Slow Beginning Branches Into Record Year at Sunkist
Sunkist Growers, the giant citrus-marketing cooperative based in Van Nuys, reported Wednesday that what had been an unpromising 1988 turned into the firm’s best year, generating record revenue and earnings for its 6,000 farmers and packers in California and Arizona.
The results were reported at Sunkist’s 95th annual meeting, which was held in a sprawling exposition hall on the Ventura County Fairground, as rain lashed the coast and freezing temperatures threatened nearby orange and lemon groves.
But for now the focus was on last year, which also, recalled President Russell L. Hanlin, began with bad weather, lower-than-normal quality of fruit and a smaller-than-expected crop to market. All the same, he said, Sunkist’s sales and other revenue totaled $886.6 million, up about 4%, despite what he called “one of the poorest Valencia crops in memory.”
The cooperative paid $645.9 million of that to its members, a 4.4% increase over that paid in 1987, which also broke the record set in 1985.
Adding internally generated sales by Fruit Growers Supply, a sister company that produces packing materials and other supplies for Sunkist, made the cooperative a billion-dollar enterprise last year for the first time, Hanlin said.
However, domestic sales dropped $10 million last year because of the small crop and lower quality, he said. But export sales rose $35 million, the fifth straight yearly increase. Foreign sales benefited from the government’s “targeted export assistance” program, which provides supplementary financing for market development.
“At the same time,” Hanlin said, “we were terribly disappointed that the new treaty with Japan on citrus (and beef) did not address the enormous duties which must be paid on imported oranges in that country.”
Sunkist had sought to persuade U.S. trade negotiators to seek to reduce Japan’s tariffs on imported oranges instead of gaining entry for more fruit, judging that lowering duties first would eventually pave the way to increasing citrus import quotas. Florida’s citrus industry sought increased volume to augment exports of its specialty, orange juice.
The cooperative’s export goal this year is to open “the potentially large Korean market” for fresh oranges, Hanlin said.
The new fiscal year so far has produced uneven results, he said. Lemons and grapefruit “are off to quite a good beginning,” but the present navel orange crop was slow to reach marketable size and sweetness. Freezing temperatures just before Christmas hurt crops in some areas, while high winds damaged oranges in Southern California.
“We have undoubtedly sustained additional damage during the course of the past three nights, when temperatures dropped well below freezing,” Hanlin said, but he added that it is too soon to assess the extent.
