P RODUCTION AND P ROCESSING IN WISCONSIN
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1 ECONOMIC IMPACT OF SPECIALTY CROP P RODUCTION AND P ROCESSING IN WISCONSIN Ashleigh Arledge Keene ( , arledge@w isc.edu) Paul D. Mitchell ( , pdmitchell@w isc.edu) Agricultural and Applied Ecnmics, University f Wiscnsin, Madisn, WI Octber 2010 Prductin and prcessing f specialty crps in Wiscnsin are imprtant t bth state and natinal agricultural and manufacturing industries. Wiscnsin ranks 7 th amng US states fr farmgate vegetable sales and 8 th fr farmgate fruit and tree nut sales. While a prtin f these sales enter fresh markets (grcery stres, restaurants, farmers markets, etc.), a significant amunt f Wiscnsin farmgate sales g t prcessrs fr freezing, canning, drying and pickling. As a result, Wiscnsin ranks 2 nd amng US states fr bth harvested acreage and ttal prductin f prcessing vegetables and 3 rd fr prductin value. Key prcessing crps in Wiscnsin include ptates, sweet crn, green WI Ptat and Vegetable Grwers Assciatin beans, green peas, carrts, cucumbers, and nins, with cranberries by far the leading fruit. In additin, Wiscnsin is a wrld-renwned prducer f ginseng, mst f which is exprted t Asia. ECONOMIC IMPACT OF SPECIALTY CROPS Prductin and prcessing f Wiscnsin specialty crps benefit the statewide ecnmy in multiple ways. In a direct sense, each sectr creates ecnmic activity and jbs within its wn industry. Hwever, bth crp prductin and prcessing als benefit nearly every ther Wiscnsin industry. Fr example, grwers purchase equipment and fertilizers frm lcal suppliers, pay farm wrkers, and invest earnings in lcal banks. In turn, farm wrkers use their earnings t pay fr husing, grceries and ther persnal expenditures. In this way, ne dllar received by a Wiscnsin farmer fr prducing and selling a specialty crp creates mre than ne dllar in value as the dllar is spent and re-spent in the statewide ecnmy. The ttal ecnmic impact f specialty crp prductin and prcessing in Wiscnsin captures this ripple effect in statewide spending. TOTAL ECONOMIC IMPACT Specialty crp prductin and prce ssing tgether accunt fr abut $6.4 billin in ecnmic activity (3% f Wiscnsin s verall ecnmy) and nearly 35,000 jbs (1% f jbs statewide), including bth indirect and induced impacts. Ttal Impact f Specialty Crp Prductin and Prcessing 1 Industries in Wiscnsin (Ecnmic activity in $ millins per year) Ttal Ecnmic Activity Ttal Jbs Vegetable & Fruit Prductin $1,092 9,900 Ptates $349 2,770 Cranberries $300 3,400 Sweet Crn $ Green Beans $ Green Peas $ Carrts, Cucumbers & Onins $ Ginseng $ Specialty Crp Prcessing $5,268 24,800 Ttal Impact $6,360 34,700 1 Prductin estimates based n av erage f armgate v alues; prcessing estimates based n 2007 Ecnmic Census v alues. Nte: Sum f impacts may nt equal ttal impact due t runding. 1
2 ECONOMIC IMPACT OF SPECIALTY CROP PRODUCTION There are rughly 1,200 large scale vegetable grwers statewide, with annual sales averaging $510 millin 1. Abut 1,700 large scale grwers prduce fruit in Wiscnsin, with annual sales averaging $240 millin 2. Wiscnsin ranks 3 rd amng US ptat-prducing states, with half f Wiscnsin ptates used fr prcessing (chips, frzen fries, dehydrated) and abut half sld fr fresh cnsumptin. Cranberries cnstitute 85% f fruit prductin in Wiscnsin and the state prduces ver half f all cranberries in the US. Fr majr prcessing crps (sweet crn, green beans and green peas), Wiscnsin ranks 2 nd amng US states fr bth harvested acreage and ttal prductin and 3 rd fr prductin value. Wiscnsin s prcessing green beans accunt fr mre than tw-fifths f US prductin. WI State Cranberry Grwers Assciatin Prcessing sweet crn and green peas each accunt fr abut ne-fifth f US prductin. Carrts, cucumbers, and nins cntribute significantly t Wiscnsin s vegetable prcessing industry. Wiscnsin ranks 2 nd in the US fr prductin f prcessing carrts, 4 th fr prductin f pickling cucumbers and 13 th fr nin prductin. Wiscnsin