On October 15, 2009, the CAC Board adopted a 2009-10 Business Plan and Budget that provide for an aggressive marketing effort aimed at moving a bumper crop of around 470 million pounds. A record two-thirds (66.6 percent) of the overall $13.5 million budget, or $9 million, will be spent on marketing. This roughly equals the marketing expenditures by CAC in 2005-06, when crop volume reached 600 million pounds—the largest in recent history. The 2009-10 marketing programs will build on the success of the California Avocado Grower campaign with Hand Grown in California thematic, reaching out to consumers in additional markets across a longer period of the harvest season.

In addition, CAC will continue to have a robust production research program, with 8.7 percent of the budget or $1.18 million being spent on a variety of high-priority research projects to address pest and disease issues, as well as the physiology and cultural management of avocado production. Industry affairs and administration account for the remaining portion of the budget, at $1.06 million (7.9 percent) and $1.77 million (or 13 percent, after fee offsets from the Hass Avocado Board and Avocado Inspection Program), respectively. The spending plan will be funded through a 1.95 percent CAC assessment rate that becomes effective November 1, 2009, which is a decrease from the current rate of 2.62 percent.

Management’s overall objective is to do more with less, while keeping the California brand strong. In the upcoming year, CAC is hopeful of reducing overhead further still, through the relocation of CAC headquarters to smaller offices. As the year progresses, much of our financial analysis and management will focus on attempting to bring some stability and predictability to the CAC assessment rate, so that growers can plan accordingly. We appreciate the remarkable patience exhibited by those growers who have been calling for change for some time now, and we hope that the approved 2009-10 budget and assessment rate are viewed as being a solid step in that direction.

A Mediterranean fruit fly infestation has been detected in the Fallbrook area of San Diego County. Two adult male Mediterranean fruit flies were detected in one trap on October 29, and a mated female fly was detected in another trap on November 1. The California Department of Food and Agriculture has posted a map on its Web site that shows the detection sites and the boundaries of the area in which sterile flies will be released as eradication efforts get underway. This can be found at: http://www.cdfa.ca.gov/phpps/PDEP/treatment/maps/MED_SIT_FALLBROOK_09_GMAP_110209.pdf

Note that this is NOT the quarantine zone. Quarantine is anticipated, but boundaries have not yet been delineated. Also, the relationship, if any, between the Medfly detections in Fallbrook and those in Escondido is not yet known, nor has CDFA released any information on how existing quarantine boundaries might be affected.

For more information, contact the Mediterranean Fruit Fly Quarantine Project office at (760) 510-4703.

Wyatt Buchanan, Marisa Lagos, Chronicle Sacramento Bureau

(11-04) 12:36 PST Sacramento - The sweeping overhaul of California's water system that lawmakers passed Wednesday relies on borrowing $11 billion that supporters hailed as a necessary investment in safe, reliable water statewide but that critics warned is overpriced and could siphon money from health and education.

The historic legislation, praised by Gov. Arnold Schwarzenegger, enables the state to closely control water delivery and use statewide. It imposes strict conservation rules in urban areas and supports the restoration of the Sacramento-San Joaquin River Delta ecosystem. It also paves the way for the construction of dams, levees and a controversial canal to bypass the delta and carry water from the Sacramento River to Central and Southern California.

The state's voters would decide in November 2010 whether to approve the $11 billion general obligation bond that would pay for much of the work needed to upgrade a water system that officials said was built for 16 million people but serves about 38 million statewide.

30-year debate

The idea of revamping the state's water system had been debated for about 30 years.

"This Legislature did something that no Legislature has been able to accomplish in decades," said Senate President Pro Tem Darrell Steinberg, D-Sacramento. The package's success, he said, shows that the Legislature "can tackle the biggest and most intractable problems in the state."

Lawmakers passed the legislation at about 6 a.m. after they pulled an all-nighter. They said the three-year drought, the delta's ecological deterioration and the dire water shortage that left hundreds of thousands of farm acres fallow created the political will to get something done.

The water package consists of five major parts:

1. A new seven-member board to oversee the Sacramento-San Joaquin River Delta. The board would have the power to approve a controversial peripheral canal around the delta.
2. A 20 percent conservation mandate for urban areas, with credits for cities - such as San Francisco - that have made significant conservation efforts. Agricultural entities would have to follow best practices for water use.
3. New regulations to monitor groundwater levels throughout the state.
4. Increased penalties for illegal water diversions, although the penalties and enforcement were significantly weakened from an earlier plan.
5. An $11.1 billion bond to pay for the overhaul.

