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California Almonds: We’ve Come a Long Way
Almond Board of California’s (ABC’s) consumer marketing program as we think of it today began almost 20 years ago. At that time, almonds were considered an unhealthy food. We’ve come a long way since then. Today, almonds are touted for health benefits and are an on-trend ingredient, being the most preferred nut for global new-product introductions since 2012.1 During this time, the California Almond crop has grown by 1.5 billion pounds. That’s a 417% increase — from 366 million pounds to 1.9 billion pounds. Over the next three to four years, we anticipate an incremental 500 million pounds of additional production. Protecting the markets we have created and generating additional demand for almonds would be challenging even in a perfect world. But there is a plan. Through our global demand analysis, ABC has a process to focus and prioritize our investments. Currently, ABC executes programs in eight different countries. The prioritization and investment are overseen by the Global Market Development Committee (GMDC). Programs currently exist in the U.S., Canada, United Kingdom, France, Germany, India, China and South Korea. As we look to the future, we consider both new markets and expansion in these current markets. Adding New Markets When it comes to adding new markets, it takes time to determine which opportunities to focus on, and time for the marketing efforts to cultivate demand. We also know that one market alone cannot absorb the expected crop increase, so we are using our trusted process to help us focus and prioritize work in the markets that will have the greatest impact. In 2016, we conducted a market opportunity assessment for Japan. As a result of that assessment, we are in the process of building out a trade and consumer public relations program for the GMDC to review this spring. And, we are currently evaluating an investment in Mexico. A team recently returned from that country as part of our market opportunity assessment work. Much like Japan, we will be sharing a recommendation for Mexico to the GMDC this spring. We continue to monitor Brazil as an exploratory market for future program considerations. Expansion in Current Markets While we want to continue to look for opportunities in new countries, we also are aware there is continued growth upside in many of the countries we currently invest in. With that in mind, we are already expanding our investment in the U.S. to increase our reach with the millennial consumer. In India, we’ve added advertorials and additional public relations programs to ensure we keep up with the demand coming from that market. In addition, we expanded our program in Germany after research uncovered an opportunity to capitalize on the relatively new snacking culture. To date, we’ve only had a small PR program there. The dramatic rise in production we are expecting has to be met with a dramatic proactive response on the marketing side, to ensure market demand grows to absorb the additional volume. That is exactly what is happening as we plan for crop year 2017–18, which starts on August 1, 2017. We will confront the evolving challenges in the industry, continue to invest our resources to best support the almond supply coming online, and wisely allocate the money entrusted to the Board by the almond industry.
Long-Term Growth Seen for Emerging Markets
The Almond Board of California’s (ABC) Emerging Markets Subcommittee was formed to focus on development of key markets that have great growth potential for California Almonds but require more efforts in marketing fundamentals, and therefore need a longer time to realize the benefits of promotional efforts. The ABC’s Global Market Development Analysis, completed in 2011, revealed that the top emerging market opportunities for California Almonds are China, India, S. Korea and Russia. China is the largest growth market among all markets based on incremental volume potential, and the top priority for emerging markets due to projections that the current volume of almond consumption could double there within the next three years. A significant market attractiveness factor in emerging markets is the enormous consumer potential with growing middle class populations that are able and willing to pay more for high-quality, nutritious foods such as California Almonds. For example, per capita annual consumption in China among target consumers is currently only 0.13 pound per person, but with projected growth over three years, it could reach up to 0.70 pound per person of almonds — an increase of 538%. While all marketing programs conducted by ABC cover the cornerstones of market development — market access, trade stewardship and marketing — by definition, emerging markets are in the transition stage or middle of the development life cycle. If you’d like to follow Emerging Markets Subcommittee activities, see About the Almond Board on the Almond Board website.
