tree fruit thinning in one of our peach orchards, pictured below. Thinning is a process in which we remove under sized or over crowded pieces of fruit from our trees. This allows our trees to provide better nutrients to the remaining fruit for better sizing and flavor. It also protects tree limbs from breaking due to the heavy weight of too many pieces of fruit. During this process, our crews are also able to remove unnecessary new growth to save time and costs by not taking another pass through the orchards to prune this growth later.

We are in the midst of planting new grape varieties on our farms. Once the ground is prepped and the irrigation lines are set up, planting locations are marked and new vines are planted. It’s important for the irrigation to be set up first in order to irrigate the land before and after planting, allowing the vines to ease into their new environment. As you can see here, each new vine is given a bamboo stick for support and training purposes and a carton for protection. After the vines are planted, we work on installing our V-trellis system, which has begun with the stakes visible in the photo below.

Our stone fruit orchards are coming along nicely. The early-season peaches pictured above, which are right outside our office, are just about the size of ping pong balls. As you can see, they are already gaining a blush color. Over the coming weeks, they will grow quite a bit as they prepare for harvest, which will begin soon in our orchards. With temperatures in the mid 80s, we should have a very good quality and taste to start the season. Last year, we had lower than normal temperatures and rain for much of May, which impacted our quality. This year’s crop looks exceptionally good, and we should have great tasting fruit by mid-May, with a harvest schedule similar to last year.

Letter from HMC Farms co-owner and Chief Financial Officer, Sarah McClarty

I’m writing this blog at 5:00 am, trying to get a few hours of work done in peace before I get to perform the exhausting dance of helping keep our company afloat, our employees safe, and the nation’s food supply secure while homeschooling our two children. I’ve been doing this for almost a month now. I’m tired, I’m scared, and I’m one of the lucky ones.

We had approximately 1.5 million pounds of grapes in our cold storage destined for schools, restaurants, amusement parks, airlines, and hotels when much of the nation was told to stay home, schools were closed, and businesses locked their doors. These grapes weren’t in bags you can find in the grocery store, they were prepped for food service channels – bulk grapes, pre-cut into perfect handful size bunches and grapes already taken off the stem, washed, and ready to eat. Overnight, a lot of our food service customers stopped ordering and sent us letters stating they have no idea when they’ll be able to pay us again. No money coming in and a mountain of perishable inventory is not a business model anyone would recommend, but as my father-in-law Harold put it – we are considered an essential business, and we had the chance to keep operating. It was time to get creative.

We started repacking our grapes into retail ready bags, worked with school districts to get them the product they needed in packaging that worked for their new meal pick-up formats, and pushed inventory into home delivery services that have seen an uptick in their businesses. We have a longstanding relationship with our local food bank, and have donated millions of pounds of summer stone fruit to them over the years. We knew there was no way we would sell all of our inventory, and we also knew there was a large population in our community that would need assistance during this time. Before the grapes deteriorated, we started sending the California Association of Food Banks several truckloads of fruit each week. Last week, our local food bank reached out to their longtime donors asking if there was anything more we could do – they had a 50% jump in need in the prior two weeks, and almost a quarter of the people receiving food and supplies were first time visitors to the food bank.  Only a few months prior, HMC had hosted a volunteer night at the food bank packing up hundreds of boxes for their weekly distributions. With tears in my eyes, wondering what those families are going through now I wrote a large check on behalf of the McClarty Family.

In the forefront of our planning during this entire time has been the safety of our employees. Their health is not only required for us to keep operating, but they are part of our family and we would never want to compromise their safety. Across our operations, we have always maintained high sanitary standards as is required of food growers, handlers, and processors; but we have redoubled our efforts and taken further steps to allow for social distancing. As mitigation steps, we have broken our crews into small pods, we don’t move employees between pods, breaks and lunchtimes are staggered by pods, and in our packing facility the different pods wear different color labels to help promote separation. We sponsor a free clinic for our employees that has remained open and servicing clients during this time. Though we’ve had to lay off people in our processing plant due to the drastic downturn in business, we continue to allow them to access the clinic and receive both acute and maintenance care during this health crisis.

We are now looking forward. We have millions of dollars invested in the crops out in our fields right now. Our sales staff is doing their best to meet our customers’ ever-changing needs including adjustments to packaging that there are now even longer production lead times on. Supplies in general are hard to come by and must be ordered weeks in advance. We have started the labor-intensive practice of thinning our stone fruit, and must still pay for continued cultural practices, harvest, packing, storage, and shipment of our product before it gets to an end user. All of this means paying out money now, when we are facing the uphill battle of collecting receivables from longtime customers that are facing unprecedented financial challenges of their own.

As my son’s 2nd grade teacher told her students during one of their Zoom instructional meetings last week, we are living through a significant historical moment right now. While many people continue to try to predict, none of us know the long-term ramifications this pandemic has or will cause. We as food producers have an opportunity to be part of that history lesson, to be part of a success story. To keep our food supply flowing, we need to see flexibility in trucking rules, we need the USDA to step in and use the existing PACA Act to help keep money flowing back to producers, we need to see relaxation in regulations that are now at odds with new COVID-19 requirements, we must keep farmers and ranchers growing and producing food. Decisions being made now will impact our nation’s food supply for years. HMC is committed to helping support these changes, our employees, and our community. This is a time for everyone to get creative and to help each other out. We will keep evolving to do our best under ever-changing circumstances.

 

Sarah McClarty

Chief Financial Officer, HMC Farms