Delivering the benefits of almonds to the world this holiday season.

48 Pages·2015·6.74 MB·English

NOVEMBER | DECEMBER 2015
News, Views & Industry Insights
Delivering the benefits of almonds
to the world this holiday season.
105th Annual Young Leaders Huller/Shellers
Meeting Great Meet State Explore
Success Advocates FSMA

CONTENTS
NOVEMBER | DECEMBER 2015
P. 29
Features
14 Annual Meeting 24 Young Leaders 16 FIELD SUPERVISORS
18 GROWER LIAISON
Blue Diamond growers and business The Young Leader class of 2015
partners converged on the Modesto heard from Blue Diamond’s new state 20 NEWS IN A NUTSHELL
Centre Plaza to celebrate a advocates at their graduation dinner.
36 THE BEE BOX
successful year.
42 TIME TO CONSIDER
32 Huller/Shellers 40 Ketcher Retires 46 CLASSIFIED ADS
The Food Safety Modernization Act Long-time field supervisor and field
took center stage at the cooperative’s receiving manager Bob Ketcher retires
annual Huller/Sheller breakfast. after 38 years with the cooperative.
NOVEMBER | DECEMBER 2015 Almond Facts 3
Board of Directors
Dan Cummings
Chairman of the Board | Chico
Dale Van Groningen
Vice Chairman | Ripon
Clinton Shick | McFarland
Charles Crivelli III | Turlock
Kevin Fondse | Ripon
Elaine Rominger | Arbuckle
George Goshgarian | Fresno
Stephen Van Duyn | Modesto
Robert Weimer | Atwater
Don Yee | El Dorado Hills
Officers
Mark Jansen, President and CEO
Dean LaVallee, Chief Financial Officer
Almond Facts Staff
Alicia Rockwell, Corporate Communications Director
Cassandra Montgomery, Managing Editor
Mel Machado, Contributing Photographer
Gray Allen, Advertising Sales
916.783.4334 & 916.765.3234
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Blue Diamond, the world’s largest processor and marketer of almonds, exports to
90 countries. The cooperative marketing corporation also markets hazelnuts.
Almond Facts, established in 1922, is published bimonthly by Blue Diamond Growers,
1802 C Street, Sacramento, California 95811, phone: [phone]. Address all
correspondence to the Editor, Almond Facts, P.O. Box 1768, Sacramento, California
95812 Advertising subscription rates provided upon request.
Blue Diamond is a registered trademark and marketing brand of Blue Diamond Growers.
Other registered trademarks are The Almond People, Smokehouse, Golden State, Celebration,
From the Valleys of California, Confetti and Almond Facts.
Advertising carried in this magazine does not necessarily reflect the beliefs, opinions,
or attitudes of Blue Diamond and does not imply product or service endorsement. Blue
Diamond reserves the right to refuse advertising. All rights reserved. Reproduction in
whole or in part without written permission is prohibited. © Blue Diamond Growers 2015.

R
E
N
R
O
C President’s Corner

S
’
T
N Mark Jansen
E
D President and CEO
I
S
E
R Sustaining
P
Success
Through
Innovation
Adapted from 2015 Annual
Meeting Remarks
At Blue Diamond, there
are 1,400 employees and
over 3,000 growers always
willing to stretch higher.
Every day, getting better
is so important to our
success. There are also
times when we need to
step back in order to take
a leap forward. Innovation
is not doing something a little better. It is wrote that the “State’s Growing, and Thirsty, Almond
discovering a better way. Industry is Sowing Seeds of Discontent.”
For over 105 years great innovations have made Blue It took a while to turn the bow of the ship, but with
Diamond the almond industry leader. These innovations concerted effort to change the path of the reporting,
include: finding more productive ways to grow almonds eventually we started to get the messaging more balanced.
that reduced water usage per pound by 30 percent; The LA Times said “Almonds are Not the Demons of
doubling production at Turlock with enhanced food safety Drought. Frustrated Growers Tell Another Story.”
and yield; allowing millions of consumers with allergies
Fox Business reported that “California is Sucking the
and food intolerances to enjoy a glass of Almond Breeze or a
Almond Industry Dry.” Take Part, said it best, “Almonds are
handful of Nut*Thins crackers.
not a Drought Villain, They are a Climate Change Hero.”