The bond was the center of much of the debate, with some lawmakers pushing for a revenue bond, which means it is repaid by fees of water customers. But instead lawmakers chose a general obligation bond, which means the debt would be repaid through the state's anemic general fund, which has seen a series of multibillion-dollar deficits since January 2007.

That prospect caused many more-liberal lawmakers to oppose it, as it could mean cuts to other areas such as education, parks and health care to pay the debt. The nonpartisan legislative analyst's office estimated that at the peak, repaying the bond could cost upward of $600 million per year.

Sticker shock

Sen. Mark Leno, D-San Francisco, voted against the bond, along with most other Bay Area lawmakers. He said its sheer size could affect voter support.

"I think there could be sticker shock," Leno said.

But Assembly Speaker Karen Bass, D-Baldwin Vista (Los Angeles County), said she did not think it would be a tough sell once voters look closely at the issue.

"I think there needs to be a lot of education, especially in the Los Angeles area, about the crisis and how fragile our water infrastructure is," she said.

Some legislators complained that the bond contained pork for pet projects.

"I believe this measure is so bulked up with pork that it is going to sink under the weight of its own pork when voters are asked to vote on it next year," said Assemblyman Chuck DeVore, R-Irvine, who voted against the bond.

The bond initially included $10 million for a Capital Unity Center in Sacramento that would focus on building unity and diversity. Steinberg is the president of the board of the organization developing that center and said it would be a "good fit" with the bond. Ultimately, though, the Assembly stripped funding for the center before passing the bond.

Sen. Dave Cogdill, R-Modesto, who authored the bond measure, said the state's general fund will not take a hit for years.

"The first five or six years the impact will be small - only half of the bond can be sold before 2015, and we expect that by then the economy will be better," he said.

Environmentalists split

Environmentalists were also split over the wide-ranging package.

While Environmental Defense Fund and the Natural Resources Defense Council praised the water policy as an important step forward, some groups criticized the bond measure as too costly and said too many key provisions of the bills were weakened in the final weeks of negotiations.

The Planning and Conservation League and Sierra Club, among others, argue that the package's requirements for groundwater monitoring - California is one of the last Western states to have virtually no oversight over the water pulled from underground aquifers - lack funding and regulatory teeth. Under the package, the onus for groundwater monitoring will largely fall to local jurisdictions, which don't have the money for adequate programs, they said.

How the $11 billion bond would be spent

Voters will be asked in November 2010 to approve a general obligation bond to pay for the following:

Source: Gov. Arnold Schwarzenegger's office

Chronicle Staff Writer Kelly Zito contributed to this report. E-mail the writers at wbuchanan@sfchronicle.com and mlagos@sfchronicle.com.

http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/11/05/MN0O1AETO1.DTL

This article appeared on page A - 1 of the San Francisco Chronicle

Local California Avocado growers Emily Miles as well as Will and Billy Carleton were among those attending the grand opening in early October of the Whole Foods Market in Santa Barbara. This opening offered shoppers the chance to talk to growers who supply the store with locally grown food, get answers to questions about how their food is grown and to learn the specific history of food items as well as health benefits of each item.

According to their Web site, Whole Foods believes that Supporting local farm production puts a "face" behind the foods we consume and keeps us connected to the seasons, as well as the unique flavor and diversity of local crops and is permanently committed to buying from local producers whose fruits and vegetables meet their high quality standards, particularly those who farm organically and are themselves dedicated to environmentally friendly, sustainable agriculture.

The new Whole Foods is located at 3761 State Street, Santa Barbara, California.

Bottom-Line Protection for Avocado Growers

USDA Risk Management Agency Offers New Crop Insurance Options for Avocado Producers

Enrollment Period Closes NOVEMBER 30, 2009

To help protect avocado producers from extended financial losses due to crop failure, the USDA Risk Management Agency (USDA/RMA) has modified the pilot insurance program for Avocado producers.

New Program Highlights:

• The CAT or Catastrophic coverage is the entry level. CAT coverage is only $300 per commodity per county and meets Farm Service Agency eligibility requirement for the SURE disaster relief programs.
• Additional “buy-up” coverage levels ranging from 50 - 75 percent of a grower’s historical average yield are available.
• Coverage is now based on Actual Production History.
• Pre-established Price Election provides faster claims settlement.
• Quarantine Loss Endorsement is available.

Frequently Asked Questions

The following FAQs have been designed to address key issues to help growers assess the basic elements of the program.

Q1: What does the insurance cover?

