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OpEd Response to price inquires by John Decas 9/13/01 -- Several posters, including "Paul Revere," have posted comments about the present price of cranberry concentrate. "Paul Revere" claims to be a buyer of concentrate but obviously is not, because his comments show that he is totally uninformed. However, he has put my name out there, and I will not allow this kind of misinformation to go unanswered, only because all growers have a right to know what the hell is going on. First of all, Cliffstar, to the best of my knowledge, does not sell concentrate on the industrial market, so I am unaware of any Cliffstar concentrate price. Secondly, Ocean Spray is officially off the market to all buyers at any price at this time. This is the company that holds the surplus, has imposed a volume regulation on all growers, and refuses to sell its surplus. I have tried to buy concentrate from Ocean Spray since January. Can't be done. Who in heaven's name in our cranberry world has the power to demand and receive an explanation from Ocean Spray? The USDA does, but they are not politically allowed to hold Ocean Spray accountable for anything. I can name you several reputable juice companies that recently had orders rejected by Ocean Spray, even though they were willing to pay $25/gallon and more. Decas sold most of its concentrate last year (2000) at $19.50 and higher when others were at the $16-$18 range. This year and until recently we have sold all our product between $24.50 and $27.00. We have lost orders on at least two loads when we offered a price of $27.00. Those customers bought from Northland at $24.50. Northland may have raised their prices since then. Our present price is $26.50, with $27.50 as our objective until Ocean Spray and/or Northland raise prices above that level. I believe that $30.00 concentrate is the price level that would help sustain most growers and protect buyers by avoiding a total grower collapse, preserving an orderly market, and keeping prices from spiking wildly. Decas has never been the low man on concentrate pricing totem pole. Just the opposite. The trade, by and large, is sitting on the sidelines at this time because they do not believe that Ocean Spray will raise the price of concentrate as they claim they intend to. We hope that they do, and stand prepared to follow. Some buyers, however, hope to buy at lower prices because they hope Ocean Spray will cave in. When Ocean Spray caves, everyone is forced to follow. As to posting my market price weekly, I will fully agree if all other handlers will also agree. If they don't, I will be pleased to give a periodic report on concentrate pricing trends in similar fashion to this letter. I will, however, say nothing that puts me at a disadvantage to my competitors. I don't intend to be the next Hiller. Since Ocean Spray doesn't answer to me, I would challenge Ocean Spray growers to demand answers from their directors as to why Ocean Spray is not selling their surplus, and if indeed they intend to raise the price of concentrate following the harvest as they have stated. I am skeptical because they are hammering the price on other ingredients. Furthermore, I do not believe that Ocean Spray growers have the collective fortitude to demand accountability of the managers and directors of their company. It is a pathetic thing to witness. The result is that Ocean Spray management and their chosen growers hold this entire industry hostage. I will not be lectured on the issue of price. My 300,000 barrel handle has no power or influence to drive prices up or down. Ocean Spray handles millions of barrels and holds nearly all of the surplus, and could unilaterally raise prices if they choose to. Instead, they are using this power to "clobber the competition" with predatory practices, and in doing so, they are killing what was once a great industry. Ocean Spray growers have lost control of their company. Don’t expect Decas or any other Independent to solve the problem that only Ocean Spray growers can solve by taking back control of the company they own. One final comment. Decas will lose over 100,000 gallons of concentrate sales of existing market share, as well as about 50,000 gallons of new sales that we could have achieved from the new crop because of the volume regulation. I believe it is fair to say that Ocean Spray will get that business. This is the direct result of the Ocean Spray-USDA collaboration to enhance the co-op monopoly without enhancing the well-being of co-op grower-owners. I have been as forthcoming as I can. Hopefully other handlers will follow.
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