Helping growers succeed
In the mid-’90s, the price to growers for certified perennial ryegrass seed in Oregon was 41 cents per pound. It had been going down for years from previous highs, and fluctuated wildly. Many growers found a way to correct that; in 1994, they formed a cooperative that would bargain for them. Now, the price is 68 cents for their premium seed, and fairly stable from year to year.
The Perennial Ryegrass Bargaining Association (PRBA) in Oregon has turned around the price of co-op members’ crops and has generally raised the price of seed to all ryegrass growers in the state. That might not have been the ideal pricing situation for seed dealers or end turfgrass users, but it has had some beneficial effects both locally and nationally, according to PRBA Executive Director Ralph Fisher.
|Growers of perennial ryegrass in Oregon, which produces most of the U.S. crop, have raised and stabilized prices by forming the Oregon Perennial Ryegrass Bargaining Association.|
“I don’t think fluctuating prices are good for the buyer or the seller,” says Fisher. Prior to the establishment of the cooperative, there was a lot of market uncertainty, he points out, with ryegrass growers not knowing what price to expect or how much acreage to plant. Seed dealers unilaterally set the price, and in the ‘90s, according to the PRBA, that price was as much as 7 cents below production cost. That has all changed, and the dealers and turf growers now pay more, but can also count on astable market from year to year.
The association was organized by 90 growers representing 28,000 acres of perennial ryegrass seed production. At first, the association bargained only with individual seed dealers, one by one. It took an act by the state legislature clarifying federal antitrust implications to allow the PRBA to bargain with seed dealers as a whole. That legislation came into effect in 2000, and the following year was the first in which both sides negotiated as units, with dealers electing a bargaining committee among representatives from the various seed companies. The Oregon Department of Agriculture supervises the sessions.
Oregon grows the bulk of the U.S. perennial ryegrass seed, and now the association boasts about 140,000 acres of crops and 150 members. That is about a third of the perennial ryegrass acreage grown in the state, which is also a big producer of annual ryegrass, as well as tall and fine fescues. Fisher himself is a fine fescue grower who is renting out most of his acreage this year to take on the executive director’s position.
|Most of the approximately 150,000 acres of perennial ryegrass grown in Oregon is in the lush Willamette Valley.|
Fisher says that this is a fairly typical cooperative, with members paying no entry fee, but contributing $3 per acre of grass seed grown. This is all turf-type perennial ryegrass grown in many varieties to suit the needs of individual companies. Most of it, he says, is used for overseeding in the desert Southwest, and all is grown under contract to the approximately 30 seed dealers in the Willamette Valley.
The cooperative has facilitated the contract process for both sides, Fisher says. The association holds one or two talks with the dealers’ bargaining group, supervised by the state, and the ultimate price agreement is binding for all member growers. The co-op provides a contract that each grower can use with the company he grows for, though the PRBA does not sign any agreements itself.
“The companies don’t have to negotiate with every grower. It benefits both sides.” Fisher says that the procedure has become so standard for the industry that the PRBA member price has become sort of the benchmark price for all growers now. Even nonmembers have benefited. That can be handy for the dealers, because a company may have growers who are members and growers who are not.
The association conceived another marketing coup that benefits only its members. It created a super-premium turfgrass seed line, TournamenT Quality, that goes beyond regular certified seed in quality and purity. The varieties in this line must test to a 90 percent germination rate and be free from the normal contaminating grass seeds, as well as Poa annua and noxious weeds.
“It was targeted for the overseeding of golf courses” in the Southwest, Fisher says of the TournamenT Quality seed. Some is sold to other users, but homeowners and other overseeders don’t necessarily want to pay more for the ryegrass seed mixes normally used for those turf venues. The extra-premium seed has also given members a boost during the last two years, when there has been a surplus of regular certified seed.
The TournamenT Quality seed gives the association members, who are the only ones allowed to contribute to the program, about a 3-cent premium above the regular certified price, Fisher says. Of course, the growers must go to some extra effort, especially in controlling weeds, to achieve this quality. They will lose some of their 68 cents in other costs, such as transportation.
Although Fisher notes that association members’ prices for TournamenT Quality seed are higher than for the seed of growers not in the co-op, the general price for certified perennial ryegrass seed in Oregon is about the same for members as for nonmembers. In other words, he says, the formation of the bargaining association has led to higher prices for all of the state’s growers, and it has been a stabilizing influence on the marketplace all the way to the golf course.
Fisher says that perennial ryegrass crops in Oregon are planted from late September through October. They are fertilized and sprayed for weeds in the fall, with more fertilizer applied in the spring. To achieve TournamenT Quality, growers may have to rogue the fields to remove hard-to-kill weeds. In July, the grass is swathed and windrowed for additional drying, and then harvested with a conventional combine. The remaining straw is either mulched and returned to the soil or baled and exported to Japan or Korea for livestock feed.
The association is taking on something of a new role nowadays, Fisher says. In addition to promoting and advertising its premium seed, it is becoming more of an informational and networking organization. He spends more time talking to growers in other parts of the world—Canada and Europe also have perennial ryegrass production—as well as talking to the companies that buy seed. Those might be small, local companies or large, national ones.
|Perennial ryegrass is planted in the fall in Oregon, then swathed in June (as in this photo) and harvested with an agricultural combine.|
By networking with companies, and even the turf managers who use the product for overseeding, the association is able to get a more exact idea of market needs and trends. In addition to annual bargaining meetings with seed dealers, the co-op is now trying to hold a couple of meetings where both sides talk about company needs and trends in the industry. It’s another effort to iron out uncertainties in the marketplace.
“Growers want to make sure the end users are happy,” Fisher says. He’s making an effort to monitor what types of seed are requested and why. It also helps growers look at the future. As the prices of other area crops, such as wheat, rise dramatically because of national demand, ryegrass growers are able to better position themselves and their cropping patterns in the international marketplace.
For example, there is a trend toward using tall fescues instead of perennial ryegrass in some overseeding operations. Because the market may be shifting somewhat to these more drought-tolerant grasses, the association is considering whether to broaden its scope and include tall fescue growers as members. That would also broaden the association’s geographic range, because most of the perennial ryegrass seed is grown in the central Willamette Valley, while tall fescues are grown in other parts of the state.
The benefits of this organization have become pretty widespread by raising and stabilizing prices of perennial ryegrass seed, but there may be even more of a role in the future as the PRBA becomes what Fisher calls a growers’ advocacy group.
Don Dale is a freelance writer and a frequent contributor. He resides in Altadena, Calif.