Cost Estimation of Establishing a Cider Apple Orchard in Western Washington

Cider apple production is increasing in Washington State where an estimated 204 acres were produced in 2010 and 256 acres in 2011. Common cider apple varieties grown include Kingston Black, Yarlington Mill, Brown Snout, Dabinett, Porter's Perfection, among others. Fewer pesticide inputs are used for cider apples than for dessert apples, as minor surface blemishes are tolerated if yield and internal fruit quality are not affected. In western Washington cider apple production is not limited by environment-induced diseases (e.g., scab) which otherwise limit apple production and yields. The objective of this study was to provide information on (1) the costs of equipment, materials, supplies, and labor required to establish and produce a cider apple orchard in western Washington; and (2) the ranges of price and yield levels at which cider apple production would be a profitable enterprise. The study outlined baseline production assumptions for a 10-acre cider apple orchard based on input from producers, including a productive orchard life of 25 years, with four years of establishment and 21 years of full production; and crop yield of 5 bins/acre, 12 bins/acre and 46 bins/acre during Years 3, 4 and thereafter, respectively. Furthermore, the baseline price received for a 900-lb bin of cider apples was $315 ($0.35 per lb). Study findings indicated that a producer will start to receive positive net returns after four years. For a fully established cider apple orchard, a producer would expect about $2,400 per acre of net returns based on a yield of 46 bins/acre at $315/bin, and the break-even return was estimated at $263/bin ($0.29 per lb). The cost of investing in the cider apple orchard was estimated to be recovered after 14 years. Changing the price level while holding all else constant, the investment cost would not be recovered within the productive life of the orchard if the price received for cider apples was $290/bin ($0.32 per lb). At higher prices of $350/bin ($0.39 per lb) and $400/bin ($0.44 per lb), the estimated payback periods were 10.06 years and 7.71 years, respectively. Given the baseline yield, price and production costs, study results show that it would be economically feasible to produce cider apples in western Washington.