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Angling for food processors in the Golden State

Large food show in Anaheim is next as Oregon officials recruit California companies

State and local economic development officials in Oregon continue to look south in hopes of attracting food processing companies that may consider leaving California or expanding operations elsewhere. For the second straight year, representatives of local communities will join specialists from the Oregon Department of Agriculture and Business Oregon as they participate in a large natural foods show in California this weekend.

“It’s a large lake with a lot of fish and we hope to land a couple to bring back to Oregon,” says ODA Business Development Manager Jerry Gardner, who will be among those attending the Natural Products Expo West in Anaheim. “Many parts of Oregon depend on agriculture in various ways. Adding more food processing capacity in these rural communities would be a great thing for our overall economic development.”

Some Oregon counties have been slow to recover from the recession and still have high unemployment rates. That’s why local, regional, and state officials are looking at all opportunities to attract industries that create jobs. Food processing often makes sense where agricultural production takes place– and for many Oregon communities, farming and ranching is a large slice of the local economy.

In 2011, the leadership of the Oregon Economic Development Association (OEDA)– which is made up of city, county, and regional economic development organizations– surveyed their members on what kind of companies and industries they are most interested in recruiting. With more than 70 responses gathered, 25 percent indicated that food processing was a high priority with their community and they planned business recruitment activities. Using a business model that had worked to recruit high-tech companies to Oregon, OEDA identified and planned activities that would inform out-of-state companies about what Oregon has to offer should consider relocation. Trade shows have been a focused component of the recruitment effort. Last year, Oregon representatives participated in the Winter Fancy Food Show in San Francisco as well as the Natural Products Expo West Show. Oregon scheduled encore performances for 2013.

“Normally, when we talk about food processing interest around the state, we may hear from three or four entities,” says Gardner. “But for this upcoming show in Anaheim, we have 13 OEDA members, each sending their own representatives at their own expense.”

Those members include: Southern Oregon Regional Economic Development, Inc. (SOREDI); Snake River Economic Alliance; McMinnville Economic Development; Lane County Economic Development; Douglas County Partnership; Port of Portland; SEDCOR (Strategic Economic Development Corporation, which represents the Mid-Willamette Valley); City of Forest Grove; City of Corvallis; City of Pendleton; City of Medford; Klamath County Economic Development; and, Grants Pass, Inc. Participating communities have contributed $1,000 and are paying their own expenses to attend the show. Other team members, including ODA, Business Oregon, Pacific Power, and PGE, are also contributing funds.

A State of Oregon booth will be set up at the Anaheim show with representatives talking to the hundreds of companies in attendance– many of them from California. The Oregon representatives will be able to make a personal pitch for their own communities to companies that might be considering relocation or expansion. There will also be a special Oregon reception, which is expected to attract up to 75 company representatives. A special brochure will be handed out that explains Oregon’s food processing capacity, advantages, and a list of available industrial properties. The aim is to get those companies to visit Oregon and see the positives up close.

Gardner cites a New York Times quote to explain why the focus is on California: “If there’s any place in the country where rising tax rates should choke off an economic recovery, it’s California.”

At last year’s Natural Products Expo West, Oregon officials received 41 leads from out-of-state companies planning an expansion or relocation in the next 24 months and hope to hear much the same this year.

“A lot of folks want to leave California, so that’s why we’ve been hitting the shows in San Francisco and the Los Angeles area,” says Gardner.

Gardner cannot divulge names or a lot of details, but he says a long time food processor from Northern California, who attended the Fancy Food Show in January, has been buying thousands of metric tons of fruit from Oregon but now needs to expand. The company can no longer afford the earthquake insurance required for the construction of new buildings and is close to building a new facility in Oregon along with its 60 jobs.

There is also great interest in co-packing opportunities in which an existing Oregon company would process and package foods for an out-of-state company. Those types of leads for potential co-packing will also be on the agenda at the show in Anaheim.

Past efforts to recruit California food companies have had significant success. In 2006, Amy’s Kitchen expanded its organic frozen food processing operation to include a major facility in the Medford area. At the time, Governor Kulongoski listed such factors as lower electric power costs, lower workers’ compensation costs, and the diversity of local crops as reasons for the company to locate in Oregon and employ around 250 people.

Whether another Amy’s Kitchen-type food company decides to jump from California to Oregon remains to be seen. Even if several smaller processors make the move, the recruiting efforts are worth it. However, all the work will not come at the expense of existing Oregon food processors, according to ODA Director Katy Coba.

“Priority number one is our existing companies and keeping them in business. Priority number two is helping our existing companies expand if they wish. The third priority is recruiting new businesses to Oregon.”

If it makes good business sense for California companies to make Oregon home, the welcome mat is out.

For more information, contact Jerry Gardner at (503) 872-6608.

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