The world's largest almond marketer and processor, Sacramento-based Blue Diamond has notched up a 16% compound annual growth rate (CAGR) over the past three years.
Sales for the year ended August 2013 jumped almost 19% to $1.2bn, and are on course to reach $1.5bn in the year to August 2014, president and CEO Mark Jansen told FoodNavigator-USA.
While all parts of the business (branded retail, value-added ingredients, and commodity nuts/ingredients) are doing well, products such as Almond Breeze - which is still generating staggering 40-50% sales growth year-on-year despite its relative maturity - have helped the branded retail segment grow three-fold over the past five years, said Jansen.
“Branded retail now represents nearly $500m of our annual sales.”
On the ingredients side, meanwhile, he said: “The focus of our ingredient business has been to maintain segment leadership and grow the value-added manufactured (VAM) segment. VAM now represents approximately 25% of our annual sales, more than doubling since 2010, a 26% compound annual growth rate.”
The rise and rise of Almond Breeze
Speaking about Almond Breeze, senior marketing manager Suzanne Hagener said it was hard to think of another brand that has been on the market for 15 years and is still generating double-digit sales growth.
She added: "It just hit the mainstream. We've got some people switching from soy and obviously people that are avoiding dairy because they are allergic to milk or lactose intolerant, but a lot of the growth is coming from people living a healthy lifestyle.
"So they might have Almond Breeze in the refrigerator along with skim milk. It's lower in calories than dairy or soy and has no saturated fat or cholesterol. It's also a great flavor carrier, so works really well with everything from coconut and chocolate to honey and vanilla."
Greek yogurt pairs well with almonds
Blue Diamond, which recently opened a monster almond processing facility in Turlock, California, is almost at capacity for phase one of the plant and expects to enter the planning process for phase two shortly, said Bill Morecraft, general manager of the firm’s global ingredients division.
The California almond crop has been growing steadily for 40 years, but things have really taken off in the past 10 years with the crop doubling in size from around 1bn pounds to an estimated 2bn pounds in 2013 (well ahead of USDA’s forecast of 1.85bn).
Several factors have contributed to growing demand, including the growth of the dairy alternatives market, and wider use in everything from snacks and yogurts to ready to eat cereals, he said.
“Greek Yogurt is a good example. Greek Yogurt as a category has experienced exponential growth. Consumers are eating yogurt at various times of the day, whether it’s for breakfast, a mid-day snack or a meal replacement. As a blend in, almonds’ nutritional value combined with their desirable texture and crunch make for a perfect pairing with Greek Yogurt.
“They also contribute to satiety, which is important to consumers looking for something to keep them feeling full and satisfied throughout a busy day."
Sea salt flavored almonds work well with dark chocolate
He added: “We are also seeing the expansion of new almond flavors in snack mixes and bars, including nutritional bars marketed with a healthy halo.
“Additionally, we see strong interest from the confectionery category for flavored almonds to complete chocolate products. Using sea salt flavored almonds to complement dark chocolate is one way to offer up a unique mix of complementary flavors and textures.”
Almonds are the #1 nut in new snack product launches in North America
According to the Almond Board of California, almonds - which have a hefty 6g of protein and 4g fiber per ounce - are the number one nut in new snack launches in North America, and are the nuts most frequently consumed as a snack, where they are commonly paired with apples, bananas, chocolate, salad and granola bars.
Results from a 2013 consumer study by Sterling-Rice Group suggest they are also the number one nut that consumers associate with being nutritious, heart healthy and good for weight management, said the Almond Board.
Some of this feel-good factor has probably been fuelled by studies highlighting how almonds can stave off hunger pangs, but almonds have also benefited from positive PR in the wake of research suggesting we may be overstating their calorie content (when you bite almonds and break them up into smaller pieces, some pass through the digestive system intact, taking the energy contained in them with them).
While this phenomenon likely applies to all nuts, the disparity between the actual and stated calorie content appears to be highest with almonds (up to 20% difference), according to researchers.
Demand will likely be constrained by supply in the coming years
According to the Almond Board of California, it’s still too early to talk about the size and quality of the 2014 almond crop, with the first official data expected in May when the National Agricultural Statistics Service (NASS) will provide an estimate.
But while the California almond crop has quadrupled in the past 30 years, “demand will likely be constrained by supply in the coming years”, predicted a spokesperson.
“Water is the biggest challenge for us and others who grow food in California.”
Click HERE to read more about the drought in California and its potential impact on almond prices.