May 16, 2024

USDA to purchase more processed apple products

USDA is taking another major bite of Michigan’s apple backlog, adding to their previous $40 million purchase of processed apple products thanks to its history of working with the Michigan Agricultural Cooperative Marketing Association (MACMA).

The Section 32 purchase of applesauce cups and cans for distribution to food banks will use more than 23,600 bins of apples — or nearly 214,000 bushels.

Dawn Drake, general manager for MACMA, has estimated the purchase will total around $10 million.

In October 2023, MACMA submitted a request to USDA asking for a purchase of processed apples to help alleviate the backlog that back-to-back record crops caused in the state. A $40 million purchase was soon approved by Ag Secretary Tom Vilsack, utilizing around 70,000 bins of apples.

What sets the new purchase apart is how it came to fruition. Thanks to MACMA’s longstanding relationships with USDA staff — that have spanned 30 years in some cases — the department reached out to Drake and offered to buy additional stores with money it had leftover.

Those two purchases came in addition to another $21 million buy MACMA secured in April 2023. Combined, the three USDA purchases added up to just under 2 million bushels — around 6.3% of Michigan’s total yearly harvest.

“That’s one of the reasons why we’re so appreciative of our partnership with USDA, because we only ask for assistance if we are in need,” Drake noted. “Had we not been able to get those two purchases, then all these apples would be still in storage without a home. And we would go into next year, which would be year three of carrying over inventory, and that would ultimately make negotiations with processors challenging because we wouldn’t be able to achieve higher prices.”

While the newly announced purchase is open to any U.S. apple processor for bids, Drake said she’s hopeful that most of the purchase will benefit Michigan processors, with priority given to apples from MACMA members.

Photo courtesy of Michigan Farm Bureau.