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> Del Monte went out of business because there wasn't enough demand for the peaches.

Things are often more complicated than that. Del Monte was founded a long time ago and fruit trees take a long time to grow. As a result, as the originator of those trees, you're at a disadvantage because you have to pay for many years of maintenance and interest on capital before the trees bear fruit, and are then sitting on a load of debt from the unproductive years that you can't service if the market price is low after the trees are producing.

But bankruptcy (or new ownership) clears the old debt, and then you're left with a productive asset that might not have been worth the cost to create at current prices, but could easily be worth the cost to continue using now that growing the trees is a sunk cost, which requires a much lower market price to be sustainable.

> In the article you can even see that the farm lobby was so powerful that they got the USDA to pay for the tree removal.

That sounds a lot like a cartel acting through regulatory capture to limit supply.

Like if destroying the trees to grow something else was more profitable than continuing to sell the produce then why does it require a government subsidy?

> if we had forced the peaches to be grown and canned (as many comments are suggesting) then that would be a different kind of waste as they'd sit in warehouses while the land, resources, and labor were used to produce something people weren't buying instead of being used to produce foods they were buying.

Worse, the price would have to be lowered to bring up sales, which could put the other peach farmers into bankruptcy as well.

The big thing I fear about this sort of destruction is that it takes a very long time for tree bearing fruit to start turning a profit. That means someone that wants to plant new trees needs to do so with the notion that they won't get any sort of return on investment for a decade.

My fear is that institutional farming does not have the long term fortitude to ever start growing a tree bearing crop. Once these trees are destroyed, they are gone for good regardless how the demand shifts.

A downturn of 2 or 3 years or crazy political maneuvers which kill off exports puts access to these fruit in jeopardy. And once they are out of the diet, it's very hard to get them reintroduced. That's a big part of the reason why the US has such a limited fruit diet in the first place (the other being that many fruits are very hard to ship).

> Del Monte went out of business because there wasn't enough demand for the peaches

They appear to have gone out of business because of massive debt from a leveraged buyout, combined with other issues.

https://www.linkedin.com/pulse/when-private-equity-overcooke...

I don’t know about peaches but ‘round my way the cider apple farmers spank the living daylights out of their high density dwarf trees. They get grubbed up and replanted in under a decade. Fruit trees have a naturally short lifetime but mega yield modern species are something else — the arboreal equivalent of a 40 day broiler.

Ironically, there’s a century year old perry tree at the top of the valley.

> The comments talking about farmers not being organized enough or powerful enough must be unaware of how powerful the farm lobby is and how much money they're able to secure from the government every year.

Most people don't realize how powerful farmers are in the US. We (rightly!) complain about Wall Street and bank bailouts when they happen, but I'd wager that we've given significantly more money to farmers over time, through bailouts (like this one) and regular subsidies.

Maybe that's a good use of tax dollars, maybe not. It feels bad, but I'm not an economist.

(And before anyone says that farmers are much more sympathetic characters than bankers, remember that "farmers" in the US overwhelmingly means gigantic corporate farming conglomerates; the individual family with a few hundreds or thousands of acres of land and hearts of gold is sadly increasingly uncommon.)

> Del Monte went out of business because there wasn't enough demand for the peaches

How did this happen? It takes a long time before a peach tree seedling gets to the point where it can bear a significant amount of fruit. I'm going to guess about 10 years. Given that kind of delay, how did they get into a situation where there was this much over-production?

> Del Monte went out of business because there wasn't enough demand for the peaches.

Maybe if grocery store peaches weren't a fibrous, tasteless representation of a real fresh peach, they'd still be in business.

The new crop will be grapes of wrath

Great point, hoping whatever replaces them uses less water. Ag pulls ~40% of California's water and it feels like 3 out of every 4 years is a drought

Is wood that useless that they need to be paid to remove it ?

There might be not enough demand to match the capacity they contracted and invested to can, but surely there is some demand. You'd think someone would buy out some of the contracts and the canning capacity at a discount and continue some sort of operation.

> A situation like this bring out many comments that reveal a very low understanding of basic economics (and a low rate of reading the article).

And a very low understanding of basic biology. A bunch of rotten fruit is _exceptionally valuable_ in many parts of the world. There's a million things you can do with it, alcohol, fertilizer...

edit: me right now I'm in a position where I could really use truckloads of rotten, inedible peaches if I could get them for free. Trying to figure out the most economic way to get a rather barren place some soil.

In the first half of this comment I thought you were setting us up for a old-Google-style interview question. I felt oddly disappointed to not find a Fermi problem at the end.

