Oil, Onions & Other Tidbits

This spring season was a mixed bag. Depending on which part of the country you’re in, Mother Nature was either very kind or very temperamental. For the most part, growers reported sales were especially good during the good weather and surprisingly strong otherwise.

The same could be said about the country economically, as well. Some areas of the country continue to recover from the economic downturn nicely and others are progressing slowly, if at all. Some improvements in the labor and housing markets have been experienced this year, but not as quickly as some had hoped.

Much attention has been placed on oil prices and their supposed influence on consumer purchases. However, a recent study debunked this notion, finding that consumer purchases of other discretionary items are less influenced by gasoline prices than originally thought. Instead, they tend to substitute regular gasoline for premium when prices rise above their tipping point. But these findings are not dissuading the government from scrutinizing the role that speculators may have played in driving up fuel and food prices. Still, the investigators may want to take a look at price swings in a commodity, not in today’s news such as onions!

The Importance Of Supply & Demand

According to a recent article in Fortune, the bulbous root is the only commodity for which a futures market is banned. Back in 1958, onion growers convinced themselves futures traders were responsible for falling onion prices, so they lobbied an up-and-coming Michigan congressman named Gerald Ford to push through a law banning all futures trading in onions. The law still stands.

And yet even with no traders to blame, the volatility in onion prices makes the swings in oil and corn look tame, reinforcing academics’ belief that futures trading diminishes extreme price swings.

Since 2006, oil prices have risen 100 percent, and corn is up 300 percent. But onion prices soared 400 percent between October 2006 and April 2007 (when weather reduced crop yields), only to crash 96 percent by March 2008 on overproduction and then rebound 300 percent by this past April.

OK, so why am I spending the time to write about onions? First, to illustrate that, left unchecked, the effects of supply and demand in determining prices can be quite volatile. Second, to make the more subtle point that these price swings would not occur if onions were not a staple purchase in consumer lives. If they weren’t, folks would simply substitute something else for onions when the price got too high. But what else would go so well with that nice juicy cheeseburger?

No, people don’t stop buying onions just because they cost a bit more and that’s a lesson we in the green industry should contemplate once more. People afford what they want and we need them to want roses and zinnias and daylilies and dracaena in the same way they want onions. In other words, and you’ve heard this before, we need consumers to view our products and services as necessities instead of mere luxuries – and we do this by emphasizing the economic, environmental and health benefits of what our industry offers. Be sure to check out the America in Bloom website and my Making Cents blog for more on that subject.

To Be Successful

Through the years I have heard sage advice from various industry leaders, consultants and motivational speakers that pontificated on various keys to success. However, I recently read a blog post that struck a chord as soon as I read it. The blogger was talking about the top 10 things we should be teaching high school students today, but if you review the list, I think you’ll agree it fits what we should be training our greenhouse employees as well:

  1. How to focus intently on a problem until it’s solved.
     
  2. The benefit of postponing short-term satisfaction in exchange for long-term success.
     
  3. How to read critically.
     
  4. The power of being able to lead groups of peers without receiving clear delegated authority.
     
  5. An understanding of the extraordinary power of the scientific method, in just about any situation or endeavor.
     
  6. How to persuasively present ideas in multiple forms, especially in writing and before a group.
     
  7. Project management. Self management and the management of ideas, projects and people.
     
  8. Personal finance. Understanding the truth about money, debt and leverage.
     
  9. An insatiable desire (and the ability) to learn more. Forever.
     
  10. Most of all, the self reliance that comes from understanding relentless hard work can be applied to solve problems worth solving.

Heck, now that I’ve reviewed the list again, I think it applies to all of us.

Leave a Reply

2 comments on “Oil, Onions & Other Tidbits

  1. Great article Charlie. Always providing legitimate insight for the industry. Greenhouse Grower…you need a share option for Twitter on all articles. I don’t see it if it’s here.

More From Finance/Operations...
Ball ColorLink logo

July 11, 2017

Get Guidance on Running Your Business from Ball ColorLink at Cultivate’17

Representatives from Ball ColorLink will be on-hand at Cultivate’17 to answer questions and present business-building tools and industry insights to growers.

Read More
Lean Consortium in Washington

July 10, 2017

Washington Growers Join New Horticulture Lean Consortium

The group of growers has committed to learning and applying the principles of Lean, a method for eliminating waste that results in more value to customers delivered at a lower cost, in a shorter time, with fewer defects and less human effort.

Read More

April 11, 2017

Jerry Halamuda of Color Spot Nurseries Retires

The co-founder of Color Spot Nurseries has retired, effective immediately, and has named a replacement.

Read More
Latest Stories
Ball ColorLink logo

July 11, 2017

Get Guidance on Running Your Business from Ball ColorLi…

Representatives from Ball ColorLink will be on-hand at Cultivate’17 to answer questions and present business-building tools and industry insights to growers.

Read More
Lean Consortium in Washington

July 10, 2017

Washington Growers Join New Horticulture Lean Consortiu…

The group of growers has committed to learning and applying the principles of Lean, a method for eliminating waste that results in more value to customers delivered at a lower cost, in a shorter time, with fewer defects and less human effort.

Read More

April 11, 2017

Jerry Halamuda of Color Spot Nurseries Retires

The co-founder of Color Spot Nurseries has retired, effective immediately, and has named a replacement.

Read More

March 21, 2017

How Greenhouse Vegetable Growers Can Prepare for a Prod…

The United Fresh Produce Association is holding a Recall Ready Workshop in April that is designed to help growers properly manage a recall, from liability to communications.

