California Walnut Commission Marketing for the Future May 6, 2004 - PDF document

May 6, 2004 California Walnut Commission Marketing for the Future California Walnut Commission Marketing for the Future May 6, 2004 Strategic Planning � In March 2003, a two day strategic planning retreat was held. � Current State Analysis � Future Direction � Develop Strategic Focus Areas � Define & Implement Action Plans Dennis A. Balint, Walnut Marketing Board 1

May 6, 2004 California Walnut Commission Marketing for the Future The Current State Analysis � Strengths � Weaknesses � Opportunities � Threats Walnut Production - Linear 375,000 350,000 325,000 300,000 275,000 250,000 225,000 200,000 175,000 150,000 125,000 100,000 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Dennis A. Balint, Walnut Marketing Board 2

May 6, 2004 California Walnut Commission Marketing for the Future Our Future Direction � The industry will increase utilization by 50 million shelled pounds (116 million inshell pounds – 58,000 tons) over the next five (5) years. � We will focus on our key markets! � US, Japan, Germany, Spain, schools and food banks, etc � Evaluate China and India Area of Strategic Focus � Marketing � Health � Production Research � Government Relations Dennis A. Balint, Walnut Marketing Board 3

May 6, 2004 California Walnut Commission Marketing for the Future Learning from Experience � Shipment Data � Market Intelligence � Imports � Level of Competition � Price premiums Shipment Data Dennis A. Balint, Walnut Marketing Board 4

May 6, 2004 California Walnut Commission Marketing for the Future Shipments to Japan Inshell Equivalent Short Tons 25000 20000 15000 10000 5000 0 85 87 89 91 93 95 97 99 1 3 Shipments to Japan Shelled Pounds (000) 20000 18000 16000 14000 12000 10000 8000 6000 4000 2000 0 85 87 89 91 93 95 97 99 1 3 Dennis A. Balint, Walnut Marketing Board 5

May 6, 2004 California Walnut Commission Marketing for the Future Shipments to Germany Shelled Pounds (000) 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 85 87 89 91 93 95 97 99 1 3 Shipments to Germany Inshell Pounds (000) 40000 35000 30000 25000 20000 15000 10000 5000 0 85 87 89 91 93 95 97 99 1 3 Dennis A. Balint, Walnut Marketing Board 6

May 6, 2004 California Walnut Commission Marketing for the Future Shipments to Korea Shelled Pounds (000) 4000 3500 3000 2500 2000 1500 1000 500 0 85 87 89 91 93 95 97 99 1 3 Shipments to Israel Shelled Pounds (000) 7000 6000 5000 4000 3000 2000 1000 0 85 87 89 91 93 95 97 99 1 3 Dennis A. Balint, Walnut Marketing Board 7

May 6, 2004 California Walnut Commission Marketing for the Future Shipments to Israel Inshell Pounds (000) 1600 1400 1200 1000 800 600 400 200 0 85 87 89 91 93 95 97 99 1 3 Shipments to Spain Shelled Pounds (000) 6000 5000 4000 3000 2000 1000 0 85 87 89 91 93 95 97 99 1 3 Dennis A. Balint, Walnut Marketing Board 8

May 6, 2004 California Walnut Commission Marketing for the Future Shipments to Spain Inshell Pounds (000) 35000 30000 25000 20000 15000 10000 5000 0 85 87 89 91 93 95 97 99 1 3 Shelled Walnut Exports Pounds (000) 70000 60000 50000 40000 30000 20000 10000 0 85 87 89 91 93 95 97 99 1 3 Dennis A. Balint, Walnut Marketing Board 9

May 6, 2004 California Walnut Commission Marketing for the Future Shelled Success � Since the 1985/86 crop-year � Shelled walnuts exports are up 650% � The export share of shelled shipments is up from 9.5% to 32.7% � The export market is the premium market � Shelled utilization is up 88% Inshell is Still Important � Early shipments � Maintain traditional markets � We enjoy a comparative advantage � We can stimulate shipments after January 1 Dennis A. Balint, Walnut Marketing Board 10

May 6, 2004 California Walnut Commission Marketing for the Future Shipment History Second Half of Crop-Year 100,000 90,000 80,000 1,000 Pounds 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 1999 2000 2001 2002 Shelled Inshell Foreign Competition � France (28M MT) � Italy (17M MT) � Turkey (77M MT) � India (25M MT) � Chile (12M MT) � China (350M MT) ? Dennis A. Balint, Walnut Marketing Board 11

May 6, 2004 California Walnut Commission Marketing for the Future China – Market or Menace � Production levels in doubt � Potential is unquestionable � Economy is strong � Internal consumption is up � Exports are down dramatically � WTO? The Wonderful World of WTO � Free Trade Agreements � Japan and Korea � Could China strike a deal? � Will tariffs come down in the WTO Doha Round? � Will we benefit from the US/Korea renegotiation of the rice regimen? Dennis A. Balint, Walnut Marketing Board 12

May 6, 2004 California Walnut Commission Marketing for the Future The $64 Question! What Does the Future Hold � There are many variables. � Half full/half empty? � Productivity the key! � There will be markets – at what price? � How strong will the health message be? Dennis A. Balint, Walnut Marketing Board 13

May 6, 2004 California Walnut Commission Marketing for the Future The Current Marketplace � US � Japan � Germany � Spain � Israel � Canada � Korea The New Marketplace � China � EU Development � The Middle East � Increased utilization in the current marketplace! Dennis A. Balint, Walnut Marketing Board 14

May 6, 2004 California Walnut Commission Marketing for the Future Conclusion � The California walnut industry will enjoy success over the next decade. � Threats do exist but so do opportunities Dennis A. Balint, Walnut Marketing Board 15