YAKIMA, Wash. — Twenty years ago, the Washington apple industry suffered from too few varieties.

Consumers said they were tired of Red and Golden Delicious, which dominated the manifest of about a half-dozen varieties.

Today, the industry suffers from too many varieties, several speakers told the 116th annual meeting of the Washington State Tree Fruit Association on Dec. 7.

“There’s too many options of new varieties. Too many have similar flavor profiles. It’s simply confusing,” said Randy Riley, co-owner of Golden Sun Insights and former produce director for the retail giant Kroger.

Consumer trends analyst Phil Lempert, known at the “Supermarket Guru,” agreed.

Too many apple choices causes consumers to turn to grapes, berries and citrus for convenience and ease of eating, Riley said.

The total U.S. apple volume sold, across all retailers, shrank 11% from 2014-15 to 2018-29, he said.

One of the problems: the industry is too slow to remove old varieties, he said.

Gala, Granny Smith, Fuji and Honeycrisp made up 75% of production last season out of more than 50 varieties, Riley said.

An unknown, he said, is how consumers will react to a massive influx of more Cosmic Crisp apples in the next few years.

Jill McCluskey, a Washington State University agricultural economist, said Cosmic Crisp is poised to have a “very negative” effect on Gala, Granny Smith, Fuji and Honeycrisp. She showed results of a 2008-2018 study on the price elasticity of 21 varieties.

Karina Gallardo, a WSU economist, said the 2019 costs of production, including growing, packing and marketing, ranged from $30,611 per acre for Honeycrisp to $33,947 for Fuji. She said breakeven costs, excluding taxes and insurance, were $26.91 FOB per 40-pound box for Gala, $26.93 for Granny Smith, $26.99 for Fuji and $41.86 for Honeycrisp.

Riley said industry investments should be consumer, not yield, driven, that innovations beyond varieties and operational efficiencies are needed and that partnerships should be formed with industries of similar objectives.

A good partner would be someone in e-commerce, he said, because no one else in produce is doing that well and online grocery shopping is expected to grow 15 times faster than in-store shopping over the next five years.

Brian Focht, manager of the Washington Apple Growers Marketing Association, said growers need to pick the best 120 million to 125 million boxes of apples and leave the rest in the field.

“Last year, we sold 27 million boxes, out of a 134-million-box crop, at less than $15 per box,” Focht said. “We need to eliminate some of that fruit one way or the other whether we take it out (from packing lines) or leave it out in the field.

“Our current demand model will not support more than 125 million. There is an economic equation that would suggest for every million boxes we harvest over that, we deflate FOB pricing 6%,” he said. “There are too many variables to consider this as fact but it’s an interesting number, nonetheless.”

However, Jon DeVaney, president of the Washington State Tree Fruit Association, said variability in pricing suggests there is room to grow apple sales and that there isn’t a ceiling on demand.

DeVaney, Focht, Riley, McCluskey, Lempert and Gallardo all spoke during the virtual meeting.

Reacting later, Desmond O’Rourke, a retired WSU agricultural economist and world apple analyst, said per capita consumption can be increased with lower prices or collective domestic promotions, both of which many industry leaders oppose.

“Shrinking volume is easy. You just pull out trees. However, it is painful and everyone is hoping the other guy will do it,” O’Rourke said.

Added costs from COVID-19 restrictions, H-2A visa guestworker regulations and the Food Safety Modernization Act also squeeze profitability, he said.

The Washington apple industry shipped 116.7 million boxes of apples in 2018-19 for a total FOB revenue of $3.044 billion, O’Rourke said. Preliminary estimates suggest it shipped 134.3 million boxes in the 2019-20 sales season for $3.128 billion, he said.

“So 15% more shipments increased FOB value by 2.8%,” he said.

Assuming average packing and marketing costs of $14.50 per box, grower value would have been $1.352 billion in 2018 and $1.181 billion in 2019, a decline of 12.6%, O’Rourke said.

“It is difficult to estimate profitability because grower costs per box should be lower in a large crop year as fixed costs are spread over more tonnage,” he said. “However, there is no doubt that grower revenue will be higher at lower volumes.”