Cranberry Stressline

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4/20 - 4/23/00

Decas critical of Ocean Spray in letter to growers
Quinn announces $1 million for Cranberry Research and Outreach
Researchers Find Potential Additional Health Benefit of Cranberries
"Ocean Spray's brilliant foray into raisin territory"
Massachusetts has awarded half of million dollar cost to town of Pembroke, MA., to buy Northland property for open space

Decas critical of Ocean Spray in letter to growers

4/20/00  Excerpts:

"I believe that Ocean Spray, as a matter of strategy, has decided to kill two birds with one stone and get it done as soon as possible. Whatever the reason or motivation for them to have accumulated a three million barrel surplus, they now realize it must be reduced quickly. They also realize all growers cannot be saved in the process, so by quickly driving prices and returns to historical lows, growers will be unable to grow full potential crops and, indeed, many growers will go out of business while, at the same time, these predatory pricing practices will gain back market share by killing off competition.

"They believe they can put Northland in receivership while targeting Decas as their main competition in the ingredients category. I do not believe they will achieve either, but they are inflicting a lot of pain on us and other Independents but ironically mostly on their own growers.

"The second reason we calculate a historical low return to Ocean Spray growers is because of their pricing practices. Ocean Spray is just destroying the value of all cranberry products across the board by discounting all categories to the point where they are virtually giving away cranberry products, both industrially and at the retail level. There is nothing left in our industry that can be described as a value-added product, with the possible exception of fresh fruit. Everything else we sell has become nothing more than a commodity. I fear that even fresh fruit will be reduced to that level with the 2000 crop."

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"We, as your handler, are investing in the future. Despite the way things are, we believe in the future. We are spending considerable sums in the promotion of cranberries, we continue to invest in R&D to accommodate new markets with new and improved products, we are planning an expansion of our production plant, and we plan to build a new and modern fresh fruit plant to be ready for the 2001 crop.

"We will consider any opportunity to develop strategic alliances with other companies that will result in successfully expanding our ability to sell more berries. We anticipate success in this regard in the near future.

"Any continued attempt to inflict illegal harm upon our growers and us will be dealt with in the appropriate fashion. It would appear at this point that legal conflicts within our industry are inevitable. Whether such conflicts will include our company remains to be seen. There is a limit to what we are willing to endure."

Read entire letter here | Easy to print version