You have not made any attempt as an argument. That’s a pure assertion was even an attempt at a causal chain. Being resilient to non-problems is a cost with no benefit.

[dead]

And they usually don't introduce something everywhere at once. They do trial markets, or short-term runs. If something proves very popular (e.g. chicken nuggets) it eventually rolls out everywhere.

A big part of the problem here is that Del Monte was the victim of several leveraged buyouts that had executives walking away with millions while the company was saddled with debt.

They will be replaced with something else, don't feel bad for the trees, they had a good run.

It’s an injustice to destroy orchards of commercially planted fruit trees that were bathed in pesticides for their entire life? I’m not seeing the injustice here, something else will be planted in place of the peach trees. It’s productive agricultural land.

I don't know what you mean by 'injustice' - it seems to be a proxy for 'I don't like it when trees die'. Is there more?

What is unjust about cutting down an orchard producing a product people aren't buying?

This isn't pristine old growth forest, it has no great ecology.

This idea sounds like continued misallocation

I mean, we already have one company going bankrupt in part because they are unable to sell enough of their production to cover costs. Your plan would just cause more peach producers to go bankrupt.

>Have a banner year of peach sales in California for super cheap... market corrects for its past mistakes.

Bankrupt everyone who grows peaches then?

There are actual costs in growing, harvesting, and delivering produce to market you know.

You're assuming that the customer growing their own fruit could do it at lower overall cost. Logistics are fairly inexpensive all things considered, if they really represent 90% of the total cost of fruit it says a lot for how low agribusiness has driven down the cost of the other 10%.

As an owner of an apple tree: that's great for about two months, but I don't have commercial quantities of cold storage.

Local deer everywhere agree: this is the solution

No one is stopping customers from growing their own food. What's stopping is the lack of expertise knowledge and time commitments it takes to harvest.

This relates to what the first poster said though, at these quantities “just give it away” is incredibly expensive. Trucks, workers, cleaning, fuel, etc.

Just give it away still requires someone to pay for it

> The great injustice is very much me paying however much per pound of peaches when the supply is so great that they should be much cheaper.

But its not, because the supply and competing demands for motor fuel and all the other things that are required between the orchard are involved, not just the supply of peaches at the orchard.

You want BC Okanagan peaches. I've found them to be dramatically better than anything that's come out of the states for some reason. Granted, most of those would probably be coming from the western half of the country

There's a floor on what they can charge, though: the cost of maintaining the land, the cost of labor to harvest, the cost to process the peaches and package them, the cost to ship them to the store, and the store's cost to hold them in inventory before you buy them.

A business cannot stay in operation if the only way to sell the product is to sell it below cost[0]. Having all this excess production is exactly why Del Monte failed as a company. There's no point in building a business to provide people with below-cost food; it's not sustainable and is ultimately wasteful.

Find a way to get the peaches from the trees to people's homes cheaper? Great, do that, and maybe you can sell more at a lower price.

Or produce fewer until you can sell at a price above cost without much waste. We don't wring our hands at factory owners when they don't manufacture a huge surplus of toys that no one wants to buy. We shouldn't be upset when farmers decide to stop growing as much of a certain crop because they can't sell it all. I get the visceral reaction against killing trees. But that's an emotional response that has nothing to do with the reality of the situation. I would much rather that land be used for a more productive crop that people actually want to buy, at prices that reflect what it costs to produce.

[0] Cue VC-funded startup jokes.

>However, if these are the trees that grow rock hard peaches that never soften as they ripen with no flavor, t

That's not even how trees work. If they wanted, those same trees could grow plums within 2 years, or almonds, or pretty much any stonefruit except cherries (which tend to be incompatible).

When I moved to the US from southern Europe I was so horrified by the lack of taste of any fruit I tried, particularly the peaches and plums. I moved back to Europe and not a small factor was the lack of good produce and food in general. Its just mind boggling how Americans dont revolt against this, stop buying shit produce and suppliers will notice.

US farmers are up there in terms of how much business protection exists for them. I do think there were policy issues and recent political extremism has diverted a lot of their political will from the matters that are critical to them - but this sort of an issue is larger than just collectivizing. Agriculture is a global market that is uncoordinateable (at least without massive effort) and so if local protections are to be offered the costs will need to be artificially introduced through domestic price increases that the larger American market finds extremely unpalatable.

This is a failing where a lack of coordinated collectivized action was one contributing factor but there is actually a large collectivized will here - but I think the bigger issue is that it's having difficulty aligning itself in the current political environment.