Book Your Accommodations for The Almond Conference
Hotel rooms for the 2017 Almond Conference will open on Tuesday, Aug. 1, at 9 a.m. PST. Rooms may be reserved online at almondconference.com and by calling the hotels directly. Visit the Location/Hotel Information tab for local hotels offering a discounted rate for Almond Conference attendees. Pre-registration is open now and can be completed on the same website. Registration is complimentary with no charge to attend. Please note that at the time you reserve your accommodations, a non-refundable deposit equal to one (1) night's stay (plus taxes) will be charged. No refund will be given for this night if the reservation is cancelled at any time. Participants are required to manage their own hotel reservations. Although we acknowledge this reservation policy is strict, please understand that in the past, the Almond Board has been charged for all cancelled guest rooms. In addition, a maximum of three rooms can be booked in one person’s name. Now in its 45th year, The Almond Conference reached several notable milestones in 2016 including surpassing 3,500 registrants and 260 exhibitors. As the largest event for almond industry professionals in the world, The Almond Conference is a one-of-a-kind opportunity to connect with the people, the science, the products and the trends at the forefront of the global almond community. The Almond Conference will take place Dec. 5-7, 2017, at the Sacramento Convention Center.
Hope For Pollinators
The State Board of Food and Agriculture met recently to hear an update on pollinator issues related to farming and the environment. The meeting brought together academics, agricultural representatives, beekeepers and environmental stakeholders to discuss the current status of pollinators.
FSMA Files: Straight Talk from the Experts on Compliance
Welcome back to our FSMA Files column! This month, we’re focusing on questions we’ve received regarding FSMA compliance dates. These questions are timely, as FDA recently announced a delay in the compliance dates for the agricultural water requirements in the Produce Safety Rule. We’ve also fielded a number of questions about whether operations are considered farms or facilities and how to cancel a facility registration with the FDA. Please keep your questions coming! You can send them to Tim Birmingham at firstname.lastname@example.org with the subject line “FSMA Files,” and we’ll be sure to address them in upcoming columns. Question: When does FSMA compliance begin? Straight Talk: Your FSMA compliance dates depend on the specific rule that applies to you. This is related to the size of your business and whether FDA has delayed any portions of the rule applicable to you. For example, FDA has delayed the compliance dates for the written assurance of commercial processing requirements in the Produce Safety, Preventive Controls and Foreign Supplier Verification Programs (FSVP) Rules and has announced plans to delay the compliance dates for the agricultural water requirements in the Produce Safety Rule. For a better idea of how different rules apply to different business, read on. Explanation: Each FSMA rule has its own set of compliance dates. These dates vary based on the size of the operation, as defined under each rule. Generally, a “large business” is a business with more than 500 full-time-equivalent (FTE) employees. A “small business” is typically defined as fewer than 500 FTE employees. Each of the rules has its own definition of a “very small business,” which is based on food sales plus the value of food held without sale (see the next question below regarding these dollar amounts). In addition, due to various comments regarding implementation challenges, FDA has delayed the compliance date for certain components of the rules. Specifically, FDA has announced plans to delay the compliance date for the agricultural water requirements in the Produce Safety Rule. The original compliance dates for these requirements were set to begin in January 2020 (but certain sampling would have had to begin sooner). FDA is exploring ways to simplify these requirements after receiving feedback from stakeholders that some aspects of the rules are too complex to understand and implement. FDA has not yet determined the new compliance dates, as “the length of the extension is under consideration.” Other extended compliance dates address: The requirement to obtain customer assurances for food that will be subject to further processing. Note that the original compliance dates remain in effect for the requirement to disclose that a hazard has not been controlled when relying on a subsequent entity to control the hazard. Compliance with the Preventive Controls rules for facilities solely engaged in packing and/or holding activities conducted on nut hulls and shells. This extension covers almond brown skin facilities that only size, sort, grade or pack almonds, as well as facilities that only hull and shell almonds, as long as the facility does not engage in manufacturing or processing activities (i.e., chopping, grinding, mixing, roasting, pasteurizing, salting). Compliance with the Preventive Controls rules for facilities that would qualify as “secondary activities farms” except for ownership of the facility. Facilities that meet the definition of “secondary activities farms” except for the ownership criterion can take advantage of an extension for compliance with the Preventive Controls rule if: The operation is not located on the primary production farm; The operation is devoted to harvesting, packing and/or holding