A Message from the Executive Director
So much these days seems unsettled. Information is everywhere and it moves at breakneck speed. We’re left to figure out what’s true and make sense of it all. Without disciplined focus, it’s far too easy to chase the latest theory, veer off course, and miss our goals.
In Jim Collins’ business and leadership book Good to Great, he uses the “Stockdale Paradox” to remind readers facing extreme challenges to keep an unwavering faith to overcome the constraints. In other words, stay focused and keep believing.
Global market dynamics in the prune business have been very challenging in the past year. Excess inventory exacerbated by lackluster demand, cheap South American competition, tariff wars and stalled trade negotiations have created major impediments to profitability and growth. Further, stagnant economies in major export markets – such as the EU, China, Japan, South Korea and Canada – have hurt trade and consumer optimism for premium category leaders like California Prunes.
But there are some good reasons to be optimistic. According to Global Trade Atlas data, the average price per metric ton of prune exports from the U.S. remained stable, up 2% in in 2018/19 vs. the previous year. U.S. prune exports fared much better than Chile (down 4%), Argentina (off 10%) and the staggering 30% decline for France during the same period. Considering the significant price disparity between California Prunes and much of the competition, our commitment to premium quality is paramount and the cornerstone of our promotional efforts.
While trade negotiations have a significant impact on our shipments, particularly to China, Hong Kong and indirectly Vietnam, we have persevered. Although prices have taken a hit, volumes in those markets were 8% higher than the low point two years ago. And efforts to gain support from the Trump administration as a result of the China tariffs have succeeded, securing nearly $2.5 million in additional Ag Trade Promotion (ATP) funding for promotions Those dollars pay for promotions in many countries, including Japan, Canada, and South Korea while looking at new markets in the Gulf region and Mexico.
Our work to grow the partnership with USDA/Agricultural Marketing Service has led to timely purchases of California Prunes, helping shoulder the impact of current challenges while building a foundation for a more robust, long-term means of providing schools with California Prunes, which helps introduce a new generation to prunes. USDA purchases in 2018/19 totaled 2,592 tons /$8.5 million, with an additional purchase of 3,240 tons /$9.27 million coming just after the close of the fiscal year.
Staying optimistic while confronting our challenges, the new California Prunes brand is available for members. The brand is a declaration of our leadership role in producing the highest-quality prunes in the world while providing a basis for telling our story to all stakeholders. Please join us and an increasing number of trading partners by incorporating the brand into your activities. See the new brand section of the annual report for more details and ways you can start putting this investment to work.
On behalf of the entire team at the California Prune Board, I would like to thank everyone who contributes to making our programs the best they can be by investing their valuable time and resources. We hope you’ll review all sections of the annual report and, as always, please reach out if you would like more information.
“Together, let’s stay focused and never stop believing in California Prunes.”