The United States apple industry is dominated by growers in Washington State, who in 2013 grew 70% of the $3.15 billion fresh apple crop nationally.
The market for fresh apples grown in Washington State is remarkably stable and orderly, which makes for a high degree of predictability in the business aspect of this industry.
Supply - With the advent of controlled atmosphere (CA) storage, the formerly seasonal market for fresh apples has been transformed into an uninterrupted and predictable supply. Washington State packers have a well-developed infrastructure for CA storage of apples, which results in a relatively steady year-round flow of good quality fresh fruit to the market. Furthermore, because Washington dominates the U.S. apple market, packers and marketers in this state are able to effectively manage the steady supply of apples to the U.S. and export markets.
Demand - Consumer demand and retail prices for fresh apples are also very stable. The apple is the No. 2 commodity (second only to the banana) in the produce section of grocery stores in terms of quantity sold and profit margin for the retailer. The U.S. annual consumption of fresh apples has remained steady at an average of about 17 pounds per capita over the last two decades.
Profitability - Historically, the Washington State apple crop is profitable on average. In low production years, the short supply of apples results in higher prices and robust profits. In high production years, the plentiful supply of apples results in lower prices and lower profit margins, but is offset to a degree by the higher volume of product.