After our mornings visit exploring the vast irrigation network of the district we then headed to Blue Diamond growers which is the world’s largest almond Co-op. With over 3000 growers and 1500 employees it became apparent how large a scale the co-operative, which was established in 1910, was operating on.
With California having over 1.3 million acres producing 83% of the world’s supply of almonds Blue Diamond puts itself at the top in terms of looking after and maximising profits for its farmers. Although they have had to stop accepting new growers at this moment due to lack of capacity, the normal pricing structure they adopt is designed to allow farmers to join the co-operative with minimum financial strain on their business. There are no large capital joining fees but instead the co-operative takes 3% of the farmers almond income for the first 3 years. This accessibility along with the growing demand for almonds has allowed Blue Diamond to expand rapidly over the last 20 years reaching its first billion dollar crop in 2002 and they are now on target to be up to 2.8 billion in 2019.
There is a lot to be learned from working together in a Co-op the way Blue Diamond operates. Due to their large networking campaigns and processes to add value to more than 2/3 of the almonds they receive they can consistently offer their growers above market value. Last year they were able to pay growers over 26 cents/kg more than their competitors. Growers understand how important marketing is and pay fluctuating amounts to an almond marketing board depending on how short they believe they will be on demand. A proactive approach like this has allowed there to be minimal waste in this sector meaning farmers do not have to dump crops. Husks are also sold to local dairy farmers as a fibrous feed stock helping to maximise crop income.
When it came to discussing the actual growing of almonds the figures were quite staggering. At 6-7k dollars an acre to establish plus 3-5k/acre irrigation set up this was starting to look like a very expensive crop to grow. Not only that but variable costs can be as much as 3.2k a year then labour, machinery and water costs on top of this. To make this huge start up fee even more overwhelming it will be 3 years till the first crop then 8-11 years to break even by the time the plant gets up to full production.
In terms of agronomy farmers face big challenges growing what turned out to be a very sensitive tree to its surroundings. They are well suited to the Mediterranean climate of warm summers and low humidity to produce the crop and cooler misty winters to allow them to regenerate and bloom. The pollination of almond trees is the largest pollinating event in the world with vast amounts of farmed bees being used. Once they are in growth the trees can use as much as a staggering 90 gallons of water a day most of which is received from large reservoirs catching snow melt up the valley or underground aquifers. Weather is key as to cold or warm can affect the crop dramatically. Frost can be a big problem in the winter so farmers have had to adopt methods to help reduce this. These include keeping the ground around the trees bare to be used as a natural heat bank for the sun's rays and also use of mist irrigation during frost to try and help insulate natural heat within the plant.
Overall it was a very interesting trip which I think we can take a lot away from. The very proactive approach they take working with large companies to produce new products and deal with market supply and demand is vital. This allows them to maximise profits for their growers whilst building a sustainable and ever growing market for their products.