Adverse weather conditions, failure of irrigation water supply, fire, insects, plant disease, wildlife, volcanic eruption and earthquakes are causes of loss which would initiate a claim.

Q2: How do I qualify?

Commercially grown Hass and Lamb-Hass avocados are eligible for irrigated acreage and trees that have reached the sixth growing season after being set out, or have otherwise produced 2,000 pounds of avocados per acre. Producers in Orange, Riverside, San Luis Obispo, Santa Barbara, San Diego and Ventura counties are eligible for coverage.

Q3: What are the coverage levels available?

Growers can choose a coverage level from 50 – 75 percent of their approved average yield and 55 - 100 percent of a price announced by USDA. Catastrophic (CAT) coverage based on 50 percent of production and 55 percent of the Price Election is the minimum coverage level for a flat fee of $300 per commodity per county. Additional “buy-up” options are per acre with premiums determined by production and price coverage, they can vary by county. For example, a 65/100 policy covers 65 percent of Actual Production History at 100 percent of the Price Election ($0.86/pound) – which is the RMA calculated price for the covered period (see Q5).

Contact a crop insurance agent to determine the level of coverage you desire under the premium and subsidy levels that you feel are best for your business.

For more detailed information about amounts of coverage and premiums to determine the level of coverage you feel is best for your business, contact a crop insurance agent or your local FSA office for a listing agent. A list of crop insurance agents is also available at http://www3.rma.usda.gov/tools/agents.

Q4: How is the Price Election calculated?

The Price Election is an on-tree price normally calculated on a three-year moving average. The pre-determined Price Election allows faster claims settlement. Without the Price Election, producers would have to provide documentation of income loss.

Q5: What is the period of insurance for an individual policy?

The November 30, 2009 closing date insures bloom in 2010 and crop in 2011.

Q6: How are losses calculated?

If production falls short of the guarantee chosen by the insured, a claim is filed. The loss is calculated by multiplying the production shortfall by the pre-determined price. The “Price Election” is the price used to calculate premiums and indemnity. These are calculated annually based on a moving average with the 2011 Price Election at $0.86 per pound. A producer’s guarantee is based on their Actual Production History. Producers provide 4 – 10 years of production records to the crop insurance agency as part of the underwriting application. Insurance requires certification of production records for at least the most recently completed crop year.

Q7: Can you give me an example of a loss calculation?

The loss is based on the shortfall in production multiplied by the price election along with your chosen level of coverage. The assumptions for the example are as follows:

• Actual production history (APH) of 8,000 pounds yield per acre
• Actual production for coverage period of 4,000 pounds yield per acre
• 65% coverage
• 100% of price election
• Price Election of $0.86 per pound

8,000 lbs. per acre average yield (APG)

X .65 coverage level percentage

5,200 lbs. per acre guarantee
4,000 lbs. per acre actually produced
1,200 lbs per acre loss
X .86 Price election
$1,032 Gross indemnity (loss) per acre

Q8: What do I need to do?

Contact a crop insurance agent in your area to begin the application process, if coverage is desired.

Q9: What is the deadline for registration?

The enrollment period ends November 30, 2009.

Q10. Is crop insurance necessary to receive disaster relief?

Yes. Producers must have at least CAT coverage to be eligible for disaster relief. Coverage must be in effect before the emergency. For information about disaster relief programs and requirements go to www.fsa.usda.gove/ca

Quarantine Endorsement

Q11. What are the basic requirements of the Quarantine Endorsement?

Those who purchase “buy-up” levels of insurance are also eligible to purchase a Quarantine Endorsement Pilot which is available for California avocados and citrus. This additional policy is available for producers in the same counties as covered by the base insurance program.

Q12: How does the Quarantine Endorsement work?

• The qualifying quarantine must mandate crop destruction or preclude harvest prior to destruction; or restrict harvest, sale or transportation during which the fruit becomes unmarketable.
• This endorsement will only cover actual production losses. Additional costs of treatment, harvest, packing or transport are not covered.
• This pilot program will not cover losses due to missed marketing opportunities caused by quarantine.
• A grower’s field must be within the specified quarantine zone as imposed by the authorized regulatory agency, CDFA or APHIS.
• Actions which still permit movement of the fruit from the location are not considered quarantine for the purposes of this endorsement.
• The Quarantine Endorsement is not available at the CAT coverage level – only “buy-up” coverage can purchase the Quarantine Endorsement.

Please go to http://www.rma.usda.gov/pilots/2010/ca_aph_avocado_crop_provisions.pdf or talk to your crop insurance agent for details and restrictions.

