Firm turning from land, pineapple
In the wake of layoffs, Maui Pine will focus instead on forestry and energy crops
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Maui Land & Pineapple Co. is shifting its agricultural focus from conventional pineapple farming to forestry and energy crops in the wake of its largest-ever round of layoffs, announced Thursday.
MLP's agricultural segment accounted for three-quarters of the 274 jobs lost.
The company is moving away from pineapple as it tries to restore profitability, but U.S. Sen. Daniel Inouye said "we can't simply throw in the towel" on the crop. "Pineapples are part of Maui's legacy."
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Maui Land & Pineapple Co. will likely soon have less land and pineapple in the wake of its largest-ever round of layoffs, announced Thursday.
With many feeling Hawaii’s economic crunch, Maui Land & Pineapple lays off more than a fourth of its 1,100 employees.
The Kahului-based company, which farms crops on Maui as well as operates Kapalua Resort in Lahaina and Maui real estate investments, will shift its agricultural focus from conventional pineapple farming to forestry and energy crops. MLP's agricultural segment accounted for three-quarters of the 274 jobs lost.
In a written statement about the layoffs, U.S. Sen. Daniel Inouye vowed to work to save Maui's pineapple cultivation.
"While it is a sign of our down-turning economy, we cannot simply throw in the towel," Inouye said. "I will be working with the company, the ILWU and the agricultural leadership to keep at least some pineapple cultivation on Maui, possibly under a different business model."
David Cole, MLP's president and chief executive officer, said the company started trimming "low-hanging" costs such as vendors and consultants last week to bring MLP back to profitability. The company has posted a financial loss for the past four quarters.
Of the affected workers, 75 are International Longshore & Warehouse Union employees. Before the layoffs, 441 of the company's 1,045-person work force was union. Nonunion workers were notified Thursday, yesterday and today, while union notifications will be given next week.
"We have known for years that we can't compete in the commodity food business. There are a few niches that work well for us," Cole said in an interview. "We are looking to establish partnerships with independent growers."
Those niches include farming organic fresh pineapple, which the company grows on 20 acres, as well as re-establishing a koa forest on up to 600 acres near the resort for use in high-end furniture and crafts.
Cole said he would also like to expedite research in alternative energy crops that started under Hawaii BioEnergy LLC, a partnership formed in 2006 to study the viability of a large-scale biofuels industry in Hawaii.
The company is expanding small crops of tomatoes, lettuces and specialty fruits grown in its Kapalua Farms segment for local markets, as well as farming eggs and free-range chickens.
In the past several years, MLP has moved toward year-round fruit production and implemented crop maintenance and farming practices to improve plant yields and fruit quality, the company said in its most recent quarterly filing.
Pineapple grows on a four-year cycle, so at any given time a quarter of the land devoted to pineapple harvest is fallow, said third-generation farmer Wesley Nohara, recently appointed general manager of MLP's agricultural operations. The koa trees will take 30 years to grow.
The company owned about 24,600 acres on Maui as of its latest annual regulatory filing. About 2,600 acres of leased land is used in agriculture operations under 10 leases expiring through 2018. MLP is farming about 600 acres of leased land in West Maui and 1,500 acres in East Maui, Nohara said. Of owned productive agricultural land, the company has 1,500 acres in East Maui and more than 2,000 acres in West Maui.
Most of the company's agricultural lands are still tied up in conventional pineapple farms, and MLP has no plans to shut down a $17.5 million fresh-fruit packing facility it opened in July 2006. Nohara said he expects acreage of smaller nonpineapple crops to double in the next year or two.
"While we are still trying our best to keep our pineapple business going in a much smaller scale, we are trying to focus on expanding our diversified ag section, which includes our organic crops," Nohara said. "We need to look for alternate uses of the land -- what that would look like a year from now, I can't tell you that."