Mark Hanrahan cut open a Cosmic Crisp apple on his orchard north of Buena, Washington, on a hazy morning in mid-September. With a spray of iodine, he could tell by the ensuing coloration the conversion of starch to sugar in the apple. It's one of a few ways to judge an apple's maturity and storability. “It’s still a few weeks out, at least,” he said.
He drove his orchard car — a dusty, well-loved sedan — to a neighboring orchard of Golden Delicious, where the last of the crop was about to be harvested. He also grows cherries and pears, which are his major focuses on the family farm his father started in the 1960s. His mother descended from early hop growing families in Moxee.
Save for some hot August days, the weather was generally good for fruit across the Yakima Valley. The Washington State Tree Fruit Association forecasted a harvest of 142 million 40-pound boxes in August. The last time the harvest was that high was in 2014.
The August forecast made Hanrahan nervous in terms of oversupply. It likely will be lower based on early-season numbers released this week.
Sitting at a dining room table, he said that overproduction is a topic of discussion among growers this year, with many worried that it will drive prices below profitability. It would come at a rough time, with many growers seeing losses in recent years.
It could be the third year in a row with poor pricing due to oversupply of apples in the market, though the latest survey suggests growers are picking more selectively.
Times have been better. Hanrahan saw his cherry prices slowly dip below profitability a few weeks into the harvest because of overproduction. He also had to rip out prime cherry orchards due to Western X disease.
Hanrahan believes that 108 million boxes of Washington apples is the line of profitability. Other people have other numbers, higher and lower.
Finding a “golden number” is tricky, because of the many variables that go into the profitability of the harvest, said Jon DeVaney, president of the Washington State Tree Fruit Association. That includes the supply and demand of different varieties, the global trade environment, and the valuation of the U.S. dollar in relation to other currencies.
But all seem to agree that 140 million boxes of apples are far too many.
"I am very worried about it," said Ricky Adams, a commercial relationship manager with Columbia Bank in Yakima (formerly Umpqua Bank).
Calls to scale back
The domestic market will take 100 million to 105 million boxes of apples, Adams said. He believes a happy number is not too much higher than that, with some to sell to more profitable foreign markets like Canada and Mexico, maybe 125 million at most.
“The market needs to correct. We need to take acreage out of the ground pretty significantly," Adams said. “If the industry does not make changes, it’s going to be painful over the next few years.”
The industry needs to prune significantly for quality and for less fruit overall, he said.
Welcome Sauer, a former tree fruit industry executive from Wenatchee, recently gave a talk at the U.S. Apple Association conference in Chicago where calls to scale back "by choice or by force" took center stage.
Demand for older varieties like Red and Golden Delicious and "once-newer" varieties like Fuji and Gala, which peaked around 2016 are falling, much faster than the supply has been falling.
The failure to correct has consequences.
"This contributes to oversupply for the collective apple market, dampening prices for all varieties," Sauer said in an email. Only about 42% of Washington's apple production has the right grade and size to be profitable.
Apple harvest
A bin of Golden Delicious apples sits in an orchard owned by Hanrahan Orchards during apple harvest Thursday, Sept. 18, 2025, in Yakima, Wash.
Production costs mounting, especially labor
DeVaney said it is challenging to get the message out to the public that this year’s crop is good in terms of quality, but that doesn’t mean that growers are going to make money on it.
“Right now, there is a huge amount of economic pressure on growers. They're seeing significant losses," he said.
There are a few reasons for the situation, some immediate like the concerns about oversupply. Some have been compounding over years, namely rising production costs.
Labor is the largest variable production cost for tree fruit, and was about 60% on average based on a study from a few years ago, but agricultural wages have been rising faster than other segments of the economy, DeVaney said. It's pushing growers into the red.
According to a Northwest Horticulture Council study, growers on average spent 99% of their net returns of their 2023 harvest on labor. Kate Tynan, senior vice president of the Northwest Horticultural Council, told the Yakima Herald-Republic that Washington’s apple growers are on track to see 97% of what they make from this year’s harvest go toward labor costs.
