nov-dec-2020

In the spring, just as the unknown pandemic became real, at Turlock the significant engineering work was scheduled. With each major purchase of equipment, we arranged with the supplier to provide a team of engineers to lead the installation ensuring a smooth start-up. On March 12, the Spanish engineers from Incus had just begun working on the blancher. That night, the President announced that all travel with Europe would be shut down in two days. Not surprisingly, the following morning, instead of showing up to work, the Spanish engineers were at the airport. This cycle repeated itself with each piece of equipment, where needed engineers were prevented from traveling due to their company policy or international restrictions. What was amazing, is that even with these challenges, team members found ways to receive virtual instruction and largely on their own complete the startup. Thank you to our engineering and manufacturing teams for your Innovation and for Playing to Win. At last year’s presentation, many of you will recall panel members Mary Ann Henriques and Rebecca Hinojos. We learned of their leading roles in Salida’s safety journey. I am pleased to report that Salida recently completed its fifth consecutive year without a lost time injury — an incredible five million hours worth celebrating! The Salida management and HR teams found an innovative and special way to celebrate in the COVID-19 era, by using the parking lot! Employee safety is an act of integrity. Congratulations to Site Director Dennis Bettencourt and the entire Salida team for their Integrity. In a typical year, Blue Diamond sells almonds to over 90 countries. For the team selling raw almonds and almond ingredients, clearly nothing has been typical about 2020. First, after the Sacramento plant fire, we had to rebuild product supply and inventories, so we told the sales team to limit early sales. Second, due to trade wars, almonds out of Australia had a 50 percent price advantage into China which caused us to pivot toward India for growth. Third, the forecast and realization of perfect bloom weather created a significant market price correction. Fourth, COVID-19. While the U.S. response was not optimal, I assure you it was better than countries like India. They sent migrant port workers to their homes hundreds of miles away. Only to then reconsider that essential food imports still needed to flow through ports to replenish stores. Then government officials invited port workers back only after many had made the long journey home leaving ports undermanned when work resumed. It was chaos. Last year, it was the biggest threat to the almond industry. Did you know that it takes up to six weeks for almonds shipped out of the port of Oakland to clear the port in India ? When the ports closed, on the way to India were $30 million worth of Blue Diamond almonds. They were stuck in risky limbo. We were indeed fortunate that we sell directly into India. We have a full-time agent in the market and the most experienced sales team in the industry. And we are proud that we excel at creating long-term partnerships with the most reliable customers. After significant negotiation, not only did we successfully ship and receive payment for that $30 million worth of almonds, but by the end of the year we shipped and collected on another $30 million, growing annual sales to India by 40 percent! We appreciate our Global Ingredient Sales and Customer Service teams for demonstrating the values of Partnership, Integrity and Playing to Win. In this year of COVID-19, retailers were less interested in new products. They were rightly focused on the basics. Simplifying their business and keeping the most important, top-selling core items on the shelf. These included our Unsweetened Almond Breeze ® in grocery stores and Smokehouse ® Almonds at Costco. This did not stop innovation at Blue Diamond . Our product innovation teams were among the first to implement creative scheduling and protective barriers that allowed them to be fully productive. Moreover, this past year we created enhanced leadership and resources 7 N O V E M B E R – D E C E M B E R 2 0 2 0