A report published by Farm Credit Canada, updated in December 2012, titled Update on the North American Greenhouse Industry, states that the North American greenhouse vegetable industry operates in a dynamic market where growers must balance consumer demand for high-quality, low-cost vegetables with the need to keep their own operating costs in check.
Canada, Mexico and the U.S. will remain target markets for growers well into the future. The report states that Mexican competition challenges Canadian, and U.S. growers to compete against operators with advantages in labor costs, regulatory requirements and weather conditions. For example, in addition to high tech hydroponic greenhouses, Mexico's greenhouse vegetable industry also uses low-cost shade house construction, giving growers there a competitive advantage over field-grown production through improved water and pest management, an extended harvest and increased yields. Shadehouses are also more cost-efficient to operate than enclosed hydroponic greenhouse facilities.
With its recent rapid growth, Mexico's greenhouse vegetable production is now three times that of the rest of North America. But in recent years, greenhouse overbuilding in Mexico has led to the demise of some businesses. Overbuilding began as a result of previous government programs that provided grants for protected greenhouse vegetable construction. Some operators entered the sector without adequate production knowledge or marketing channels, and lacked realistic business plans or sufficient capital.
Canada's greenhouse vegetable sector has become a major player in the North American marketplace and now has a leading market in the U.S. Hydroponic greenhouse construction in the U.S. in on the rise, and much of that new construction is being done by Canadian greenhouse companies.
Canadian greenhouse companies have held firmly to their market even against competition. They have persisted through trade actions, energy crises, economic downturns, exchange rate fluctuations, food-safety issues and escalating input costs.
The Canadian greenhouse vegetable industry has succeeded because it is led by operators who, according to research by Zbeetnoff Agro-Environmental Consulting, are world leaders for several reasons. They effectively use integrated pest management and innovative greenhouse technologies as well as new technologies that improve their operations by increasing water and energy conservation. Canadian hydroponic greenhouse producers also grow superior quality specialty vegetables with higher flavor and color. And they have improved traceability and food-safety systems to meet the demand of today's buyers.
A review of Canadian, Mexican and U.S. vegetable markets points to the continued strong growth in demand for greenhouse vegetables, and likely at the expense of field grown vegetables. The increasing volume of greenhouse vegetable sales indicates that consumers are receptive to greenhouse products, and historical pricing patterns show that greenhouse produce continues to provide value that isn't always offered by field-grown alternatives. But it is also notable that hydroponic greenhouse production is, at least for now, limited in the number of crops that can effectively be produced, and at acceptable market prices.
The quality of field grown and low technology protected crops is good and continues to improve. But in what hydroponic greenhouses do produce, primarily tomatoes, cucumbers and peppers, they match the quality of even the highest quality field-grown products.
Production timing further differentiates greenhouse products in the marketplace. Greenhouses provide more protection and controlled growing environments than are possible in field grown conditions, which are susceptible to climate changes and other unpredictable weather conditions.
The hydroponic greenhouse sector is gaining a reputation for highly effective food safety protocols and outstanding reliability. For a growing number of food industry distributors and retailers, the costs associated with weather disruptions, food safety issues, customer requirements and recalls in field agriculture are simply too expensive. As a result, they're adopting zero-tolerance approaches to risk in their procurement strategies.
Still, the price for which greenhouse products can be sold in relation to the field-grown competition remains a determining factor for consumers, and although demand has increased, prices per kilogram or pound of greenhouse vegetables are declining as a result of stiffer competition from both imported and field-grown vegetable growers.
Over the last decade, the greenhouse sector has profitably employed marketing strategies such as increasing its product mix and developing year round supply relationships and alliances, leading growers and distributors to consolidate to service large retailers. Canadian greenhouse growers have taken significant steps in trialing new varieties, growing proprietary varieties and diversifying into new products. Consumers continue to show interest in organic greenhouse vegetable production and some are prepared to pay a premium for these products.
Local produce is increasingly well received, and even demanded by consumers and foodservice operators who perceive it to be better quality, and they are committed to supporting companies in their local communities. Today's smaller-scale greenhouse operations have significant opportunities to capitalize on this by supplying niche markets and regional populations that larger operations can't accommodate. Niche markets are increasing as growers implement marketing strategies focused on providing what consumers want: local origin, taste and color appeal, smaller sized produce and packaging and convenience.