I'm sorry, but this is completely wrong. California canning peach farmers are organized and crop prices are set by industry-wide bargaining with processors every year. Additionally, now that Del Monte is out of the business, the only remaining operating canneries are owned by a grower cooperative. It didn't save the industry. In fact, it may have led to the irrational planting of these trees that now need to be pulled. Source: my father was a peach farmer and chairman of the board of the California Canning Peach Association for many years. But he saw this coming and got out of the business.

Farmers generally own or lease their land. How and why would the owner or leaseholder of the land unionize? Who would they be negotiating with collectively? On the other hand, many farmers are parts of pools that pool their crops and sell them all into commodities markets.

I don’t think you have a clue what you’re talking about. And it’s a shame; unions actually deserve better representation than you just provided.

That's how we got mountain bunkers filled with cheese over the course of decades.

https://www.youtube.com/watch?v=kvLMH0wb_0k

Farmers are literally subsidized to over-produce for food security.

Uh yeah, this was Del Monte’s business model.

The issue is that the company that owns the canning plants (Del Monte) went bankrupt. There is no canning capacity available to do this.

How did you possibly miss the point by this far? It’s like trying to drive to Los Angeles and ending up on Pluto.

> What's missing in this analysis?

Tree maintenance labor, harvest labor, storage before shipping, labor to load the truck, labor to unload the truck, supermarket storage, supermarket shelf-stocking labor, supermarket disposal labor and cost for any stock that spoils.

That's for peaches intended to eat whole. The peaches we're talking about here are intended for canning, so you also have to add the cost of running the processing and canning machinery, the cost of the cans themselves, and the cost of labor to run and coordinate all that.

Also consider that no single supermarket is going to buy out the entire truck, so you're going to be stopping at many supermarkets, and unloading multiple times.

For larger chain supermarkets they may be buying a full truck (or multiple), but then you'll probably be delivering to a distribution center, where the supermarket then has to pay for that storage, plus labor to re-load onto other trucks, ship to the supermarkets themselves, and unload again.

Your analysis is missing nearly everything. Driving the full truck from point A to point B is a tiny part of the process, cost-wise. And I'm sure I've left things out too.

What‘s missing is considering why, if it were so easy, nobody has done that before they went out of business.

Sorting, selling, cleaning, the variety may not be palatable or presentable fresh, transport and packing damage, warehousing and storage (grocery stores don't have huge piles of fruit or even dry goods in the back, this stuff is all JIT)... probably missed a few, but that's just of the top of my head.

There are a number of costs and steps you forgot to consider. Plus, these peaches are for canning, but we’ll ignore that and assume they could be sold for eating raw.

The fruit needs to be picked. Paying people to pick it costs money.

As far as I know, you can’t just load 44 tons of peaches into a grain hopper trailer. It has to be loaded into crates, which are stacked and palletized and loaded into a refrigerated trailer. Possibly this is automated, but I’d bet it’s done by humans.

Food is generally not delivered from a farm directly to a grocery store, (ignore local co-ops buying from local farms for the purpose of this discussion, we have 44 tons of peaches inside our 53 foot trailer) fruit is stored in a refrigerated warehouse and it costs money to store it there whether you own the warehouse or pay someone else to store it in their warehouse.

A grocery chain will have (or rent/rent space in) warehouses where they receive large orders and then distribute them to individual stores, or they buy it from a local distributor that sells to multiple chains. Include unloading from the truck to the warehouse, which is faster than loading the fruit onto pallets, and picking the order in the warehouse to then be loaded onto another truck to be delivered.

Then, someone at the store has to receive the order, and then someone is assigned to stock the fruit on the sales floor, which occupies space inside the store which costs money.

All of your freight costs go up if you ship less than a full trailer (LTL).

You gave the LLM the wrong prompt. You probably asked something like “How much does it cost to ship 1000 kg on a semi-truck in the United States?” when you should’ve asked something like “Name all of the input costs for selling peaches, include all costs starting at harvest and ending at the customer purchasing the produce at the grocery store.”

Reality is missing from that LLM analysis.

Are there a lot of extra trucks and refrigerated trailers sitting around idle?

Millions of peaches, peaches for m̶e̶ no-one -> https://youtu.be/3GCrzjVdmSg

How do canned peaches cause Alzheimer’s?

Maybe, but it's not an argument against diversification. When it comes to agriculture, the incentives should be aligned such that a single point of failure like this is highly unlikely.

That's not to say it's an easy problem to solve.

And conversely you can't grow enough food local to a large population center to feed everyone.

And farmers that don't care about making money aren't farmers any more.