leads the natin in ginseng prductin, accunting fr 95% f US prductin. Specialty crp prductin directly cntributes an estimated $745 millin in ecnmic activity and mre than 6,100 jbs (full-time, part-time r seasnal) t Wiscnsin s ecnmy. Spending frm this ecnmic activity generates an additinal $350 millin in ecnmic activity and nearly 3,800 additinal jbs. Of this additinal activity, $200 millin and an assciated 2,400 jbs are indirect activity stemming frm farm spending in ther industries, such as fr farm equipment, inputs, and land. $150 millin and 1,400 jbs are induced activity frm in-state spending by farm emplyees (example: husing, grceries, taxes, etc). The ttal impact f Wiscnsin specialty crp prductin is an estimated $1.1 billin in ecnmic activity and nearly 10,000 jbs statewide. 1 Only grwers with 25 acres r mre included. Annual sales based n average values. 2 When pssible, nly grwers with 25 acres r mre were included. Annual sales based n average values. 2
3 ECONOMIC IMPACT OF SPECIALTY CROP PROCES S ING Thrughut Wiscnsin, apprximately 80 cmpanies prcess vegetables and fruit. In-state prcessing f specialty crps annually generates an estimated $3.1 billin in ecnmic activity and rughly 9,700 jbs. Spending frm this ecnmic activity spurs an additinal $2.2 billin in ecnmic activity and 15,100 jbs. Of this ttal, $1.6 billin and an assciated 9,600 jbs are indirect activity frm cmpanies spending in ther Wiscnsin industries. $580 millin and 5,500 jbs are induced activity frm instate spending by cmpany emplyees. The ttal impact f specialty crp prcessing in Wiscnsin is apprximately $5.3 billin in ecnmic activity each year and 24,800 jbs statewide. Midwest Fd Prcessrs Assciatin Prductin 1 Impact f Specialty Crp Prductin and Prcessing 1 Industries in Wiscnsin (Ecnmic activity in $ millins per year) Direct Indirect Induced Ttal Multiplier Ecnmic Activity $745 $201 $146 $1, Jbs 6,100 2,400 1,400 9, Prcessing 2 Ecnmic Activity $3,063 $1,629 $576 $5, Jbs 9,700 9,600 5,500 24, Ttal Impact Ecnmic Activity $3,808 $1,830 $722 $6, Jbs 15,800 12,000 6,900 34, Prductin estimates based n average farmgate values; prcessing estimates based n 2007 Ecnmic Census values. Nte: Sum f impacts may nt equal ttal impact due t runding. Vegetable and fruit prcessing data is nt available fr individual crps. Furthermre, because sme crps prduced in Wiscnsin is prcessed ut-f-state and sme nn-wiscnsin grwn crps are imprted int the state fr prcessing, it is very difficult, and beynd the scpe f this publicatin, t estimate the per-crp impacts f prcessing in Wiscnsin. 3
4 ECONOMIC IMPACT OF POTATO PRODUCTION Natinally, Wiscnsin ranks 3 rd in ptat prductin. In 2008, rughly 140 Wiscnsin grwers 1 prduced 2.6 billin punds f ptates, half f which were used fr prcessing. Prductin value has grwn substantially in recent years, increasing 66 percent in value between 2004 and Wiscnsin s ptat prductin directly cntributes an annual average f $240 millin in ecnmic activity and mre than 1,620 jbs t the statewide ecnmy 2. Spending frm this ecnmic activity results in an additinal $109 millin in ecnmic activity and 1,150 jbs. WI Ptat and Vegetable Grwers Assciatin $66 millin and an assciated 730 jbs f this additinal activity are indirect impacts stemming frm farm spending in ther Wiscnsin industries. $43 millin and 420 jbs are induced impacts frm in-state spending by farm emplyees. The ttal impact f Wiscnsin s ptat prductin is estimated at $349 millin annually in ecnmic activity and ver 2,770 jbs statewide. Impact f Ptat Prductin 1 in Wiscnsin (Ecnmic activity in $ millins per year) Direct Indirect Induced Ttal Multiplier Ecnmic Activity $240 $66 $43 $ Jbs 1, , Prductin estimates based n average farmgate values. Nte: Sum f impacts may nt equal ttal impact due t runding. 1 Only grwers with 25 acres r mre included. 2 Based n average values. WI Ptat and Vegetable Grwers Assciatin 4
