25 Nov

Grupe and others try to revive production of oil in California

Fritz Grupe hopes to prove the rebirth of olive-oil production in California with his new olive orchard at his Lodi home and property

Text by Reed Fujii,
Picture : Michael McCollum/The Record,

Fritz Grupe, perhaps best known as the Stockton builder of Brookside and other major projects, never planned to get into land development.

He recently recalled that as a college junior he told his father: “I want to be a farmer. I have no interest in real estate.”

But after graduation and joining his dad in working the family’s 250-acre spread, it soon became apparent that the ranch was too small to generate enough money.

“That wasn’t enough to make a living, so I moved to town and became a real estate agent,” Grupe said.

Now, nearly five decades later, the farmer leads a real estate empire that encompasses commercial, apartment and single-family home construction – having created 10 master-planned communities and more than 50,000 homes in 35 cities nationwide since 1966 – real estate brokerage and property management.

But he’s also remained in agriculture, raising Angus breeding stock, cherries, apples and winegrapes. And his latest venture – cultivating 220 acres of olive trees – is part of a new agricultural trend that he and others hope will prove the rebirth of olive-oil production in California.

Their competitive edge: dense, vineyard-style plantings that will allow mechanical harvesting of a crop that, in other parts of the world, is still largely picked by hand.

“I’m excited about it,” Grupe told a recent visitor to his Lodi-area orchard.

“For the last few years, nothing has convinced me it was worth getting rid of those cows,” he said, referring to his Angus herd. He kept cattle on the land even though it was potentially more valuable for other crops and costly to irrigate year-round to maintain as pasture.

“It’s been the first time I’ve been convinced it’s financially feasible to plant a new crop,” Grupe said.

So he’s moved the cattle to less-costly pastures, spent about $7,000 per acre in olive seedlings and wire trellis and is betting he’ll begin to see a return on operating costs in about four years.

The key to the new olive-oil industry is choosing olive varieties that lend themselves to what is called super-high-density planting and allow the fruit to be picked by grape harvesters, said Jeff Colombini, president of Lodi Farming, which has about 350 acres of olives under cultivation.

Olives are gathered in November, following the September-October winegrape harvest season.

Naturally dwarfing varieties of olives are planted in rows with about 5 feet between trees and 13 feet between rows. The trees are trained to a trellis and trimmed to a maximum 7 feet high.

“It ends up looking like a tall vineyard,” Columbini said.

His fruit, as well as olives from Grupe and other growers, go to a new mill built by an associated company, Corto Olive Co.

“We can be a lower-cost producer if we machine harvest vs. hand harvest,” Columbini said.

California has an ongoing industry producing olives for table use, but couldn’t compete in producing oil, said Paul Vossen, a specialty and tree crop adviser with University of California Cooperative Extension.

“The limitation has always been the high cost of hand harvesting … particularly with the subsidies the Europeans were giving their olive growers,” he said. Europe produces about 90 percent of the world’s olive-oil supply.

But there’s reason for optimism that the new super-high-density approach will work, particularly as Europe phases out its subsidy system.

“The market’s wide open,” said Vossen, who works out of Sonoma County. “We produce a very small percentage, not even 1 percent, of what we consume in the United States of olive oil. We can produce with this new system top-grade oils for about that same price (as Europe). So, from a marketing standpoint there is optimism there.”

Other see the potential, too. Vossen said there are about 10,000 acres of oil-producing olives in California, including about 4,000 acres of super-high-density orchards planted in just the past two years.

Doubts remain, however.

New super-high-density olive orchards also are being planted in Europe, as well as new competitors with low labor costs, such as Argentina and China, said Edward Rich, a boutique olive-oil producer and owner of Calaveras Olive Oil and Land Co. Inc. in Copperopolis.

“I’m sitting here pouring oil for people and that’s how I can charge a little more for it,” he said by telephone from his retail shop Friday. “But I don’t know how the big boys can do it.”

California remains a high-cost agricultural area because of labor and high regulatory hurdles, he said.

It also doesn’t make sense to buy an expensive harvester just to pick olives.

“The only way mechanization works well is where you’ve got a combination of things the machine’s costs can be spread across,” Rich said.

“We’re very optimistic about it, but we’re cautiously optimistic,” Lodi Farming’s Colombini said, noting that many uncertainties remain. Those include how long the high-density orchards will produce, what the olives will command in a few years when the new plantings mature and whether consumers will accept California olive oil.

“What we don’t have is a substantial or significant olive-oil industry in California,” he said. “The first order of business is going to be, as an industry, we need to make a name for ourselves.”

Joe Grant, a cooperative extension fruit and nut crop adviser in Stockton, stressed that San Joaquin County growers should remember they can grow a wide variety of high-value crops in this area.

“Just because this is a new crop, don’t get the idea this is going to be an automatic winner,” he cautioned. “Growers just need to look very carefully at opportunities like this.”

A chance to get that look will be Dec. 7, when Vossen is to lead a workshop in Stockton on olive-oil production.

Grupe, who already has made the leap said he’s taking the advice he often shares with others.

“The one thing is keep your options open, and follow your passion,” he said.

“When opportunity comes along, some people aren’t prepared to take advantage of it,” he said. “During my life, I’ve always tried to be prepared when opportunities came among.”

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