“After packing charges and selling costs and payment of labor, there is not a lot of profit if any left on almost every acre of ground right now," Adams said. Only premium and highest grade fruit are getting any kind of returns.
Recent changes to the H-2A program will lower the wages for foreign guest workers in the Northwest and allow housing costs to be subtracted from wages. Those changes take effect for contracts after Oct. 2.
Hanrahan said he had been priced out of the H-2A program, but he now sees it as a potential solution in the future to help stabilize his orchard's labor supply.
"I'm studying it," he said. He could not get as many crew members locally as he wanted during the cherry season.
The program still has its barriers. He would only need foreign guestworkers for about a month out of the year and would have to find ways to partner with other growers, like hops growers, to share the labor. And there is the usual red tape.
"You almost have to be an attorney to understand the rules and regulations," he said.
Little room for negotiation with retailers
Growers are price takers, not price setters. And there are only four or five major retailers buying fruit in the U.S.
“If you only have a few big retailer customers taking your product, it doesn’t really leave a lot of options to negotiate,” DeVaney said.
There is even less negotiation in times of abundant supply like this year for cherries, apples and pears. If you decline a buyer’s price, another grower will gladly accept it.
“It’s frustrating for growers to say ‘I have beautiful fruit, some of the best I’ve ever had, and I’m going to lose money,’” DeVaney said.
At the same time, fruit prices remain high at the grocery store.
“They are capturing more margin on that fruit, but less of it is going to the grower," Adams said.
Competition with imported food from countries with more relaxed regulatory environments has made some growers sympathetic to President Donald Trump’s tariff strategy, hoping that it will eventually lead to a more reciprocal trade environment, DeVaney said.
Recent bad years compounding
Very few growers can self-finance. Nearly all have long-term loans for real estate or orchard development, or shorter-term operating loans, Adams said.
Cash flow is limited during harvest time, as advance payments from warehouses are used up and last year’s apples haven’t been paid out yet. During the worst of times, growers have typically put up land for sale. But no one seems to be buying right now.
At the start of the downturn, private equity groups and outside investors were buying up family orchards, but commercial orchard land doesn’t seem to be selling as much in the last year, Adams said.
“They showed a lot of interest several years prior when returns were more favorable, but now that the return per acre is negative on a lot of things, they’ve backed off pretty significantly," Adams said.
Apple harvest
A worker picks Golden Delicious apples during harvest in an orchard owned by Hanrahan Orchards Thursday, Sept. 18, 2025, in Yakima, Wash.
And just because their land may be worth more is cold comfort for a family that needs cash to buy food and gas, DeVaney said.
If no one is buying the land, then there are few ways to quickly pull out of the business.
In a downcycle like this one, banks will also be hesitant to extend credit following multiple years of losses, DeVaney said.
The problem is hard to quantify.
“Everybody knows that credit card debt is a problem, but no one wants to talk about theirs,” he said.
There are federally subsidized insurance programs to support growers, including whole-farm revenue protection. But that is calculated on a five-year average, and revenues have dropped significantly in that time frame.
Conditions shift faster than trees grow
DeVaney emphasized that the agricultural industry goes though cycles, and always comes out the other side back to profitability. But that doesn't mean it isn't painful.
He said that multi-year losses are not a sign that growers don’t know what they’re doing. It’s that there are many guesses that have to be made over a long period of time on which crops and varieties to invest in.
By the time a tree reaches maturity, many changes will occur in the local and global economy.
“Suddenly, you find that your costs have increased much more rapidly and your access to certain customers has changed significantly,” he said.
International events affect the ability to export as domestic demand for apples stagnates/wanes. Russia’s invasion of Crimea in 2014 led Poland to divert its typically Russian-bound apples to the Arabian Gulf instead, where they competed with U.S. apples.
China was a major export market until the Trump administration’s first trade war with the nation in 2017. The industry has been attempting to send more fruit to other Asian nations like India and Vietnam to make up for the losses.