of raw agricultural commodities (RACs) (including operations that hull, shell and/or dry nuts without additional manufacturing); and The operation is under common ownership with the primary production farm that grows, harvests and/or raises the majority of the RACs harvested, packed and/or held by the operation. Examples of common ownership include: An operation owned by (or that owns) one or more primary production farms (e.g., a packing house owned by a cooperative of individual farms) Operations that are managed within the same business structure as the primary production farm (e.g., the farm and packinghouse are separate operations owned by parents and their children, respectively, and both operations are part of the same business jointly owned by the parents and the children) In general, FDA has delayed compliance by two years in order to align the Preventive Controls rule compliance date with the Produce Safety rule compliance date for those facilities that can look to the Produce for compliance guidelines. For specific compliance dates with each of the FSMA rules, please explore the resources available at almonds.com/growers/fsma. Question: What is the definition of a “very small business” for the purposes of determining FSMA compliance dates? Straight Talk: Each of the FSMA rules has its own definition of a “very small business”. “Very small businesses” are typically exempt from complying with the rule. Determining whether or not you qualify for this exemption is based on the dollar value of sales of human food plus the market value of human food manufactured, processed, packed or held without sale (e.g., held for a fee). There are baseline values set in each of the FSMA rules, but FDA will adjust these values over time due to inflation. Thus, the exact cutoff value will change from year to year. Basic guidance is provided in the table below. Explanation: Each FSMA rule has its own definition of a “very small business” based on the value of food sales and food held without sale. “Very small businesses” are exempt from rule compliance due to their size, as defined by sales. The rationale is that these operations do not have the resources to comply with the rule and exempting them represents a low risk to the food supply. Because the compliance obligations and risks are different from rule to rule, the sales values that determine the definition are different as well. An operation must review the definitions in each FSMA rule to determine whether it meets the definition and to determine its compliance date. FDA will adjust the baseline values established in the regulations for inflation at the end of March each year. To do this, FDA will use the federal calculation for the gross domestic product price deflator, provided by the Bureau of Economic Analysis. Below we provide a table with the average three-year inflation-adjusted values for the FSMA rules, which are the values that need to be taken into account when determining whether an entity meets the very-small-business-related definitions under the various FSMA rules as of 2017. By way of example, the Preventive Controls for Human Food definition of “very small business” includes a threshold of an average of “less than $1 million, adjusted for inflation, per year, during the 3-year period preceding the applicable calendar year in sales of human food plus the market value of human food manufactured, processed, packed or held without sale (e.g., held for a fee)” (emphasis added). Using the inflation-adjusted values provided by FDA, in 2017 a facility’s average annual income now would need to be below $1,065,291 to qualify as a “very small business.” FSMA Inflation-Adjusted Cut Off Values Regulation and Definition Baseline Value for Cut-offs (2011) Average 3-Year Value for 2014 - 2016 Preventive Controls for Human Food: “Very Small Business” $1,000,000 $1,065,291 Preventive Controls for Animal Food: “Very Small Business” $2,500,000 $2,663,227 Produce Safety Rule: “Qualified Exemption” $500,000 $532,645 Produce Safety Rule: “Not Covered Farm” $25,000 $26,632 Foreign Supplier Verification Programs: Human Food: “Very Small Importer” $1,000,000 $1,065,291 Foreign Supplier Verification Programs: Animal Food: “Very Small Importer” $2,500,000 $2,663,227 Sanitary Transportation of Human and Animal Food: “Non-covered Business” $500,000 $532,645 Intentional Adulteration: “Very Small Business” $10,000,000 $10,652,906 Question: If my farm is registered with FDA, but based on the new definition of a “farm” I am not required to register it, what should I do? Straight Talk: If your operation was previously registered with FDA, but now no longer needs to be registered, you should cancel the registration. Explanation: Operations that meet the definition of a farm do not need to register with FDA. If your operation was registered, but now meets the definition of a “farm” under the new regulations, you should cancel your registration. You should go online to FDA’s facility registration portal and cancel your registration electronically (through https://www.access.fda.gov/). Alternatively, you can cancel your registration by paper (mail or fax). This form is available here: https://www.fda.gov/downloads/AboutFDA/ReportsManualsForms/Forms/UCM072017.pdf. You will be asked to provide information such as registration number, facility name and address. This column was prepared by Elizabeth Fawell and Maile Hermida, who are lawyers with Hogan Lovells US LLP in Washington, DC. The FSMA Files column is provided for informational purposes only and does not constitute legal advice.
