Amid a year of transformation and strategic growth, Sun-Maid Growers of California, for the first time in 30 years, has decided not to sign as a Raisin Bargaining Association (RBA) signatory packer for the 2018 raisin crop. Despite active negotiations between both parties over the past months, the RBA 2018 crop price proposals were seen by Sun-Maid as too high and unsustainable, and therefore Sun-Maid rejected all proposals.
CEO and president of Sun-Maid, Harry Overly, explained the two-pronged rationale behind the cooperative’s position: 1.) Sun-Maid has no data-driven rationale to justify 20% increases based on market dynamics and global supply, and 2.) As the world’s largest processor and marketer of raisins, Sun-Maid contends that the global market cannot sustain another price increase and will lead to further price volatility. US share of the global market for raisins continues to slide. US pricing, already elevated due to a short crop in 2017, has provided a firmer foundation for foreign origins to develop their infrastructure and compete against the US at discounted prices.
“When looking at global supply dynamics, all indications point to a greater supply of dark raisins across the world versus last year,” said Overly. “Demand, on the other hand, is not increasing.”
“Sun-Maid’s intent remains clear—stabilize the market to minimize price volatility,” said Overly. “This benefits all parties, including growers and handlers, and allows the industry to focus on growing the demand for our fine product. Increasing the demand for raisins will lead to firmer pricing and justifiable steady price increases. For Sun-Maid members, this allows for continued strong and stable grower returns.”
Sun-Maid proactively engaged all of its 2018 cash growers over a month ago citing concerns over the pricing proposals. To avoid as much inconvenience as possible to this set of growers, Sun-Maid offered the option of a cash contract release and assistance with transitioning tonnage, if needed, at their request. While a few cash growers are working with Sun-Maid to transition their tonnage, other independent cash growers have evaluated Sun-Maid’s position and elected to become members of the cooperative.
Founded in 1912, Sun-Maid Growers is the world’s largest marketer of raisins and other premium quality dried fruits. Located in Kingsburg, California in the heart of the San Joaquin Valley’s raisin producing district, Sun-Maid products are distributed throughout the United States and in more than 50 countries around the world.
For more information about Sun-Maid, visit www.sunmaid.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20181023005814/en/
Contacts:
Sarah Pruner
spruner@jsaweb.com