Read More

March 14, 2017

Expanded Customer Footprint, E-Commerce, Succession Key…

Costa Farms' acquisition of indoor foliage producer Delray Plants rocked the industry, but the story behind Delray Plants' sale is the same as for many growers struggling with succession planning. For Costa Farms, the strategic purchase expands its customer footprint and also fast tracks its foray into e-commerce.

Read More

March 10, 2017

Costa Farms Expands With Purchase of Indoor Houseplant …

Costa Farms annnounced March 10 that it has acquired Delray Plants, one of the leaders in the indoor houseplant industry. The two operations are committed to the same values, principles, and goals to grow the industry, and will fit well together to accomplish this, say Randy Gilde, CEO of Delray Plants, and Joche Smith, CEO of Costa Farms.

Read More
Ken and Deena Altman

March 7, 2017

Altman Plants in Escrow to Purchase EuroAmerican Propag…

Ken Altman, a co-owner of Altman Plants based in Vista, CA, has confirmed that the operation is currently in escrow to purchase EuroAmerican Propagators, the Bonsall, CA-based young plant and finished plant grower that filed Chapter 7 Bankruptcy on Jan. 23, 2017. Ken and Deena Altman are co-owners of Altman Plants and The Plug Connection, along with their son Matthew, who has recently bought into the family business. The 55 acres of land and all of the facilities on it, which were previously owned by Jerry Church, a partner in EuroAmerican Propagators, are part of the purchase agreement currently in escrow, Altman says. However, it would not be absorbed by Altman Plants, which in 2016 was number 3 on Greenhouse Grower’s Top 100 Growers list with more than 11 million square feet of environmentally controlled greenhouse production, 62 acres of shade production, and 400 acres of outdoor field production. Altman Plants’ property […]

Read More
EuroAmerican Propagators Greenhouses

February 14, 2017

Suppliers Comment on Plant Genetics’ Fate After EuroAme…

Since the operation’s bankruptcy filing on January 23, 2017, suppliers associated with EuroAmerican Propagators have updated Greenhouse Grower on what the operation’s bankruptcy means for them – and how it will impact grower customers.

Read More
Stephanie Whitehouse

January 17, 2017

Stephanie Whitehouse Takes Her Passion for Plants to Di…

Stephanie Whitehouse, who has spent the last seven years as the Sales and Marketing Director for Peace Tree Farm in Kintnersville, PA, recently joined Dickman Farms Greenhouse and Garden Center in Auburn, NY, as the company’s new Retail General Manager.

Read More
Laura Drotleff

December 6, 2016

Are You Driving Young Growers Away? [Opinion]

In a time when the industry is facing a critical shortage of both labor and skilled, educated growers, it's important that grower operations don't unwittingly turn candidates off to a career at their business or in the industry in general. Take a closer look at your hiring practices to ensure you are being inclusive and not breaking any laws.

Read More
Trays move on an overhead conveyor to the end of the production line, where workers carefully pack the cleaned, sized, graded, counted and sorted Calla tubers

November 29, 2016

Texas Judge Halts Overtime Rule; Here’s What It Means F…

According to Craig Regelbrugge at AmericanHort, the injunction against the overtime rule is welcome news for horticulture.

Read More
Craig Regelbrugge, senior vice president of AmericanHort - Feature image

October 25, 2016

Contribute To HRI To Help Honor Industry Advocate Craig…

In honor of Craig Regelbrugge's extraordinary contributions to the horticultural industry, AmericanHort and the Horticultural Research Initiative created a special HRI endowment fund in his name: "The Craig Regelbrugge - Advocates for Horticulture Fund."

Read More
Lucas Greenhouses Shipping

October 6, 2016

Greenhouse Shipping Costs Down, But Concerns Remain

Lower gas prices have led to lower shipping costs for some growers, but many continue to seek out ways to become more efficient.

Read More
Pansy ‘Cool Wave Blue Skies’ (Wave)

September 20, 2016

PanAmerican Seed Settles Alleged Trade Sanction Violati…

PanAmerican Seed, a division of Ball Horticultural Co., has been charged with violating trade sanctions to Iran over a number of years. According to a release from the U.S. Treasury department, PanAmerican Seed made 48 indirect sales of seeds to two Iranian distributors. The company shipped the seed to consignees based in countries in Europe and the Middle East. PanAmerican Seed’s customers then arranged for the re-exportation of the seeds to Iran. The release states that the Office of Foreign Assets Control (OFAC) determined PanAmerican Seed did not voluntarily self-disclose the alleged violations to OFAC, constituting an egregious case. “We believe that the settlement was extreme; however the alternative was to litigate with the U.S. government, which would take months, if not years,” says Todd Billings, Chief Financial Officer for Ball Horticultural Co. When asked what Ball Horticultural Co. has done to ensure that violations to trade sanctions do not […]

Read More
young-plants

September 20, 2016

The Top Young Plant Growers, And Four Critical Challeng…

In Greenhouse Grower’s 2016 Top Young Plant Growers Survey, growers discuss the latest challenges and opportunities in fulfillment, shipping, labor, and crop protection.

Read More
Cavicchio Greenhouses

September 6, 2016

Cavicchio Greenhouses Wins Inaugural Sustainability Awa…

The Sudbury, MA, growing operation sustains more than 250 acres of annuals, perennials, and nursery stock, with a number of practices to mitigate its impact on the environment.

Read More
Charlie Hall Feature Image

September 6, 2016

10 Insights From Charlie Hall’s Green Industry Economic…

With the uncertain current economic climate, Texas A&M economist Charlie Hall says now may be the perfect time to invest — as long as you do it smartly.

Read More
Penn State Plant Bud

August 23, 2016

AmericanHort Is Helping Plant Importers Adjust To New R…

A report from Craig Regelbrugge at AmericanHort says the government is implementing a streamlined system for imports, in which all required data will be submitted electronically through a single window.

Read More