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2G Roses closes as Pajaro Valley industry withers

California Pajarosa single survivor of once blooming industry

PAJARO >> A 1995 flood that inundated its San Juan Road greenhouses and caused $1 million in damage didn’t kill 2G Roses.

Nor did a 1991 free trade pact that brought tough competition, tightened margins and drove many other growers out of business.

But Eugene Tsuji and sister Arlene, who ran the company started 41 years ago by their parents, struggled to recover from the recession. A lawsuit filed by an employee alleging sexual harassment by another worker was the last straw.

The siblings called it quits July 22.

“It just came to the point of not being worth it,” Tsuji said.

The closing makes California Pajarosa, across the Pajaro River in Santa Cruz County, the lone survivor of a once flourishing Pajaro Valley rose industry.

In 1991, the year the Andean Trade Preferences Act was approved by Congress opening the door to cheap imports from South America, the Santa Cruz County rose crop was valued at $24 million. By 2005, it had fallen to less than half that, according to the annual crop report. In 2006, in a sign of their fading importance, the county agricultural commission stopped breaking out roses as a separate cut flower category.

In Monterey County, where 2G is located, the situation was the same: Acreage planted in roses dropped, along with value. According to that county’s crop reports, the $8.5 million in roses produced in 2004 represented about a third of the value reported in 1991.

Statewide, the number of cut rose producers dropped from more than 150 in 1991 to 25 in 2013, according to Kasey Cronquist, chief executive officer of the California Cut Flower Commission. Ninety-eight percent of roses sold in the United States are imported.

“It’s a tough battle being a rose grower in this area,” said Paul Furman, sales manager at California Pajarosa outside Watsonville. “Government regulations, labor issues, energy prices, workers’ comp prices, as well as the imports we have to face, it’s definitely a tough business. We just kind of hang on and plug away at what we know best.”

Furman said California Pajarosa survives because it’s been on the cutting edge, a leader in hydroponics and certified sustainability. He said the movement to buy local food is beginning to spill over into the flower market, a trend that should help the company in the future.

For 2G Roses, it’s too late.

To deal with cutthroat South American competition, Tsuji became an early adopter of online direct sales to consumers. It was a strategy that worked for a while. But Tsuji said prices had been stable since the 1980s, while costs rose, and slim margins left little wiggle room when the recession hit in 2008 and wedding sales plummeted.

For the past several years, Tsuji said he and Arlene paid bills first and if there was anything left over, they’d take something out for themselves. Mostly they worked for free, hoping for better times that never came.

He said he couldn’t talk about the lawsuit as the litigation is pending. But, he said, dealing with it was another burden.

After five years of struggle, Tsuji said, it came down to “exactly what are we trying to save here.”

Tsuji said he’s angry, sad and relieved. He has laid off six workers, and the final four will go once the place is cleaned up. At least his parents, who founded the business, didn’t have to witness its demise, he said.

Father Setsui died in 2010, mother Yukiko, earlier.

Tsuji said Setsui was born in the United States, but raised in Japan. He returned to his native country with Yukiko in the 1950s and the couple found employment as farmworkers. For a time, Setsui worked at a rose nursery.

In 1973, he bought a “little sliver of land” and started his own business.

Tsuji hopes to find a tenant to take over the 10-acre property covered with greenhouses. In the meantime, he plans to spend time with his wife, who has been diagnosed with melanoma. Eventually, Tsuji, 53, said he’ll have to find a job.

“It could be worse,” he said.

Fading Roses

In 1991, in an effort to stem the drug trade, Congress passed the Andean Trade Preferences Act, eliminating tariffs and opening the door to cheap South American roses.

• Since then, the number of cut rose growers in California fell from more than 150 to 25.

• The value of Santa Cruz County roses dropped from $24 million in 1991 to $10.9 million in 2005, the last year figures for roses were broken out in annual crop report.

• The value of Monterey County roses fell from $26.8 million in 1991 to $2.9 million in 2013.

• 98 percent of roses bought in the United States are imported.

Sources: California Cut Flower Commission, Santa Cruz County 1991 and 2005 crop reports, Monterey County 1991 and 2013 crop reports.



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    Interesting USA/Colombia trade figures………
    “Colombia is currently our 21st largest goods trading partner with $40 billion in total (two way) goods trade during 2013. Goods exports totaled $19 billion; Goods imports totaled $22 billion. The U.S. goods trade deficit with Colombia was $3 billion in 2013.”

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    Maybe the greenhouses can be used for one or two specialized crops similar to what this Canadian grower is trying?

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    I have sympathy for the owners as an ex rose grower from Illinois before Colombia production came in any big numbers. So many good advantages to growing crops like roses in South America with the biggest being no heat or lighting required to produce excellent roses. Number two is the lower labor costs. Companies who export to Colombia of course are happy with the free trade agreement. Hopefully the owners will find another use for the greenhouses like nursery stock, bedding plants, pot plants etc. If not then maybe there is value in the land? I wish them the best in this ever changing world.

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