AN ECONOMIC ASSESSMENT OF WATERMELONS Executive Summary U.S. watermelon production reached 3.67 billion pounds in 1993, up 1 percent from the prior year and up about 41 percent from watermelon output in 1981. Florida, California, Texas, and Georgia, respectively, are the leading watermelon-producing states, accounting for two-thirds of U.S. output. Although Florida is the leading producer, the largest gains in output between 1981 and 1993 occurred in California and Georgia. U.S. watermelon production is highly seasonal, peaking from May through August and declining through December. The season begins with production from Florida, followed by output from Arizona, Texas, California, and the southeastern and south-central states. Florida is the only domestic source of watermelons from December through April, and then only in small quantities. Although Florida growers harvest watermelons during virtually every month, the peak harvest occurs during May, June, and early July. U.S. watermelon consumption has increased modestly in recent years, rising from about 12 pounds per person during the early 1980's to about 14 pounds during the early 1990's. The rise in consumption may be due partly to increased availability of imported watermelons in the U.S. off-season, and the increased use of watermelon in restaurants and deli salad bars. The development of "seedless" watermelons has increased their appeal to some consumers who disliked the seeds in seeded watermelons. Considerable variability exists in watermelon prices within the year, due mostly to seasonal changes in the volume of production. The prices that growers receive early in the season, when Florida is the principal source of domestic watermelons, may reach 10-15 cents a pound. Prices usually reach their lowest point, at around 4-5 cents a pound, during July and August, when watermelons are available from a wide number of sources. According to the Census of Agriculture, there were 10,706 farms with 220,244 harvested acres of watermelons in 1992. Forty-six percent of U.S. watermelon acreage was irrigated in 1992. All of California's and Arizona's acreage was irrigated, as was 73 percent of Florida's acreage. There is a significant amount of non-irrigated watermelon acreage in other southern and midwestern states, which is susceptible to yield losses during periods of drought. Watermelons prefer a long, warm growing season and are, therefore, produced primarily in the southern half of the United States. The optimum average temperature for growing watermelon is 70o F to 85o F, but they can tolerate average temperatures as high as 95o F. Watermelons are relatively tolerant of high humidity and can be grown in both humid and arid conditions. Watermelons prefer well-drained, sandy loam soils which are slightly acidic or neutral, with a pH in the 6.0 to 7.0 range. Watermelons will also do well on other types of soils as long as adequate water is available and good drainage is provided. Currently, approximately 50 varieties of watermelons are produced commercially in the United States. The new seedless hybrid varieties are particularly growing in popularity. Watermelon can be either direct-seeded or transplanted. When direct-seeding is used, growers overplant and then thin to the desired number of plants per acre after the young plants have become established. The high cost of seed--compounded by overplanting--has led to the increased use of transplants. Transplanting is the standard method for planting the seedless varieties because of high seed costs and because they tend to be harder to establish by direct seeding than the seeded varieties. The use of transplants not only reduces seed costs, it also offers the potential for an earlier harvest. Watermelons are cut from the vine, rather than being pulled or broken off. Harvesting crews typically consist of 2 or 3 cutters, 4 to 6 loaders, 2 stackers, and one truck driver. The cutters select ripe melons and cut and place them along in-field roadways. Loaders pick up and pass the harvested melons to stackers located on a wagon or field truck. The melons are then hauled out of the field to a waiting over-the-road tractor- trailer for bulk loading or to a nearby packingshed for bin- or carton-packing. Because watermelons in a given field ripen at different times, growers need to harvest several times to achieve maximum yields. The first harvest yields the largest and highest-quality melons. Size and quality generally decline with successive harvests and costs rise because the harvesting crew must glean a larger area to collect a load of melons. The major production perils affecting watermelons include excessive rain, excessive heat, and, in non-irrigated areas, drought. Excess rain during any stage of growth can reduce watermelon yields. Excessive heat and direct sunlight increase the likelihood of yield losses due to sunscald or sunburn, which causes yellowing of the rind. Drought may reduce watermelon yields by diminishing plant growth, limiting the development and size of the melons, and can exacerbate losses due to sunscald. Bacterial fruit blotch, a relatively new watermelon disease in the United States, is also a major concern. It is thought to be a seedborne disease, and its symptoms include brownish scabs and eventual souring of the flesh. Yield losses can be substantial in infected fields. The disease is thought to be more serious in humid areas than in drier production areas. Since the disease appears to be seedborne, some seed companies have withdrawn their seed from the market because of concerns over liability for crop losses. The watermelon industry is working with the seed companies to establish an effective protocol for certifying disease-free seed. Our assessment is that watermelon is a good candidate for multiple-peril crop insurance. There is likely to be a substantial demand for insurance among growers in the central and eastern U.S. growing areas, as these growers face a considerable array of production perils, particularly when compared with Arizona and California growers. Overall, the National Watermelon Association's position is that they would like for watermelons to become a "full partner" in crop insurance in the same manner as the major field crops.