5 ECONOMIC IMPACT OF CRANBERRY PRODUCTION Cranberries are Wiscnsin s largest fruit crp, accunting fr almst 85% f the ttal value f fruit prductin in the state in grwers prduced nearly 4.6 millin barrels f cranberries in 2008, a recrd vlume and ver half f US cranberry prductin that year. Mst f Wiscnsin s cranberry prductin is used fr prcessing, but a small prtin is sld in fresh markets. Wiscnsin s cranberry prductin directly cntributes an annual average f $199 millin in ecnmic activity each year and mre than 2,300 jbs t the statewide ecnmy 1. Spending frm this ecnmic activity generates an additinal $101 millin annually in ecnmic activity and 1,100 jbs. WI State Cranberry Grwers Assciatin $55 millin and an assciated 700 jbs f this additinal activity are indirect impacts stemming frm farm spending in ther Wiscnsin industries. $46 millin and 400 jbs are induced impacts frm in-state spending by farm emplyees. The ttal impact f Wiscnsin s cranberry prductin averages $300 millin each year in ecnmic activity and rughly 3,400 jbs statewide. Impact f Cranberry Prductin 1 in Wiscnsin (Ecnmic activity in $ millins per year) Direct Indirect Induced Ttal Multiplier Ecnmic Activity $199 $55 $46 $ Jbs 2, , Prductin estimates based n average farmgate values. Nte: Sum f impacts may nt equal ttal impact due t runding. 1 Based n average values. WI State Cranberry Grwers Assciatin 5
6 ECONOMIC IMPACT OF SWEET CORN PRODUCTION Midwest Fd Prcessrs Assciatin Wiscnsin ranks 2 nd in the US fr prductin f prcessing sweet crn, accunting fr ne-fifth f natinal prductin. Rughly 700 Wiscnsin grwers 1 prduced 652,000 tns f prcessing sweet crn in 2008, valued at $81 millin. On average, Wiscnsin s prductin f prcessing sweet crn directly cntributes $57 millin in ecnmic activity annually and 390 jbs t the statewide ecnmy 2. Spending frm this ecnmic activity results in an additinal $26 millin in ecnmic activity and 270 jbs. $16 millin and an assciated 170 jbs f this additinal activity are indirect impacts stemming frm farm spending in ther Wiscnsin industries. $10 millin and 100 jbs are induced impacts frm in-state spending by farm emplyees. The ttal impact f prcessing sweet crn prductin in Wiscnsin is estimated at $83 millin annually in ecnmic activity and ver 660 jbs statewide. Impact f Prcessing Sweet Crn Prductin 1 in Wiscnsin (Ecnmic activity in $ millins per year) Direct Indirect Induced Ttal Multiplier Ecnmic Activity $57 $16 $10 $ Jbs Prductin estimates based n average farmgate values. Nte: Sum f impacts may nt equal ttal impact due t runding. WI Ptat and Vegetable Grwers Assciatin 1 Only grwers with 25 acres r mre included. 2 Based n average values. 6
7 ECONOMIC IMPACT OF GREEN BEAN PRODUCTION Wiscnsin ranks 1 st in the US fr prductin f prcessing green beans, accunting fr tw-fifths f natinal prductin. Over 400 Wiscnsin grwers 1 prduced 327,000 tns f prcessing green beans in 2008, valued at $62 millin. Wiscnsin s prductin f prcessing green beans directly cntributes an annual average f $43 millin in ecnmic activity rughly 290 jbs t the statewide ecnmy 2. Spending frm this ecnmic activity results in an additinal $20 millin in ecnmic activity and apprximately 200 jbs. $12 millin and an assciated 130 jbs f this additinal activity are indirect impacts stemming frm farm spending in ther Wiscnsin industries. $8 millin and 70 jbs are induced impacts frm in-state spending by farm emplyees. The ttal impact f Wiscnsin s prcessing green bean prductin averages $63 millin annually in ecnmic activity and nearly 490 jbs statewide. Impact f Prcessing Green Bean Prductin 1 in Wiscnsin (Ecnmic activity in $ millins) Direct Indirect Induced Ttal Multiplier Ecnmic Activity $43 $12 $8 $ Jbs Prductin estimates based n average farmgate values. Nte: Sum f impacts may nt equal ttal impact due t runding. WI Ptat and Vegetable Grwers Assciatin WI Ptat and Vegetable Grwers Assciatin 1 Only grwers with 25 acres r mre included. 2 Based n average values. 7
