Sunday, December 3, 2023

Agriculture in Leelanau Peninsula, Michigan

As reported earlier, the ERJ family went to Isadore in the Leelanau Peninsula to celebrate Thanksgiving.

One of the conversations I had with our host involved the state of the local agriculture. Leelanau Peninsula is one of Michigan's premier fruit-growing regions due to the moderating effect of Lake Michigan and Grand Traverse Bay.

Tom, my host, said that local farmers were getting squeezed by labor shortages. The new fruit-growers are planting wine-grapes and it is more of an exercise in prestige than an attempt to turn a profit. They outbid the cherry, plum and apple orchards for wages.

Secondarily, grape-growers and people building vacation homes are making new land extremely expensive. The things that make the peninsula desirable for growing fruit (slope, good drainage, proximity to the big lakes) makes them very desirable for vacation or retirement homes.

When a farm goes into estate, heirs often opt to cash-out rather than to keep farming due to the eye-popping prices for land.

Another way that farmers are getting squeezed is also related to the availability of labor and that is contracts with processors.

Suppose your name is Jim and you already grow fruit and want to diversify into grapes. You are smart enough to go to the local processors and ask "What varieties are you buying and can you give me a contract?"

Most folks are not as smart as Jim. They read the academic literature (maybe) and plant something they expect will produce heavy yields.

The processors tell Jim, "We will buy as much Johannisberg Reisling or the New York clone of Chardonnay or Cabernet Franc as you can grow."

Then Jim runs the numbers and decides that he cannot afford to grow those grapes due to the amount of spraying, the labor to pick and the losses due to fruit-rots during the fall rains.

The point being, Jim cannot make a profit if he is a distressed seller of a product that is in over-supply nor can he make a profit if he cannot harvest sufficient tonnage per-acre to cover his costs. There are very good reasons why wineries cannot get enough J-berg Reisling, Chardonnay and Cabernet Franc. They are very difficult to grow in the mid-West.

My take on the situation

The small, not-commercially focused family-farm is vertically integrated and does not have Jim's problem. The advantage of eating what you produce is that you are never on the losing-end of the eternal wrestling match between every link of the value-chain for profits.

The downside is that you will only get to eat premium steaks for some of the year and have to "settle" for burger or stew-meat or soup for most of the rest of the year.

If you calculate the time invested as wages you are paying yourself then they will be less than minimum wages and you will feel cheated. If you calculate the time invested as an education then it will be much, much cheaper than you can get at a University and will be far more useful in your life.


  1. Had a branch of the family in the late 1800's go to Berrien County to run an orchard.
    Is the geography on the East side of Lake Michigan similar to the West side? I've been to Door County once and the soil looked like it was 2 parts dirt and 98 parts rocks. Can't believe people stopped there and thought "WOW, this is great land except for the tons of rocks per square acre"

  2. Youngest son has an interest in auto mechanics. He needed to replace the throw out bearing in his car, but couldn't afford a whole clutch. Spent 700 on the clutch for him. When he thanked me I told him it was money well spent on your education. You know how to do a clutch now!

    1. May be the best money you spend on his education
      I take my kids all a trade (I was a contractor in FL) I told them I don't care if you ever want to do this but it gives you something to fall back on.

    2. My dad believed that every son should have a "trade" to fall back upon when things went south.

      He continued to lay carpet even as he worked on his Ph.D. in Education.

      He also insisted that we work a common-labor job so we could appreciate the benefits of a "professional" job. Nothing focuses the mind like picking strawberries for a nickel a quart.

      Decades later, my skills in welding paid multiple benefits in the factory. Few things generate more credibility than to put on a hood, adjust the MIG settings and start throwing down beads when "your guy" has the Johnny-trots and needs a break.

  3. (Mounts soapbox) - ERJ, one thing that will get me aggravated faster than anything is converting otherwise good agricultural land into vineyards for grapes (except, of course, your other example of developing it). It creates a monoculture of agriculture that requires significant inputs and has a single market, which is usually outside of the region itself (especially with grapes). It is also the lowest producing part of the equation - were one to really want to succeed, at it, it makes more sense to plant less acreage and develop an estate winery instead to keep the money in your pocket instead of the big wineries.

    It is also - as you note - incredibly dependent on a labor pool, and especially a labor pool that is willing to work on the lower end of the spectrum (still expensive though, as labor is often your higher cost).

    (Dismounts soapbox)

    Dad and I looked into growing some grapes at The Ranch. There are varieties that should do well there (there are commercial vineyards at our altitude) - but we would only ever do a very small section of them. To your point, one that we ourselves could manage and benefit from.


Readers who are willing to comment make this a better blog. Civil dialog is a valuable thing.