Agriculture is a highly competitive business - even large scale agriculture still has very stiff price competition. There isn't a lot of fat to burn on charitable gestures and what is there isn't on the scale of maintaining such a large unproductive orchard.

It sucks - don't misread my statement. It is deeply unfortunate and we should consider mitigations for the future - but the party to throw blame at here isn't the farmers and neither should they be expected to bear the cost.

This is rapidly changing. As almond orchards get taken over by corporate farmers instead of smaller family farmers, they just chip the almond wood and discard it instead of dealing with waiting for various people to come in and get the almond wood.

(Source: my relatives in the Sac. Valley don’t heat with almond wood anymore.)

> "carbs are recognized now as seriously unhealthy" is absolutely untrue

I don't think they meant that the medical community recognizes carbs as unhealthy. I think they meant the general public.

It's not true that carbs are unhealthy, but I think it is true that people recognize them as unhealthy.

True, but carbs are being vilified in the media right now, and have been for a while, so public opinion on them (and especially sugar) is very negative

> Same with fiber.

Really? The only issues arising from fiber that I've heard of is constipation, and that's only if diet suddenly changes and large amounts of fiber are introduced to a digestive system unused to it. AFAIK most people don't even get a tenth of what they should in terms of fiber.

Yes, i have no issue with that, but why is the money coming from the tax payer instead of del monte?

Thanks for your answers!

> Del Monte was killed by COVID. Canned food sales spiked and they thought that would last, but it didn't.

Why can’t they reduce to their former size? It seems the California plants had been around long before Covid

This. They'll be edible, but we don't have a fresh peach shortage, so you don't really want these peaches.

it's worth mentioning that this isn't a produce/fruit only thing. Dairies regularly dump milk when it isn't profitable, often in ways where it winds up in the ground water or watershed.

Reminds me of Steinbeck:

“The works of the roots of the vines, of the trees, must be destroyed to keep up the price, and this is the saddest, bitterest thing of all. Carloads of oranges dumped on the ground. The people came for miles to take the fruit, but this could not be. How would they buy oranges at twenty cents a dozen if they could drive out and pick them up? And men with hoses squirt kerosene on the oranges, and they are angry at the crime, angry at the people who have come to take the fruit. A million people hungry, needing the fruit- and kerosene sprayed over the golden mountains. And the smell of rot fills the country. Burn coffee for fuel in the ships. Burn corn to keep warm, it makes a hot fire. Dump potatoes in the rivers and place guards along the banks to keep the hungry people from fishing them out. Slaughter the pigs and bury them, and let the putrescence drip down into the earth.

There is a crime here that goes beyond denunciation. There is a sorrow here that weeping cannot symbolize. There is a failure here that topples all our success. The fertile earth, the straight tree rows, the sturdy trunks, and the ripe fruit. And children dying of pellagra must die because a profit cannot be taken from an orange. And coroners must fill in the certificate- died of malnutrition- because the food must rot, must be forced to rot. The people come with nets to fish for potatoes in the river, and the guards hold them back; they come in rattling cars to get the dumped oranges, but the kerosene is sprayed. And they stand still and watch the potatoes float by, listen to the screaming pigs being killed in a ditch and covered with quick-lime, watch the mountains of oranges slop down to a putrefying ooze; and in the eyes of the people there is the failure; and in the eyes of the hungry there is a growing wrath. In the souls of the people the grapes of wrath are filling and growing heavy, growing heavy for the vintage.”

Ah so the real problem here is the loneliness epidemic. If yall were less shy and came over more often to share my home baked peach cobbler then this wouldn't be an issue!

this is exactly right, all US farmers are basically socialists and they consistently vote for the one of the most socialists parties on the planet - the republican party

Exactly.

(I wonder why my comment has been deleted)

Did Del Monte's investors and lenders lose money? It would be strange if they didn't.

The topic at hand is market forces demanding the destruction of agricultural products. The horror of that seems very topical to me.

It's really not. https://droughtmonitor.unl.edu/

California is not in any drought right now and our reservoirs last 10 years in the absolute worst case. Most of our water goes into the ocean.

I have no dog in the race in terms of what trees there are but if you take them down it'll be invasive South American pepper trees or mustard grass. As long as it's used and sequestering carbon it's all gravy.

Covid boosted the sale of canned food, but people avoid the sugary syrup of canned fruits in non emergency situations.

Why would they pay to ship it anywhere? Set the auction date and mandate the buyer brings a flatbed. All sales final. The work to remove the dead tree stump isn't going to be cheaper.