In year four of the California drought, many of us feel
We cannot outsource almond production. Of the world’s
that almonds have been under attack. The newspapers,
supply of almonds, California grows 83 percent. They thrive
talk show hosts and bloggers have been looking for a
in our unique hot and dry Mediterranean climate. California
villain and for a while almonds were the scapegoat. The
is the best place to grow almonds. By contrast, Spain is
Atlantic Magazine thought they had discovered “The
the second largest almond producer, with even more acres
Dark Side of Almond Use.” The normally rational BBC
dedicated to almonds. Yet their almond production is less
tried to explain “How Almonds are Sucking California
than 10 percent of California’s. Said another way, California
Dry.” Even our hometown paper, the Sacramento Bee
6 Almond Facts NOVEMBER | DECEMBER 2015
almond growers are more than 10 times more productive, seasoned almonds are the most successful new bold flavor of
efficient and sustainable than the next largest growing region. almonds since our Wasabi & Soy. Recognizing the desire for
a replacement for soy milk in coffee shops, we designed and
Blue Diamond growers understand the industry benefits of
launched a Barista Blend Almond Breeze that foams and froths
a co-op. In the northern half of the state, many almond
to the standards expected by the most particular coffee shop
growers are also walnut growers. Lately, at grower town hall
baristas. In Japan, at Asia’s biggest coffee trade show, I met
meetings, the most common question I receive is “Mark,
the world champion barista. She was kind enough to make
when are we expanding into walnuts?” While I also love
me a cappuccino with Almond Breeze Barista Blend. And it was
walnuts, one of Blue Diamond’s advantages is our laser focus
delicious! Already, in Australia, Barista Blend will be our
on almond innovation. With bold flavored snack almonds,
second biggest flavor. In the U.S., look out for this winning
the Almond Breeze beverage business, Nut*Thins gluten-free
product in Panera, Dunkin Donuts, Jamba Juice or your
crackers and a branded ingredient business, we have shown
favorite local coffee shop.
how innovation can grow dynamic and profitable businesses.
Sometimes my frequent travels lead my family to believe
Two years ago in Sacramento, we built the world’s first
that I visit all 93 countries that purchase Blue Diamond
Almond Innovation Center. Since that time we have invited
products. Fortunately, we rely on a great team who for years
food scientists from the great food companies of the world
has traveled the world opening new markets for almonds.
to join our R&D team in creating the next generation of
One of those everyday heroes is Blue Diamond’s Director
great almond product innovations. Shortly after the grand
of International Ingredient Sales, Warren Cohen. Since
opening, we hosted our German customer, Ritter. You
joining Blue Diamond, he has spent over 1,000 nights in hotel
better know them as the makers of those delicious chocolate
rooms and has flown over a million miles. Said another way,
almond bars packaged in green squares. Together, for two
Warren has circled around the world more than 40 times
days, our teams collaborated on innovation. They created
opening markets and keeping customers loyal to the best
many delicious prototypes. The winning idea was a new
almonds in the world, yours!
seasonal flavor for the German market, honey roasted
almonds in chocolate. The product became Ritter’s flavor In the last five years, we also began taking the Blue Diamond
of the year. It exceeded all sales expectations and honey brand and U.S. product innovation to the consumers of
roasted almonds in chocolate is now a permanent flavor in the world. You can now buy flavored Blue Diamond Snack
their product line. Almonds in 45 countries and also pour a delicious glass of
Almond Breeze in 45 countries. International retail is our
most rapidly growing business.
We are the unusual food business that is averaging 20
percent growth. Even in a short crop year, Blue Diamond
grew its annual revenues by over $200 million! In addition
to rising market prices, Blue Diamond added new member
acreage and focused a short crop of almonds on value-
added sales. We are nearing our revenue goal of $2 billion,
and we remain very optimistic in our growth opportunities
with almonds.
