Decas crunches surplus numbers:
"Ocean Spray has bulk of inventory"

John Decas, left, as David Farrimond explains marketing order.

"We're not looking for a battle with Ocean Spray," say Decas,
"I don't want to polarize the industry now that we have an opportunity to work together."

2/5/00 -  Wareham, MA - John Decas, CEO of Decas Cranberry Company, in remarks following a presentation about a potential cranberry marketing order made by David Farrimond, presented the results of his own analysis of the cranberry inventory. While Farrimond knows these figures, he is forbidden by law to reveal them.

According to Decas, Ocean Spray has, by far, most of the surplus. Decas Cranberries has no surplus.  He says that Northland has most of the independent surplus. Decas used information he considers accurate and came up with the following figures.

August 31st Inventory

Decas told an audience composed of his growers and several members of the press that he was against a marketing order. He agreed with David Farrimond that it was vital to the industry to sell more fruit overseas, he went further in saying that the solution to the industry crisis was not in a marketing order; but rather was in Ocean Spray and Northland each unilaterally destroying any of their inventory that they do not expect to utilize before the next harvest. He thought that the estimated  $250,000 expense of implementing a marketing order could be better utilized to grow the market through generic international promotion.

What many growers and industry analysts have believed for some time, Decas expressed bluntly in stating that he opposed a marketing order because it was an issue of fairness. His own growers would be hurt because they wouldn't get paid for a percentage of their crop (most people suggest 20%), while Decas Cranberries, with no surplus and needing to replace that 20%, would be forced to buy the fruit from the Cranberry Marketing Committee. In regards to the surplus that has thrown the cranberry industry into chaos and threatens to put from 20-30% of cranberry farmers out of business, he said "we didn't create it, but it effects us."

Decas clearly believes that the cause of the crisis can be laid at the doorstep of Ocean Spray, and their encouraging cooperative members to plant far more acreage than could be sold. Additionally, Decas, who has been on the Cranberry Marketing Committee since 1962, noted that several years ago Ocean Spray denied any possibility that there might be a serious surplus in the future. In fact, Decas pointed out, that they not only encouraged new acreage in the United States, but did the same in Canada. A number of Ocean Spray Directors even put in significant acreage in Canada.

Now Canada is viewed by Decas and many present at the meeting as a significant part of the problem. Canada exports about 80% of their fruit to the United States. They cannot be covered under a marketing order. They are at a further advantage in that their regulatory climate is far more permissive, plus they apparently receive governmental assistance in other forms. The unfortunate irony of the Canadian situation is that if there is a marketing order, while growers in the United States will be losing the income from 20% of their crop in order to reduce inventory; Canadian growers will be shipping ever more fruit into the United State as their new acreage comes into production.

As of today, Decas has not talked to Robert Hawthorne, the new CEO of Ocean Spray, although he looks forward to doing so. "We're not looking for a battle with Ocean Spray," say Decas, "I don't want to polarize the industry now that we have an opportunity to work together." He would like to see Ocean Spray work with the independents in the generic promotion of cranberries, especially overseas. In recent years, Ocean Spray was known to be highly competitive, sometimes even ruthless, in its competitive practices against the independents.  Now with drastic changes in the industry, and a new CEO at Ocean Spray, this may change. While not the monopoly it was, Ocean Spray is still the world leader in cranberries. Any successful international promotion where Ocean Spray isn't already entrenched as market leader, can only help their bottom line.

The issue of implementation of a marketing order is highly controversial, with most growers appearing to be against it since the surplus could be eliminated simply by Ocean Spray, and to a lesser extent, by Northland. The idea that desperate growers might try to sell the 20% of their crop they couldn't sell to their handlers on the street corner was discussed at today's meeting. Everyone seemed to agree that it would be a public relations disaster if a grower, who would be breaking Federal law if he violed the marketing order, was cuffed and hauled off to jail because he was trying to avoid foreclosure.

Both Decas and Farrimond left no room for doubt that drastic measures must be taken to reduce the surplus. There are so many berries in freezers that by 2001, growers could simply not harvest their entire crop and current demand could be filled from inventory.

Read related article in the Standard Times