Business & economy

Malheur County sugar beet and onion producers shift to Idaho, census shows

The high cost of doing business in Oregon has prompted some onion and sugar beet producers to move operations to Idaho. 

The production of onions and sugar beets, Malheur County’s two core crops, declined over the last five years, according to a U.S. Department of Agriculture census. 

The recently released census provides a snapshot of the nine agriculture benchmarks measured in the county. The figures, compare 2022 to 2017 and cover everything from the average size of a farm to the amount of federal support payments, offering insights into the state of the industry. 

The data is used by the federal government to establish subsidies issued each year to farmers.

The census showed a decline of 3,450 acres of dry onions harvested from 2017 to 2022, dropping to a total of 10,030. 

That was a challenging period for producers, according to Dave Losh, a statistician with the National Agriculture Statistics Service. He said that the increasing cost of doing business in Oregon, from a higher minimum wage to higher energy costs, has forced many to shift their operations to Idaho. 

Meanwhile, according to the census in Idaho, sugar beet and onion acreage jumped by nearly 4,000 acres. 

In Payette County, Losh said, sugar beets acreage jumped by over 1,000 acres while onions increased by over 600. 

Other factors may have influenced the increase in Idaho acreage, said Losh. He said after the epic 2017 snowstorms destroyed warehouses and packing sheds, some growers elected to rebuild Idaho for its economic benefits.

One such producer was Shay Myers, chief executive, and general manager of Owyhee Produce, who rebuilt his Nyssa packing sheds in Canyon County, a roughly one-mile drive over the border in Idaho. The third-generation farmer said when he rebuilt his packing sheds in Idaho the business had to move fast. The process of getting the project approved and permitted moved much quicker than it would have in Oregon. 

In Idaho, he said, while there were “i’s to be dotted and t’s to be crossed,” he said Canyon County Economic Development took a much more “common sense approach.” 

“They pushed the project through a lot more quickly than I think ever would have happened in Oregon,” he said. 

Myers pointed out that much has changed in Canyon County after the population boom the area saw during the pandemic. Now, he said, the county is not as “keen” to work with new businesses coming in. Still,  he said, Idaho as a state still provides “significant” advantages for businesses to operate.  

One example that Myers pointed out is the mandatory retirement match required of Oregon business owners. He said his company is big enough that if an employee opts in, an employer must pay an additional 3% or so into a retirement account for the worker. Myers said it’s a good program. Workers need to make a living wage that will allow them to survive and create a future for their families. 

Nonetheless, Myers said farms are competing internationally. So, when a state makes it harder to operate, it forces farmers to make “hard decisions” because they don’t get to decide what they charge. 

Myers said he is frustrated with the lack of compromise in Oregon policymaking. When he describes how legislation impacts his business, he is dubbed a “greedy” employer who does not care about the people working for him.

Grant Kitamura, the general manager and part owner of the onion packing firm Baker & Murakami Produce Co., said while he did not move his business to Idaho, he moved to a home in Fruitland about four years ago. 

Kitamura, a member of Oregon’s state Board of Agriculture at the time, had to step down because directors must reside in the state. He said he knew that prior to moving to Idaho. 

Kitamura said he relocated for lower property taxes. 

He remains the board president of the Malheur County Development Corp., the public company overseeing the construction of the Nyssa rail depot. The $40 million project will primarily benefit onion farmers. 

According to a consultant’s report done for the public company, 55% of the onions estimated to be funneled through the facility will come from Idaho. Those producers will see the same cost savings as their Oregon counterparts even though Idaho isn’t covering any of the costs of the Oregon depot.

Shawna Peterson, executive director of MCDC, said that is just the nature of where the produce is grown in the Treasure Valley. Peterson said the Oregon Legislature could look at preferential pricing or incentives for Oregon producers to use the Nyssa depot.

Kitamura said the savings for onion producers could allow the industry to hire more employees, which would boost the local economy.

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