Researchers from University of California, Los Angeles (UCLA) recently conducted a study on the phytonutrient content of California Hass Avocados. The study was supported by the California Avocado Commission (CAC) through an unrestricted educational grant. The results of the research were recently published in the Journal of Agricultural and Food Chemistry. The release was distributed over the business wire and has been published broadly in consumer and trade media resulting in more than 28,623,300 impressions. FreshPlaza distributed the story in their weekly “Global Produce News” e-mail distribution on November 2, 2009 (see below):

Click here to view the full FreshPlaza article

Led by David Heber, M.D., Ph.D., Director of the UCLA Center for Human Nutrition, researchers studied California Hass Avocados harvested in January, April, July and September 2008 from San Luis Obispo, Ventura, Riverside and San Diego and analyzed the fruit for total fat content, fatty acid profile, carotenoids and vitamin E.

The study identified four additional carotenoids in the California Hass Avocado, which had not been quantified until this study. In addition, the researchers reported that the total carotenoid concentrations were greatest in the dark green flesh of the avocado closest to the peel. Carotenoids are a class of phytonutrients, which are thought to help prevent many chronic diseases.

"Consumers should be reassured that avocados from different growing areas in California have a remarkable constancy of carotenoid content per gram of fat during the growing season," said Heber. "And, that they can get the most nutrients out of an avocado by peeling the fruit before slicing it in order to capture the maximum amount of carotenoids from the darker green flesh found directly under the skin."

The carotenoids that were uniquely characterized in California Hass Avocados through this study include trans neoxanthin, neochrome, lutein-5, 6-epoxide and chrysanthemaxanthin. The scientists also confirmed the presence of lutein, zeaxanthin, b-cryptoxanthin, a-carotene and b-carotene.

The researchers noted that California Hass Avocados grown in different regions of California have a similar phytochemical profile. However, there are increases in both total fat and carotenoids in fruit harvested later in the season.

The California Avocado Society held its Annual Meeting On October 16 & 17, 2009. On Friday the 16th, there were field demonstrations of higher density plantings led by Paul Romero of Calavo, a fall application of NAA by David Holden and avocado nursery propagation at Brokaw Nursery with Shelley Berg. A cocktail reception was held on Friday evening.

On Saturday the 17th, Kay Mercer, Central Coast Water Coalition spoke on Water Quality Regulation and Trends. SGT. Tim Waite, Ventura County Sheriff’s Department spoke about the Latest Surveillance Technology currently in service in Ventura as well as other counties in California. He noted that these security cameras can be monitored from a home computer, Wi-Fi or cellular phone and activity can be recorded on a DVR.

The Oliver Atkins Award was given to grower Jim Lloyd Butler for his many years’ of volunteering his groves for research, special plantings and tours. Butler’s family was in attendance and he acknowledged them for their support and their hands on involvement in the family business. After his presentation, Betty Bohrk, last years’ recipient who was not able to be in attendance last year, was given her award for her many years of service to the avocado industry during her time at CAC.

Jose-Luis Obregon, Managing Director for the Hass Avocado Board (HAB), spoke about International Avocados in the U.S. Market. Obregon shared the mission statements of each of the member organizations and APEAM. He showed the time frames of the year when each organization is targeting their promotions and which regions of the country they are targeting. He showed video clips of each of the organizations TV commercials and played the current HAB TV commercial that is airing on TBS during the baseball playoffs. Continued collaboration for a fall event for 2010 was also expressed. He spoke about HAB taking on the nutrition mantle since it benefits all member organizations. He showed the current crop forecast for Hass Avocados in the U.S. market and the need to continue to grow consumption.

Tom Bellamore, President of CAC spoke about Changes and Challenges. He spoke about the downsizing of the CAC staff and how 2/3 of the total CAC budget would be spent on marketing efforts which is the highest percentage of budget ever directed toward that purpose. Bellamore mentioned that CAC was hopeful of relocating its headquarters by 12/1/09 to further reduce overhead. Bellamore also spoke about Production Research being fully funded for the 2009-10 fiscal year. He spoke of his plan to provide for coordination of the research effort in the upcoming months.

Bellamore also spoke about social media and how CAC will be going where consumers are and how being part of social media will benefit CAC. He mentioned that there are currently 10 million users of Twitter, which was virtually non-existent earlier this year. He shared a personal story about Facebook and how it allowed him to connect with a former college roommate he had not been in contact with for almost 30 years. Bellamore emphasized the importance of rounding out CAC’s marketing program with the inclusion of Social Media in 2009-10.