8 ECONOMIC IMPACT OF GREEN PEA PRODUCTION Wiscnsin ranks 3 rd in the US fr prductin f prcessing green peas, accunting fr ne-fifth f prductin natinally. Nearly 400 Wiscnsin grwers 1 prduced 76,000 tns f prcessing green peas in 2008, valued at $20 millin. On average, Wiscnsin s prcessing green pea prductin directly cntributes $18 millin in ecnmic activity annually and mre than 120 jbs t the statewide ecnmy 2. Spending frm this activity results in an additinal $8 millin in ecnmic activity and 80 jbs. WI Ptat and Vegetable Grwers Assciatin $5 millin and an assciated 50 jbs f this additinal activity are indirect impacts stemming frm farm spending in ther Wiscnsin industries. $3 millin and 30 jbs are induced impacts frm in-state spending by farm emplyees. The ttal impact f Wiscnsin s prcessing green pea prductin is estimated at $26 millin annually in ecnmic activity and ver 200 jbs statewide. Impact f Prcessing Green Pea Prductin 1 in Wiscnsin (Ecnmic activity in $ millins per year) Direct Indirect Induced Ttal Multiplier Ecnmic Activity $18 $5 $3 $ Jbs Prductin estimates based n average farmgate values. Nte: Sum f impacts may nt equal ttal impact due t runding. Midwest Fd Prcessrs Assciatin 1 Only grwers with 25 acres r mre included. 2 Based n average values. 8
9 ECONOMIC IMPACT OF CARROT, CUCUMBER AND ONION PRODUCTION Carrts, cucumbers and nins cntribute significantly t Wiscnsin s vegetable industry. Wiscnsin ranks 2 nd in the US fr prductin f prcessing carrts and 4 th fr prductin f pickling cucumbers. Wiscnsin ranks 13 th fr nin prductin, with mst f the nins prduced here sld in fresh markets. Wiscnsin grwers prduced 77,000 tns f prcessing carrts, 39,000 tns f pickling cucumbers and 33 millin punds f nins in WI Ptat and Vegetable Grwers Assciatin Prductin f carrts, pickling and fresh cucumbers, and nins directly cntributes an annual average f $19 millin in ecnmic activity and mre than 130 jbs t the statewide ecnmy 1. Spending frm this activity generates an additinal $9 millin in ecnmic activity each year and 90 jbs. $5 millin and an assciated 60 jbs f this additinal activity are indirect impacts stemming frm farm spending in ther Wiscnsin industries. $4 millin and 30 jbs are induced impacts frm in-state spending by farm emplyees. The ttal cmbined impact f prducing prcessing carrts, cucumbers and nins in Wiscnsin is estimated at $28 millin each year in ecnmic activity and ver 220 jbs statewide. Impact f Carrt, Cucumber and Onin Prductin 1 in Wiscnsin (Ecnmic activity in $ millins per year) Direct Indirect Induced Ttal Multiplier Ecnmic Activity $19 $5 $4 $ Jbs Prductin estimates based n average farmgate values. Nte: Sum f impacts may nt equal ttal impact due t runding. WI Ptat and Vegetable Grwers Assciatin WI Ptat and Vegetable Grwers Assciatin 1 Based n average values. 9
10 ECONOMIC IMPACT OF GINS ENG PRODUCTION Wiscnsin grwers prduce nearly the entire US ginseng crp (95%). In 2007, 569,000 punds f ginseng were prduced by grwers thrughut the state. Wiscnsin s ginseng prductin directly cntributes an annual average f $11 millin in ecnmic activity and apprximately 75 jbs t the statewide ecnmy 1. Spending frm this ecnmic activity generates an additinal $5 millin in ecnmic activity and 55 jbs. $3 millin and an assciated 35 jbs f this additinal activity were indirect impacts stemming frm farm spending in ther Wiscnsin industries. $2 millin and 20 jbs were induced impacts frm in-state spending by farm emplyees. The ttal impact f Wiscnsin s ginseng prductin averages $16 millin annually in ecnmic activity and ver 130 jbs statewide. Impact f Wiscnsin s Ginseng Prductin 1 (Ecnmic activity in $ millins per year) Direct Indirect Induced Ttal Multiplier Ecnmic Activity $11 $3 $2 $ Jbs Prductin estimates based n average farmgate values. Nte: Sum f impacts may nt equal ttal impact due t runding. Ginseng Bard f WI Ginseng Bard f WI 1 Based n average values. 10
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