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June 6, 2002 Posted: 05:35:06 AM PDT

By RICHARD T. ESTRADA
BEE STAFF WRITER

West Side apricot growers, struggling to survive shrinking prices and a flood of imports, got some good news Wednesday.

U.S. Secretary of Agriculture Ann Veneman said her department will buy 6,500 tons of canned apricots from this year's harvest, which starts next week.

The purchase should be worth about $1.9 million to growers. Stanislaus, Merced and San Joaquin counties account for half the state's apricot crop and more than two-thirds of the fruit used by the canning industry.

The region's production was worth about $20 million in 2001.

"This is extremely important to the survival of the apricot industry," said Bill Fer-riera, president of the Modesto-based Apricot Producers of California.

"This will provide a home for unsold fruit, while allowing us to continue our work of rebuilding the market."

California's apricot crops in the 1990s produced up to 100,000 tons a year, but processors have been buying only about 70,000 tons in recent years.

As a result, growers last year removed trees that would have produced about 15,000 tons of fruit.

The timing of the USDA commitment is crucial, Fer-riera said, because this is the time when canners are buying fruit.

The USDA will take bids from California fruit processors -- including Signature Fruit and Del Monte Foods of Modesto and Pacific Coast Producers of Lodi -- to fill the contract.

"Because of low margins and other problems, such as Tri Valley Growers' bankruptcy, canners no longer buy apricots on speculation," Ferriera said. "They want a buyer for the fruit before they process and pack it."

California's oversupply, combined with the domination of imports in the dried-fruit market, has depressed prices paid to growers.

Canners had paid growers $330 a ton for apricots as recently as 2000, but growers settled for $290 per ton when negotiating a two-year contract in 2001.

The USDA also announced that it will buy 2,500 tons of California walnuts, about 1 percent of the state's annual production.

The USDA will distribute the fruit to school lunch programs, neighborhood shelters and community groups. It purchased 1.7 billion pounds of food worth more than $1 billion last year.

Bee staff writer Richard T. Estrada can be reached at 578-2316 or restrada@modbee.com.

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