MODESTO, Calif. — Although the 2012 California almond crop wound up 7% smaller than the previous year’s, Blue Diamond Growers still managed to harvest a record $1.2 billion in global almond sales.
Much of the growth was tied to a 14% increase by volume of value-added sales, which now account for more than 60% of the cooperative’s revenue, said Mark Jansen, president and chief executive officer.
But the feat wasn’t easy and required intensive scrambling midway through the marketing year, Jansen told members attending Blue Diamond’s 103rd annual meeting, Nov. 20, in Modesto.
Under the cooperative’s marketing structure, growers harvest the almond crop in the fall, and Blue Diamond markets it through Aug. 30 of the following year.
In 2012, prices shot up by 50 cents per pound, not unlike what happened in 2004, Jansen said. Back then, Blue Diamond member returns suffered and ended up trailing the industry average by 7 cents per pound.
Vicky BoydManuel Azevedo, an almond grower from Ripon, grabs some samples of Blue Diamond’s new fruit-flavored oven-roasted almonds as Maya Erwin, snacks group brand manager, looks on.The 2012 price increase also coincided with the co-op’s launch of a record 15 new products and the completion of the first phase of its food manufacturing plant in Turlock.
“This time the situation was even more difficult because grocery customers require six months (lead time), and our consumer business was five times larger,” he said. “And the news got worse. (Rumors spread) that Blue Diamond was not going to be competitive because they were building the Turlock plant.”
Shortly before last Christmas, Jansen said he assembled his management team to outline the situation.
“They cut costs. They took pricing and found ways to sell more and more profitable products,” he said.
The result was a revenue increase of $189 million compared to the previous year and grower returns of 5 cents per pound above the industry average.
Altogether, Blue Diamond paid out a record $828 million to growers for the 2012 crop.
Since Jansen took the helm of the almond cooperative three years ago, it has put greater emphasis on branded value-added consumer products.
During the 2012 marketing year alone, U.S. branded business increased 30%, to $469 million.
Blue Diamond’s latest introductions include three oven-roasted berry-flavored almond snacks and three oven-roasted, coffee-flavored varieties frequently sold with other nuts and dried fruit adjacent to the produce department.
Clinton Shick, an almond grower from the McFarland area and board chairman, credited nutritional research the almond industry started funding in the 1990s for changing consumers’ perceptions.