Farm Credit Canada's report suggests that, in the near future, quality-driven production will be a requirement for all competitors. Increasing supply chain integration and building business-to-business relationships are proven methods of acquiring and keeping markets.
Several operations in British Columbia, Ontario and other Canadian provinces have opened facilities in the U.S. to increase their winter production, decrease shipping and energy costs and take advantage of the 'Grown in the USA' label. Distributors in Canada have and continue to contract with Mexican hydroponic growers to obtain greater volumes and increase their ability to offer products year round. This, in turn, allows them to further increase their presence in the U.S. market.
Homegrown Organic Farms has announced its sublicense agreement with The Giumarra Cos. to grow and distribute the recently announced DulceVida proprietary line of premium stone fruit.
The agreement with Giumarra grants Homegrown Organic Farms with specific rights to grow and market certified organic product, and the San Joaquin Valley-based grower will have access to all Nature’s Partner DulceVida stone fruit varieties.All DulceVida organic production under the sublicense will be distributed by Homegrown Organic Farms and all conventional production will be distributed by Giumarra.
“We are thrilled to have access to the DulceVida proprietary program," Scott Mabs, chief executive officer of Homegrown Organic Farms, said in a press release. "Giumarra has always been on the cutting edge of varietal development and we are proud to work with such a well-respected company."
Homegrown Organic Farms expects its first commercial organic crop of organic DulceVida varieties to be harvested in 2016.
“Homegrown’s organic supply of DulceVida stone fruit will naturally complement Giumarra’s DulceVida conventional tree-ripe program,” Jeannine Martin, director of sales for Giumarra Reedley, said in a press release. “In our planning for retail and customer expectations, we recognized the organic piece as a key part of servicing retail markets. We are proud to work with such a well-respected company as Homegrown Organic Farms.”
Stephen Paul, sales category manager for Homegrown Organic Farms said, “The DulceVida fruit eats exceptionally well and we are anxious to get into our commercial organic production. I think our customers will be pleased with the uniqueness of this line and this addition will only enhance the already diverse Homegrown stone fruit program.”
LA QUINTA, CA — The National Watermelon Association unveiled a new logo and launched a new website at its 101st annual convention, here.
Bob Morrissey, executive director of the NWA, said the new website, www.watermelon.ag, replaces www.nationalwatermelonassociation.com and is now active — though certain parts are still under construction and will be active in the next couple of weeks. He said feedback about the food-safety content has been extremely positive so far.
In fact, he said Danny Gurwitz, the attorney who represented Frontera Produce, which recently settled claims in the 2011 Listeria outbreak attributed to cantaloupe,said the association has some of the best food-safety content of any website.
Additionally, Vineline, the association’s quarterly magazine, with the latest information about research news, produce legislation, watermelon queen reports and upcoming events, is now available at the site.
Morrissey said the association initiated its logo project because “we realized we needed to brand the association, but we didn’t have a brand that identified us.”
He said the NWA put out a call for logo designs and received 180 results in the first 30 days. It was then whittled down to the top 10 choices and the executive committee chose its top three, which were then presented to the association membership. The winner was chosen and unveiled at the convention.
“We particularly liked the circular graphic around the watermelon wedge because it indicates the global nature of our industry,” he said.
In other news, Morrissey said that next year’s convention will be held in New Orleans and will have a Mardi Gras theme. The 2017 convention is to take place in Lake Tahoe, followed by Nashville, TN, in 2018. In 2019, the convention makes its debut on the Big Island of Hawaii.
Steve Grinstead, former chief executive officer of Pro*Act, has launched The Grinstead Group, which will specialize in executive placement, financial and succession planning, and other business strategy development services. The Dallas-based company will serve companies and professionals across the food industry.
With over 40 years of serving the fresh produce industry, Grinstead’s connections with and knowledge of the entire supply chain equip the new company to make an immediate and positive impact on the groups and individuals with whom they engage.
