Article

Deep freeze

Winter's big chill has made produce prices ice cold.

June 4, 2007

** This article appears in the June/July issue of Fast Casual Magazine.Click hereto subscribe.

How do you make a salad without lettuce?

It's a question Carl Griffenkranz, vice president of operations and brand leader for Doc Green's Salads & Grill, has been pondering lately.

The mid-January freeze that swept through much of California inflicted heavy damage on crops of lettuce, broccoli, onions and avocados.

Due to the buying power of Doc Green's, Griffenkranz said it never got to the point where they ran into serious shortages, but given the severe weather across the nation this year it's something they need to prepare for.

"It's unexpected but inevitable that there will be some Mother Nature crisis every year," Griffenkranz said. "Two years ago, we had the hurricane take out the tomato crop in Florida; this year we're experiencing a drought in the Southeast. We had a late freeze in the apple world that maybe wiped out 70 percent of the crop, and in California we had the lettuce. So you have to plan on something going wrong once per year."

In Florida, a drought has affected citrus and sugar cane crops as well as cattle, said Terence McElroy, spokesman for the Florida Department of Agriculture and Consumer Services. In 2001, the state went through a similar drought and suffered more than $400 million in damages.

"It's a serious problem and if it lasts another month or six weeks it will be very serious," McElroy said.

The big chill

In California, things went seriously wrong for the 6,500 California avocado farmers, said Guy Witney, director of industry affairs for the California Avocado Commission. The cold freeze destroyed more than 25 percent of the avocado crop, dropping its estimated yearly output from 400 million pounds to 270 million pounds.

"It will be extremely tough for many growers," Witney said. "There are tough financial times ahead, tough times for the whole community. Avocados are the basis for much of the economy in some of these towns, and it might take a couple of years to recover."

Such losses to all types of crops throughout California drove up produce prices for Doc Green's by as much as 20 percent, Griffenkranz said. Cases of romaine lettuce and broccoli jumped $5 to $6, and the price of some items rose as much as 50 percent.

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"Our philosophy is, if it's a short term occurrence, less than 90 days, suck it up," Griffenkranz said. "We talk to our franchisees and say you have to absorb it. If we lost a crop for 10 months, then you have to look at reworking the menu and removing an item all together, or price increases for the customer. But we're almost back to where we were on our prices, so we weathered the storm."

In the last two years, Doc Green's hasn't had to take anything off its menu because of weather-related shortages, but it came close in 2005 when hurricanes severely damaged Florida tomato crops. The quality was poor and the prices were high, but Griffenkranz said they waited a few weeks before making the final decision to eliminate the item from the menu. Eventually, tomatoes started coming in from Mexico and other regions.

"We just kept buying whatever tomato was available," he said. "It's hard when tomatoes are in your top five toppings on salads and sandwiches to turn around and tell customers you don't have tomatoes."

Griffenkranz said when he worked for Moe's Southwest Grill twice the company had tomato crises.

"How do you have a restaurant that depends on pico de gallo, without tomatoes? Do you can have onion de gallo or something? If you literally can't get product, you have to apologize profusely to your customers. They'll complain and be unhappy and some people will say unkind things, but most of the time they're OK."

Fast Facts

	Lettuce, a member of the sunflower family, is one of the oldest known vegetables and is believed to be native to the Mediterranean area.
	In the United States, lettuce ranks second only to potatoes as the most popular vegetable.
	Average U.S. consumption in the 1990s was 30 pounds of lettuce per person per year. * Source: Dixie Food Co.

Kathy Means, vice president of government relations for Produce Marketing Association, said the group has experienced severe weather in all parts of the country but the effect on the customer has been limited.

"It's been devastating to growers, but going to a supermarket or restaurant we won't see as much a problem. If there's a price increase, it will be a very small amount but will never get to point where it's so high the consumer couldn't afford it. The retailer would stop carrying the item at that point. One thing about the produce industry is it's a global industry and retail and food operators do look to other supply areas, whether domestically or import, to fill in a need."

Witney said he is all for giving foreign growers a place at the table, but the avocado industry is extremely worried about the importation of harmful insects. Pests from Mexico were imported into California in the 90s, causing between $10 million and $15 million in damages per year before exploding last year with more than $60 million in damages to the avocado crop.

"We're talking about a 350-million-pound crop," Witney said. "One single pest can cause that much damage, from San Luis Obispo down to San Diego. It makes us very nervous when we see large volumes of fruit moving into the U.S. domestic market."