Spring Bee Losses - A Reminder to Follow Best Practices and Improve Communication
The California Department of Pesticide Regulation (DPR) and U.S. EPA are investigating losses of adult and immature bees rented for almond pollination that were observed and reported this spring. There are a number of factors at play, and while the facts aren’t all in, two patterns have emerged. First, losses appear to have occurred in almonds as a result of tank-mixing insecticides with bloom fungicides. Based on new information, the Almond Board of California (ABC) has recommended avoiding insecticide applications during bloom since 2013. A number of insecticides are registered as safe to bees on the basis of low adult toxicity; however, recent information indicates some may be harmful, particularly to young developing bees in the hive. Second, bee losses appear to have occurred as a result of bee exposure to chemicals applied in other crops planted in the vicinity of almonds; this was particularly the case after almond bloom was over and pollination completed. The tank mixes of insecticides with fungicides applied in almonds and associated with bee losses were not a label violation. The EPA and DPR are evaluating information with an eye toward including warnings on product labels when justified, but this will take some time. In the interim, the Almond Board of California, beekeepers, the University of California and California regulatory officials are diligently working collaboratively to provide information on best management practices in relation to pesticide application to all the groups and audiences involved. Regardless, heading into the 2015 pollination season, it is extremely important to remind almond growers that when making pesticide applications at bloom to continue to follow ABC’s best management practices: Avoid applications of insecticides during bloom until more is known about the impact on bees; and Minimize exposure of bees and pollen to fungicides by avoiding applications when pollen is available and bees are foraging; spray only after mid-afternoon and at night. In addition to the above, more must be done to strengthen the chain of communication about bloom-time pesticide practices and applications among all parties involved in pollinating almonds and/or applying pesticides to orchards. Prior to bloom, all parties should agree on products that can be applied in the orchard and the methods and timing of application. During bloom, additional communication is necessary on products, methods, timing and target area of spray applications to be made. Communication should start with the contract between grower and beekeeper, and be maintained all the way through the chain. In larger operations, communicating along this chain can be extensive and include beekeeper-broker-owner-farm manager-pest control adviser-applicator. A second area of attention should be aimed at minimizing almond post-bloom losses resulting from bee exposure to chemicals applied in other crops. Once almond pollination is done, bees placed in almonds are at risk to pesticide exposures in other crops because they extend their foraging range well beyond almonds. Communicating with the beekeeper/broker the guidelines for when almond pollination is complete and hives can be picked up will be key to minimizing these losses. In future articles, the Almond Board will be reviewing these guidelines as well as other pollination and bee health best practices. The Almond Board is committed to bee health and its partnership with beekeepers. A key goal is to ensure almond orchards continue to be, based on research and our efforts, a good, safe place for honey bees to forage — a place that keeps them healthy and where hives increase in size. cide Regulation (DPR) and U.S. EPA are investigating losses of adult and immature bees rented for almond pollination that were observed and reported this spring.
MRL Workshop to Focus on IPM and Export Issues
California Almond growers, PCAs and handlers who ship to export markets must constantly be aware of the maximum pesticide residue levels allowed by each market. A workshop to provide a practical overview of maximum residue levels (MRLs) science and policy issues is being offered to help attendees understand the evolving regulatory requirements of our global trading partners. The April 2 meeting, to be held at the Visalia Convention Center, will provide practical insights on how MRLs are developed and how they drive pest management programs, export business and what the future looks like for global trade. The program is organized by AgBusiness Resources and meeting sponsors. Presentations will include MRL basics, constraints and challenges to integrated pest management, why MRLs differ in various parts of the world, complexities of using residue decline curves, MRL database tools, GlobalGAP and trade agreements. Speakers include Barbara Madden, U.S. EPA; Becky Sisco, IR-4 Minor Use Registration Program at UC Davis; Nirmal Sanai, CDFA; Bob Mills, GlobalGAP; Mickey Paggi, CSU Fresno Center for Ag Business, Kimberly Berry, Bryant-Christie, Inc.; a registrant panel and others. The 8:30 a.m. to 2:30 p.m. program includes lunch, and 4 hours of PCA credit will be offered. Online registration is available at $125. Onsite registration will be $150. For meeting information and online registration go to www.mrlworkshop.info.