Our mission is to maximize the returns of each grower
who entrusts Blue Diamond with their almonds. Once again,
our payments surpass the value paid by other handlers in
the industry. You can see that our historic $.02 a pound
advantage, in recent years, has become at least $.07. This
year was a good year, but we will not break our arms
patting ourselves on the back. Our goal is to consistently
beat other handlers by $.10 a pound. While Blue Diamond is
We are also continuing to innovate behind our Blue Diamond
delivering the best returns, there is still work to be done to
brand. Some of our recent new product successes are the
achieve our goals.
world’s best almond flour, which is produced on the newest
In addition to your competitive return advantage, your full
manufacturing line in our new Turlock facility. Our Sriracha
return at Blue Diamond also includes tax advantages that
NOVEMBER | DECEMBER 2015 Almond Facts 7
Total Competitive Return Advantage
R
E
N $0.35
R
O $0.30
C
$0.25
S
’
T RETURN
$0.20
N
IC DISC
E
$0.15
D DPAD
I
S $0.10
E
R
$0.05
P
$0.00
2010- 2011 2012 2013 2014 2015
Blue Diamond Average Selling Price
$5.50
2014
$5.00 2015
$4.50
$4.00 2013
$3.50 2012
$3.00
$2.50 2011
$2.00
Harvest Harvest Winter Spring u m m er
- S
e
r
P
other handlers are unable to offer. For more than 10 reports that the prices of almonds are falling. Allow me to
years you have been getting DPAD benefits which have give some context. The chart above describes the prices
given an additional $.02 to $.04 after tax. Last year, Blue at which the crop has sold. For the previous 3 crop years,
Diamond became the only almond handler and first co-op the winning call pool strategy has been to wait until after
to offer IC-DISC advantages. This gave our average harvest, and even into the winter, before selling. This year
grower an additional $.14 per pound after tax. We are prices peaked before harvest and then softened. At Blue
still completing the accounting, but this tax benefit looks Diamond we sell throughout the year, including pre harvest
to be a nickel higher for the 2014 crop year or your 2015 peak prices. Through October we were selling at prices
tax returns. This extraordinary savings would not have higher than the same time last year. You can expect your
happened without the encouragement of your Chairman returns on the 2015 crop will be very competitive and
Dan Cummings and the tenacity of your CFO Dean likely your highest ever.
LaVallee. These pioneers take all the arrows and seldom
Last year your Blue Diamond membership team signed
get the thanks they deserve.
up more than 14,000 additional acres of almonds.
I remain optimistic in the 2015 return for almonds. Some Certainly, the financial benefits of joining our co-op
of you have heard from the coffee shops or almond trader are important. Possibly more compelling is that you are
8 Almond Facts NOVEMBER | DECEMBER 2015
joining a partnership with the most dedicated people in the Here is another reason our agriculture is unique. Across the
industry. Last summer, Mike Griffin, your Blue Diamond field entire globe, only Chile has a similar geography and climate
representative for Fresno to Madera, was in a horrific bike to California’s Central Valley. Fruits, vegetables and nuts
accident. He broke his pelvis, sternum and three ribs. His not only should, but must come from California. It is our
shattered bike helmet likely saved his life. Three weeks after legacy and responsibility to feed the world healthy food. With
the accident, while he should have been on bed rest, Mike recognition of the value of California agriculture and the
surprised us. It was a hot July evening at the Easton Portuguese innovative genius of this state, I am convinced we can create
Hall for our District 8 meeting. With the help of his wife, Gail, adequate water storage and conveyance solutions.
and a walker, in hobbles Mike. We were shocked. He stood
In the Central Valley we elect strong agriculture advocates
there with a walker, because he could not easily sit, and greeted
to all levels of political leadership, but they are outnumbered
his growers - just as he has for the last 23 years!
at the state and national level. We must help them by taking
At Blue Diamond, Mike’s story is not unusual. For inspiration, a more active role in spreading the agriculture story. We can
he had to look no further than our Director of Membership, invite urban legislators to our farms and ag related businesses.
