Florida-based Greene River Packing has said its recently announced merger with nearby citrus company Leroy Smith is a necessary and strategic move in responding to the serious challenges facing the industry.

The two entities will combine their packing activities into Greene River's facility in Vero beach for the 2014-2015 season, in what will become one of the largest operations of its kind in the state.

Greene River Packing president Pat Rodgers told www.freshfruitportal.com the merger made perfect sense right now given the lower fruit volumes both companies were handling.

"We're looking at a lot of challenges in the Florida industry with the greening [disease] and the pack-outs and things like that," Rodgers said.

"We just figured that it would be a lot smarter to have one packing house packing the large volumes than two packing houses packing average volumes, so it obviously decreases your overhead and increases efficiency."

The citrus greening disease - often referred to as 'HLB' - eventually kills the trees it comes into contact with and has been devastating crops throughout the state.

Rodgers said the new operation will pack anywhere from 1.8-2 million cartons of fruit annually and has been planned over the last six months.

He added that even though the Greene River facility would become the main packing base for both companies, Leroy Smith's current plant could also serve for additional purposes given its close proximity.

"Leroy Smith is about a mile and a half south of us so we’ll have access to both company’s degreening rooms. We’ll have increased our capacity to about 75 loads of degreening space," he said.

"I’ve got a cooler and he’s got a cooler so we can use theirs if needs be. It really increases opportunities for other things besides just putting all the volume into one packing house."

About 60% of the fruit packed in the facility will be exported to destinations like Japan, Korea, France, the Netherlands, and the U.K, though both companies will market their European and Asian exports separately.

Rodgers said the most challenging part of the whole merger was the sentimental aspect for the Leroy Smith family owners, who opened their packing plant in 1947.

"We know each other's families very well, and there’s a very high level of trust between the two. So the business side of it was a slam dunk, but the emotional side was a little tougher, I think," he said.

"But that tells you how this industry is working right now - how you’ve got to look at some smart operating opportunities."

Rodgers added that if volumes were to pick up again for both companies in the future, the Leroy Smith facility could feasibly open up again in some form.

The personal structure of the new operation has not yet been determined but should be figured out within the next month.

Rodgers also said the coming years would be pivotal for the Florida citrus industry, as some sort of solution must be found against HLB disease, which would otherwise continue to wreak havoc on the state's crop yields.

"The situation is affecting everyone in the industry - it affects the fresh fruit packing houses, it affects the juice plants that are juicing oranges and grapefruit. I'm not saying there’s going to be a lot of changes, but there’s going to be more changes in this industry because there has to be," he said.

"There’s just not enough volume for all the juice plants to run, and as we move forward there might not be enough volumes for all the fresh fruit packing houses to run, too.

"Every year we see something new but over the next two or three years I think we’re really going to see how everything shapes out."

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