Executive placement and alignment comprise one area of specialty for Grinstead’s new venture. “People are most every company’s best assets,” Grinstead said in a press release.“Finding experienced and skilled professionals is only one component of the executive placement process, however. We specialize in aligning companies and executives to ensure a proper behavioral and cultural fit.”
The Grinstead Group, which also includes Michael Grinstead, who recently graduated from the University of Florida with a bachelor's degree in marketing, has also developed a proprietary process for optimizing businesses and teams. The specialized business optimization process focuses on team analysis, succession planning, financial preparedness, and merger-acquisition planning.
“I feel very blessed to have called the fresh produce industry ‘home’ for my entire career,” Grinstead said in the release. “Throughout that time, I have had a wide range of experiences, all of which taught me valuable lessons that now enable me and The Grinstead Group to help companies successfully navigate challenging business decisions and emerge stronger and better prepared for future growth.”
The Grinstead Group will be developing additional business services specific to the food industry and customized specifically for client goals and needs. For more information about the company, visit www.thegrinsteadgroup.com.
Sunkist Growers announced the cooperative’s fifth consecutive billion-dollar revenue year at the company’s annual meeting Feb. 18, with 2014 grower payments increasing to $1.1 billion from $873 million in 2013.
“An extended cold period in December 2013 posed challenges, but the dedication and hard work of our growers and shippers, in combination with a disciplined sales strategy, allowed us to achieve positive results,” Russell Hanlin, Sunkist president and chief executive officer, said in a press release.
Sunkist issued its second grower distribution in 2014, a program made possible by strong results from Sunkist’s for-profit businesses. “Our for-profit businesses continue to contribute positive revenue streams and also help position Sunkist for future success,” added Hanlin.
Sunkist’s licensing program continues to grow. Notably, last year the cooperative announced a licensing agreement with India’s Future Consumer Enterprise Ltd, one of the fastest growing retail and consumer packaged goods companies in India. New partnerships in India and other significant global markets such as Brazil continue to extend the prominence of Sunkist’s brand globally. With 49 licensees in total, the "Sunkist" brand is used to market approximately 700 products in 77 countries.
“We also continued to realize the benefits of our juice processing partnership, which has resulted in improved by-products earnings, more timely payments and significant contributions to our grower distributions,” said Hanlin. “In the third year of this partnership, Sunkist’s business arrangement with Ventura Coastal continues to be important in our efforts to optimize efficiencies, and we look forward to continued strong results to benefit growers.”
The seamless and efficient completion of Sunkist’s corporate office move from Sherman Oaks to Valencia, CA, in September 2014 was another significant event for the cooperative. The relocation, offering an investment opportunity, further strengthened Sunkist’s financial position while also bringing the cooperative headquarters closer to its growers.
“Sunkist, as a 120-year-old organization, has a rich history that this new space honors along with updated technology that helps us better communicate with our customers and partners,” Kevin Fiori, Sunkist's vice president of sales and marketing, said in the release. “Sunkist is well-positioned for growth in the current marketplace and we look forward to continuing the legacy of the cooperative from our new home in Valencia.”
Mark Gillette, president of Sunkist-affiliated Gillette Citrus Inc., was re-elected as chairman of Sunkist’s board of directors during the meeting. “We are pleased to be recognizing our success last year, but more importantly, we are optimistic about the future of the cooperative as a result of the strategic initiatives that Sunkist has undertaken,” said Gillette. “Sunkist is the leading brand for California fresh citrus and we look forward to continuing to provide high-quality fruit to our partners worldwide.”
Founded in 1893, the Sunkist cooperative of family farms offers more than 40 fresh citrus varieties and remains a brand that has been trusted by customers and consumers for over a century. With thousands of grower members in California and Arizona, the Sunkist cooperative reflects the values and legacy of its over 120-year history: family-owned farms where traditional growing practices, stewardship of natural resources and a dedication to innovation are proudly passed through the generations.
Founded under the principle that more can be accomplished by working together, Sunkist continues to promote a culture of family and collaboration with growers and customers to drive beneficial results for all. Sunkist offers a full range of cartons, bags, display masters, bins and reusable plastic containers, which have been designed with customers’ needs in mind. The company provides customer-specific creative marketing and promotional support to retail and foodservice trade designed to build consumer excitement, demand and sales.