Mel Machado. Last Spring, shortly after his promotion to We can visit and write state representatives who come from
Director, Mel began losing his hair. Mel was quick to point outside the valley. Most importantly, we can use the tools of
out “Mark is not the reason.” With great openness and modern social media to call out, correct and educate.
optimism, Mel then said, “I have cancer and I am going
It is appropriate that we say thank you to all the employees
to beat it.” As his wife Pam says, “Mel just isn’t wired to
of Blue Diamond who never worked harder to deliver a
take a day off.” Even when he was struggling with chemo
competitive return. Thank you also to all our Blue Diamond
treatments on weekends, Mel was taking long weekend drives
growers, who in this historic drought, worked so hard to
through almond orchards. This fall we received great news.
deliver a crop. We are honored you entrust us with your
Mel announced, “I am cancer free!” I think he may want to
almonds. On a personal note, thank you to all my other
keep his new George Clooney haircut.
business partners, friends and mentors. As a relative
Even with the health challenges and new leadership, Mel newcomer, you have made me feel very welcome.
and your membership team had a great year. One of the
Earlier in my career, one of my mentors was the chairman
secrets to their success is teamwork. Whenever there are
of The Schwan Food Company. Alfred Schwan always
challenges, they pick up, pitch in and support each other.
ended his speeches with the sincere proclamation that
It also helps to have some great veteran leadership on the
“the best is yet to come.” Since joining Blue Diamond, I
team. Bob Ketcher is our longest tenured field man with
have borrowed that line as it describes my outlook for the
38 years of experience. As many of you know, Bob has a
future of the co-op. In considering the world treasure that
great sense of humor and is usually smiling. Bob tells the
is California agriculture, I fully believe that the state will
story of his first company car. It was not a pickup, but a
overcome its water challenges. When we band together with
green Caprice Classic. Bob would drive up to a grower’s
optimism, The Best is Yet to Come!
farmstead and see the workers scatter. They thought he was
the INS. Mel says, “Bob has been a go-to guy to get the
job done.” Bob has developed most of the procedures for
receiving grower almonds, and overseen outside receiving
stations and truck logistics. Most importantly he has been a
champion for the best interest of the grower.
California has changed the world through entertainment,
high tech, bio tech and yes, agriculture. How big is
California agriculture? The critics say just 2 percent of the
state’s GDP. We should respond “California’s ag is larger
than the ag economy in the next two largest ag states, Iowa
and Texas, combined.” The critics fail to mention that the
high tech industry in California is just 4 percent of GDP, or
the entertainment industry is 3 percent of GDP. California
is the 8th largest economy in the world and agriculture
generates over a million jobs.
Mel Machado Mike Griffin
NOVEMBER | DECEMBER 2015 Almond Facts 9
E
G
A
S
S
E
M Chairman’s Message

S
’
N
A Dan Cummings
M
Chairman of the Board
R
I
A
H
C
Finding Strength He joined because he had vision, understood the
benefits of scale in an agricultural commodities
in Our business, and wanted to participate in the vertical
integration of processing and marketing that Blue
Cooperative
Diamond afforded growers.
That was 90 years ago and I have to wonder what he’d
Adapted from 2015 Annual Meeting Remarks think now with Blue Diamond having become an iconic
food brand with over $1.6 billion in sales, actively
marketing to over 90 countries around the world
As family growers we take pride in the legacy that
and with an Almond Innovation Center creating a
came before us. I am proud to share a part of
seemingly unending stream of new almond products.
my family legacy with these 1928 and 1929 Blue
Blue Diamond Growers is, in fact, the industry leader
Diamond pool closing statements addressed to my
developing new products, new markets and expanding
grandfather, James Chester Cummings, framed
the use of almonds.
above my desk.
10 Almond Facts NOVEMBER | DECEMBER 2015