CD Media spoke again with Larry George, CEO of Northwest Hazelnut company, to get an update on how the China-Trump trade negotiations were impacting his industry. His response was interesting and insightful.
"We are just one company in the Oregon hazelnut market," said George. "People ask us routinely why we are the only Oregon hazelnut company fighting for our markets with Washington and China. The answer is that we have built a special relationship with our growers; we feel a responsibility. We are leading the fight, hiring lobbyists, going to DC, dealing with the Trump administration, and holding a dialogue with the Chinese. Our success comes from how we have built the company.
"Most people in food processing work off margin, buy cheap and try to sell high. We are different; we give our growers a guaranteed price, and from there, we share in any upside with 33 cents on the dollar. This gives our growers stability, and they have gotten huge bonuses over the years; our interests are aligned with theirs. We have confidence in our business model and now have 50% share in the US market of commercial hazelnuts. We've forced our competition to follow our model.
"So the answer to your question is -- we meet with USDA, USTR, members of Congress...our agreement with growers is that we fight for them as long as they bring volume.
"The tariff war has forced trade routes with middlemen to go away; we are now selling direct into China. This traffic has gone up significantly. We are shipping more hazelnuts than ever before. Even though tariffs have lowered prices to growers, we have cut out buyers and go through normal customs. This agreement will make our market expand significantly.
"We've already been through two seasons, without a trade agreement, and we are seeing Oregon hazelnut sales double in volume.
"We are building relationships in new ways, streamlining our supply chain; on the flip side, we are greatly diversifying our market, expanding markets into Europe, North America.
"The North American market is wide open; hazelnuts are a low carb, high protein food and we have a lot of room to grow.
"We want to use the trade dispute as momentum to open markets in China, and other places."
George is a great example of the ingenuity of the American farmer, innovating as Chinese could never do. Deal or no deal, it seems Oregon hazelnut growers will come out on top!
Subscribe to our evening newsletter to stay informed during these challenging times!!