CAS Award of Honor Presentation: It was an historic event with CAS awarding two Awards of Honor for the first time in its history. Derek Noble, CAS president, said they had to research the by-laws in awarding two awards of honor in the same year. He said the Board said both individuals deserved to be honored and the Board didn’t want to delay their recognition. James McCormac was honored for his years of service in providing the Newsline and his Editor skills for the Annual Yearbook that is provided to members every year. Rick Shade, the outgoing chairman of CAC, was honored for his two years of service as CAC Chairman and especially for his leadership in the past year when organizational changes at CAC and the CDFA Audit made it very challenging. Both McCormac and Shade said many people were behind them receiving their awards and they pointed out their spouses, both of whom were in attendance. McCormac also talked about all of his mentors in the avocado business. Shade thanked the CAC staff for their perseverance and professionalism during a very difficult time and stated that CAC has a bright future ahead.

Doug Koegeboehn, CAC Group Account Director DGWB Ad Agency, spoke about Consumer Trends. Koegeboehn spoke about the economy and how there has been a permanent shift in how people consume now and into the future. Excess is out and can actually have a social stigma attached to it. Dieting has changed from structured diets that deny ingredients and promote others to a well-balanced approach which will benefit avocado sales. He spoke about being able to deliver on the quality advantage that California Avocados have over imported avocados and how the growers need to do their part in ensuring that only high-quality fruit makes it to market. He shared with the group that being a farmer is in and consumers want to support U.S. produced and locally grown products. Consumers want to know who is growing their food and how. Farmers know the secret to producing abundant and flavorful fruits and vegetables. He talked about building on the “California” aspect of the grower campaign.

Dave Howald, Retail Marketing Director for CAC, spoke about Retail Trends in the U.S. Avocado Market, and what is next. He showed sales trends for the avocado category and how it continues to grow despite the economy. He spoke about produce traceability stating some handlers have adopted the new technology and that at some point in the near future all handlers will have to be using it if they want to sell to retail. He spoke about Country of Origin Labeling (COOL) and how California Avocados are being identified at retail. Howald also presented many examples of how CAC takes this information and creates retail promotions and programs to sell more California Avocados. He also showed examples of CAC retail training and information resources. He showed how retailers sell $70 million more avocados during the California season and how consumers continue to demonstrate a willingness to pay more for consistent quality.

A total of 20 California Avocado Growers’ stories have been highlighted in CAC’s 2009 California Avocado Grower campaign with Hand Grown in California thematic. The campaign continued to put a face with the place on California Avocados while putting a strong call to action for consumers to “Insist on California Avocados.”

Different media were used to reach consumers throughout their day, as well as to spread the campaign messages to foodservice and retail audiences. The chart below shows the 20 participating growers and the various media in which they were featured:

Click here to view a larger version of the above chart.

The California Avocado Commission thanks all of the growers and family members of growers who took part or offered to participate in the campaign this year – without you, it wouldn’t have been possible!

The results are in for the 2009 Avocado Tracking Study. In this edition, we evaluate why California Avocados are considered premium.

The Avocado Tracking Study monitors consumer insights about avocado advertising in both core and new demand markets throughout the United States. The study, originally funded by CAC, has been conducted since 1994. It was recently expanded to two waves (one in the fall and one in the spring) and is now funded by the Hass Avocado Board (HAB). The study is designed to monitor awareness, purchase frequency, usage and information on consumer attitudes about avocado country of origin. The study has been conducted online for the last four years.

Ken Roberts, Cooper Roberts Research, Inc, San Francisco, California presented results from the Fall 2009 wave which surveyed 1,996 shoppers at CAC's October Board meeting.

Advertising is impacting the premium image of California Avocados. In ad markets, those aware of avocado advertising are more likely than those not aware of advertising to give California Avocados superior ratings.

The above image represents ad markets in Fall 2009

In comparison to previous years, respondents who are aware of avocado advertising are becoming more likely to associate California Avocados with these key attributes.

Within ad markets

"When it comes to premium quality, which avocados do you feel would be better?"

While 49 percent of consumers surveyed in ad markets report that California Avocados are better, only 25 percent say they're better in the remaining U.S.

As seen in the image above, the percentage of consumers within ad markets who say California Avocados are better has increased since spring 2008 and is at an all time high as of fall 2009.

Check back for the next edition of the tracking study, which will explore California Avocado Brand Awareness Rebounds, and the notion that advertising appears to be effective at reaching the desired target demographic.

Or, view the tracking study in its entirety now by clicking here (Adobe PDF Reader required).