Farming for the Future
Sustainable1 practices learned from Almond Board–funded research will help keep farm going for future generations. Matt Visser’s office in the restored milk house at Visser Family Farms sits in two worlds — the world of his great grandfather, who purchased the property in 1919 and built the dairy’s milk house, and in Matt’s world of technology, which reflects his modern management style and dual career of almond grower and professional photographer. While his great grandfather had to learn from experience and what little farming information was offered at the time, Matt has access to years of production research results through the Almond Board of California. The first almond orchards were planted on the farm by Matt’s grandfather in 1963. Matt and his brother Patrick replaced the old orchards block-by-block from 2000 to 2008, following Almond Board–supported variety trial research results to determine variety selection, spacing and other factors. “The old orchards were flood-irrigated and had only 67 trees per acre,” Matt recalls. “Now, our orchards are laser-leveled, micro-sprinkled/fertigated and have 110 trees per acre. My brother and I had one shot in 25 years and we wanted to do it right. Cutting one little corner on planting is shortsighted — it’s a 25-year investment.” Since redeveloping the orchards and following irrigation and fertility practices guided by Almond Board research, yields have nearly tripled, and, in fact, their best-producing blocks have had consistently high yields in seven out of eight years, Matt reports. Matt currently serves on both the Almond Board’s Production Research Committee and Industry Services Committee. “Being a member of the Production Research Committee has given me a preview of research that can help me improve and refine our orchard practices,” he says. “We’re paying for this through our assessment dollars, and I want to take advantage of the research that’s being done. I’ve implemented a lot of the research results, particularly from the multiyear nutrient and water management studies.” Serving on committees is only one way that Matt takes advantage of opportunities available from the Almond Board. He has attended The Almond Conference nearly every December since the trade show was introduced. “I love the trade show,” he says. “All the vendors I use are there, giving me direct contact with them to ask questions about their products. “I never miss the research updates, either — the ‘speed dating’ presentations. I’m familiar with the research projects through Production Research Committee meetings, but this gives me a quick overview of the progress and results.” It was at The Almond Conference in December 2009 that Matt learned about the Almond Leadership Program, which he signed up for the following year. This led to attending committee meetings as a Leadership member, and eventually becoming a member of the Production Research and Industry Services Committees. “Serving on these committees is a good way to give back to the almond industry,” he notes. “This has been a family farm since 1919. I love the heritage and the history, and I want to pass that along to my four kids,” concludes Matt. “Participating in Almond Board activities has helped me to refine sustainable growing practices that will carry this heritage into the future.” Learn more about participating in Almond Board committees and programs. 1. Sustainable almond farming utilizes production practices that are economically viable and are based upon scientific research, common sense and a respect for the environment, neighbors and employees. The result is a plentiful, nutritious and safe food product.
Almonds Are America’s New Favorite Nut
The Washington Post’s “Wonkblog” reported last week that “America has a new favorite nut,” citing USDA figures1 that the country’s appetite for almonds has grown by more than 220% since 2005 — much faster than demand for pecans, walnuts, macadamias, pistachios, cashews or peanuts. In fact, the article notes, almonds have surpassed peanuts in popularity, as “in 2012 Americans ate more almonds per capita than shelled and unshelled snack peanuts combined (not including peanut butter)2.” The article attributes almonds’ growing popularity to nutrition research and changing consumer perceptions of fat, falling demand for meat, an increasing interest in plant-based protein sources, and increasing demand for convenient, satisfying and nutritious snacks. It adds, “The Almond Board of California happily touts the nut's nutritional benefits prominently on its website. No wonder no other nut is considered as nutritious by consumers." The tone of the article is very positive, with the exception of a link to a recent Mother Jones article that says almond milk is inefficient, and it’s better to eat whole almonds. That Mother Jones article, by the way, has been hotly debated by other media sources such as Slate and Gawker, giving almond milk an increasing amount of attention as sales continue to climb. Good news about fat. U.S. Dietary Guidelines recommend that the majority of your fat intake be unsaturated. One serving of almonds (28g) has 13g of unsaturated fat and only 1g of saturated fat. 1USDA Economic Research Service 2013 Fruit and Tree Nut Yearbook 2USDA Economic Research Service 2012 Food Availability Per Capita Data