International trade disputes could not be predicted when growers planted their orchards decades ago. Growers would rather wait-and-see before ripping out an orchard that they invested tens of thousands of dollars in per acre.
“Many of them are enduring a lot of economic pain to see if conditions turn more favorable before they walk away from a huge capital investment,” DeVaney said.
Which is why it is striking that some growers in the Yakima Valley are at that point and have fallowed land due to market conditions.
"You take a drive, you see them. It’s not just the Yakima Valley. You drive up to the Canadian border, you see orchards being taken out," Adams said.
That’s due to oversupply and low demand of certain varieties, and poor coloring that doesn’t meet retail standards. Most of what is taken out are low-density older varieties like Red Delicious as well as poorly coloring Fujis, Galas, and Honeycrisps, Adams said.
But he doesn't believe what has come out of production is enough.
Drought
On Oct. 6, Ecology took the dramatic step to limit nearly all surface water use in the Yakima Basin, following three years of drought conditions resulting from poor snowpack and low reservoir storage.
It was the first time in over 30 years that senior water rights have seen curtailment due to a lack of water supply.
Pro-ratable districts such as the Kittitas Reclamation District and the Roza Irrigation District had already shut off water, on Aug. 13 and Sept. 24, respectively, after seeing only 40% of their allotment for the water year.
Hanrahan's orchards are mostly in the Roza Irrigation District, with some in the neighboring Union Gap Irrigation District. In the Roza, he pooled his water with a hops grower, which has different timing for water. The partnership helped to stabilize water delivery. Two supplemental wells keep his fruit watered during times of shutoff.
"The Roza is the most efficient irrigation system in the world," Hanrahan said.
The multi-year drought only stresses the need for more investments in water storage and infrastructure, DeVaney said.
Though the basin is subject to multi-year droughts like this one, the Columbia basin as a whole has a more stable water supply than other parts of the country, like California, he said.
DeVaney said that as the climate changes, there may be a future here in the basin for crops now grown in California, like tomatoes and tree nuts.
Looking ahead
Growers look at a large forecast in years like this one and make intentional decisions on what to pick, so DeVaney believes that the harvest will be lower than forecasted.
A few hundred-degree days in August led to poor coloring on some varieties, which may not have gotten picked. Many apple varieties need cool nights to develop red color.
Oct. 1, 2025 Apple Storage Report
Washington State Tree Fruit Association members have been surveyed on their harvest of early varieties like Honeycrisp, Gala, and Golden Delicious. It’s the first indication on how the harvest is trending.
Growers have harvested 5.6 million fewer boxes of these early varieties than the forecast predicted this summer, which is likely due to the August heat and selective picking, DeVaney said. "Growers are making smart choices."
A more comprehensive report of the ongoing harvest comes out on Nov. 1, but the final details are not reported until Dec. 1.
Hanrahan was able to get his fruit harvested in time. The last of his Cosmic Crisps will be harvested on Oct. 13, he said. He still has concerns about the price for them.
What can be done to help?
DeVaney said that because many of the issues facing growers are policy related, there are avenues for change. He has been encouraged by the talks going on in D.C. Industry leaders are talking with the Trump administration and Congress on infrastructure investments, stabilizing export markets, and reducing labor costs.
The recent changes to the H-2A program are evidence of that, DeVaney said. He believes there is a bipartisan desire for immigration reform, including pathways for citizenship for undocumented workers.
“I’ve heard growers sort of say, if anyone has the credibility to talk about putting undocumented workers into a legal status, it would be this administration, in the sort of way that only Nixon could have gone to China.”
It's important to take the long view in agriculture. And the future for Washington state's apple crop appears to be bright.
“We still have a lot of climate advantages. We’re a highly regulated and not a low-cost state, but we can compete based on quality and innovation," DeVaney said.
Do you have questions or a story about the harvest or drought this year? Email qinghram@yakimaherald.com.
© 2025 Yakima Herald-Republic (Yakima, Wash.). Visit www.yakima-herald.com. Distributed by Tribune Content Agency, LLC.
