SANTA PAULA, Calif. — It was an unusual sight for mid-December.
The avocado groves surrounding the rural Santa Paula headquarters of Calavo Growers Inc. were besieged with fruit. The tops of branches that had not been staked were bending almost to the ground.
“The quality of this year’s crop is fantastic, and prices should be reasonable,” said Rob Wedin, Calavo’s vice president of sales and fresh marketing.
The company’s two Southern California packinghouses will ship about 30% of all avocados grown in the state, he said.
If there are upward fluctuations in prices, the hikes will likely occur in early summer, Wedin said.
Ventura County is home to the headquarters of two of California’s avocado giants: Calavo Growers Inc. and Mission Produce Inc., in nearby Oxnard.
After a near disastrous 2009 deal, all of California’s avocado grower-shippers were predicting an above-average crop, especially in the cooler coastal growing regions of Ventura, Santa Barbara and San Luis Obispo counties.
Harvesting in that northern region usually follows by a few months picking in the southern region, Riverside and San Diego counties.
This season, picking began early in the north as growers harvested larger fruit in late December and January, Wedin said, to give the smaller avocados a chance to size up.
Up 10% statewide
Overall, California’s avocado acreage will be up about 10% over 2009.
“Lots of trees in the south were stunted (cut back) after the 2007 wild fires and to salvage them in the face of the drought,” Wedin said.
The resurgence of volume at Calavo is not attributable to drought or disaster. It’s due to maturing groves.
“We’re in the process of replanting or grafting 100% of our acreage,” Wedin said. “Our groves will be viable for decades.”
About 80% of the replanting-grafting project was completed by the end of 2009, he said.
2006 wake-up call
In 2006, California growers produced a bumper crop, about 600 million pounds.
“That was a wake up call for Calavo,” Wedin said. “The drop in prices was uncomfortable.”
The company redoubled its efforts in its V-I-P, or verify internal pressure, ripening program and introduced consumer bags. The ripening program uses acoustic firmness sensors to determine the ripeness of the fruit, Wedin said.
“We have 13 full-load ripening rooms here in Santa Paula, and we have similar facilities in Texas and New Jersey,” he said.
In 2007, Calavo introduced the Ripe Now stickers. The stickers and the 1.5 million bags produced monthly have had a positive effect on sales.
“They move the fruit,” Wedin said.
Calavo, which Wedin said is about 50% grower owned, remains committed to growing organic avocados, a segment of the category that is growing much faster in Mexico, he said. A drawback for organic growers is that they are not seeing the production numbers they would like, he said.
Avocados remain the No. 1 performer in Calavo’s annual sales of about $350 million followed by tomatoes, pineapples and processed products. The company has marketed Calavo guacamole for several years.
“Our guacamole really helps the sales of our fresh avocados,” said Lee Cole, president and chief executive officer.
Calavo adds salsa
In February, the company added a new product to the refrigerated fresh line with the acquisition of 65% of Lisa’s Salsa Co., St. Paul, Minn.
“Our customers had been asking for salsa, but finding the right company was easier said than done,” Cole said.
Calavo began immediately marketing the salsa, but the new Calavo Salsa Lisa label will likely debut in April.
Cole said he envisions Calavo Salsa Lisa displayed in produce departments along with the company’s several varieties of guacamole.
Mision Produce adds Canadian facility
Oxnard-based Mission Produce opened a Toronto ripening center in February, the company’s eighth ripening center and the first in Canada, said Ross Wileman, vice president of sales and marketing.
“We started the modified-atmosphere ripening centers 10 years ago,” Wileman said. “We provide our customers with just-in-time delivery within eight hours after receiving the order.”
An equally high priority at Mission is getting all of its acreage — and that of its growers — GAP certified.
“It’s the right thing to do, so we seized the opportunity,” Wileman said.
As the company entered 2010, more than 30 growers were already GAP certified, he said.
Mission is committed to its California growers, Wileman said, but the company also has a commitment to its retail customers. The company provides retailers with a side variety of sales tools ranging from recipe cards to point-of-sale materials.
“We do all of our own production in house,” said William Tarleton, director of marketing communications.
Mission Produce sees challenging days ahead for the California avocado industry, particularly the southern growing region. Encroachment, the increasing cost of farmland and the state’s nonstop water woes are forcing a cutback in producing acreage in the south, Wileman said.
“We can only hope the stability of the coast region will offset losses in the south,” he said.
Production in Chile, Mexico and Peru will dominate the category, Wileman said, but Mission is working closely with its California growers to help them remain profitable.
The company’s efforts include training growers to maximize yield. It is not an industry for the financially faint of heart.
“Growers who put money in the land do reap dividends,” Wileman said.
Not all of Mission Produce’s avocados are sold fresh. The company’s Mr. Avocado line of guacamole, offered in 7- and 14-ounce containers, is available from the company’s eight ripening centers, Tarleton said.
Mission completed a series of major roof-to-floor conservation projects during 2009. The collective projects reduced power consumption by more than 25% with a corresponding lowering of the company’s utility bill. The projects improved product quality and permitted Mission Produce to pass along the savings to customers, Tarleton said.
Refrigerated fresh products and reduced energy consumption blacken the company’s bottom line. But fresh avocados are still the engine that drives the category, Wileman said.
“The mesh bags help promote avocados, but the key is ripe avocados on the shelves,” he said.