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Cornelius hazelnut business going nuts

Once threatened by disease, crop is getting healthier as demand rises in Washington County


by: CHASE ALLGOOD - Steve Heesackers orchards near Forest Grove have stood the test of time and are now part of the industry-wide upswing.For the first time in decades, Oregon hazelnut farmers can step into their orchards with the hope that the fruits of their labor will pay off.

Hazelnut orchards, once serene with their shaded canopies and tasty yields, turned to a place of turmoil and worry for many 40 years ago, when disease began threatening Northwest trees and some farmers were forced to destroy their livelihoods with their own hands.

Eastern Filbert Blight proved to be a monumental struggle for the industry back then. It's easily spread through spores during wet weather periods and eventually strangles trees if left untreated. In the 1970s, as farmers with infected trees sprayed and pruned out the disease, many had to watch their orchards shrink before their eyes.

Now the industry is bouncing back, and millions of hazelnuts — which are shipped all over the world — start their journey in Cornelius.

Hazelnut Growers of Oregon, a co-op just a few miles east of Forest Grove, supports more than farmers and the community — it sustains a way of life and an Oregon tradition.

Established in 1984, the co-op grew steadily and now accepts nuts from about 140 growers, bringing in 20 million pounds of hazelnuts and $35 million in revenue last year, a significant portion of Oregon’s $70 to $90 million per year industry.

There’s plenty of evidence to show hazelnuts are making a comeback in western Washington County. At the end of 2012, Hazelnut Growers of Oregon posted a 25 percent increase in sales from the 2011 holiday season. That, coupled with a steadily-growing demand and a crippling crop disease that’s finally under control, the industry’s future looks brighter than ever.

But a long, uncertain road brought growers and industry professionals to this point, and all their struggles aren’t over yet.

On the upswing

The holiday season is the co-op’s busiest time, according to Jeff Fox, CEO of Hazelnut Growers of Oregon, the largest hazelnut packer in the state.

With demand exceeding supply the last few years, the industry is on the upswing. Existing growers and hopeful orchardists alike are planting more trees — about 3,000 acres per year, Fox said.

“If we had more hazelnuts come in to sell, we’d be able to sell them,” said Fox. “We’re helping the trade deficit,” employing about 50 workers and “providing a better value and higher profits to growers.”

The co-op focuses on food safety, sterilizing hazelnuts at its facilities and sending all items to be individually lab-tested prior to shipping. The crop — a flavorful, vitamin-rich food without cholesterol and shells that can be burned as a fuel source or used for landscaping — is growing in popularity. Although it is typical for hazelnut farmers crops to vary significantly from year to year, the state's industry has been growing steadily. Oregon farmers sold more than 15,000 tons of hazelnuts in 1980, but that number grew to 21,500 tons in 1990. High points came in 2001, when the state sold almost 50,000 tons. and in 2009, when 47,000 tons were sold.

Hazelnut Growers of Oregon sells hazelnuts in almost every form: sliced, diced, salted, roasted — and in butters, pastes, spreads, breads and cookies. But the lion’s share of its sales are from whole hazelnuts still in the shells, which are especially popular with foreign customers. Oregon produces more hazelnuts than any other state, exporting much of the crop to other nations with an increasing appetite for the food.

Fight with blight

Producing more nuts is finally feasible for growers after years of struggling with Eastern Filbert Blight. A new study released last month by Oregon State University details the effectiveness of a new hazelnut tree cultivar called the Jefferson, which has won praise from growers as a blight-resistant variety yielding stellar in-shell results.

A cultivar is a plant or grouping of plants selected for desirable characteristics that can be maintained by propagation.

With the advent of the Jefferson, a variety produced by selective breeding, it appears Northwest hazelnut growers can finally rest easier.

Jay Pscheidt, an OSU plant pathologist, has been studying Eastern Filbert Blight in Oregon hazelnut orchards for years. The Jefferson, released by OSU in 2009 and highly resistant to EFB, seems to be the saving grace for growers who had the majority of their orchards destroyed by cankerous sores.

After studying Jeffersons south of Forest Grove and throughout the Willamette Valley, most growers did not report any problems. But in 2010 three growers found cankers, which threatened the industry once again. One grower found only one canker in 25 acres while another discovered that 3 to 5 percent of his trees were infected. OSU researchers found that some small cankers had grown to eight inches in diameter by winter of 2011.

But after reviewing the trees last fall, Pscheidt reported that in the small percentage of trees that had cankers, 80 percent of the cankers had healed completely or shrunk significantly, and only 20 percent grew, restoring hope once again.

Jeffersons naturally resist the disease, holding it in check while trees grow and their wounds heal over.

The Newberg orchard was surrounded by infected Barcelona and Ennis cultivars — making it a worst-case scenario for healthy trees — but proved the Jefferson effective by keeping the disease under control when any other variety would have likely suffered more dire effects.

"This is a success story for the hazelnut industry," Pscheidt said.

A million pounds

Steve Heesacker fills 325 acres about five miles northwest of Forest Grove with hazelnut trees, planting about 100 trees per acre. Last year was an average one for Heesacker, whose orchard produced close to one million pounds of hazelnuts.

Heesacker took over the family business after growing up under the shade of hazelnut trees. His dad, Joe, was a founding member of the Hazelnut Growers of Oregon.

“It delivers the highest return compared to the rest of the industry,” Heesacker said.

His trees, ranging from one to 90 years old, have weathered the ups and downs of the industry. Restoring orchards to their former health isn’t easy, fast or cheap, and the threat of EFB isn’t obliterated — but the necessary investments to continue in the business are paying off for many.

Like all filbert farmers, Heesacker has struggled with EFB, but so far, none of his Jefferson trees have developed cankers, allowing the trees to flourish and reach their potential production instead of getting weaker and smaller because caretakers have to continually prune out the disease.

Still, there are threats to the hazelnut industry that exist outside the problem of blight: focusing on foreign markets is a risk, producers say. If currently strong foreign economies stumble or the dollar exchange becomes unfavorable for the U.S., hazelnut farmers and processors will likely encounter problems.

Currently there is a tariff on American hazelnuts being imported into China, but Chile is selling their increasing production to China tariff-free. In addition, China is also working on planting their own hazelnut crops. That’s why, with about 60 percent of exported Oregon hazelnuts traveling to China, those in the industry are trying to expand foreign markets to ensure they can maintain their hard-earned stability in the future.

Fox said they're also are working on diversifying their markets. “Having all your eggs in one basket is a big foreign trade risk. We ship to Europe, Asia, Southeast Asia, South America and New Zealand. Our overall percentage of sales to China are decreasing as our sales to other countries and domestically increase,” he said.




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