Still a fine line between cranberry supply and demand, says Ocean Spray

08-Oct-2009 - Last updated on 09-Oct-2009 at 15:11 GMT

Supply and demand for its cranberry products continues to be a balancing act at Ocean Spray despite bringing extra acres on board, according to the company.

This time last year Ocean Spray, which produces sweetened dried cranberries, cranberry ingredients and juices, had just finished expansion of its Wisconsin Rapids plant, but said that if there was more fruit “there could be even more added expansion and jobs to this facility in the future”.

Although the US Department of Agriculture has predicted the nationwide cranberry harvest to be about ten percent down on last year, Ocean Spray says it has added more than 6,300 acres to its supply chain, capable of bringing in “roughly a million barrels of cranberries over the next five years or so,” according to the company’s director of cooperative development Arun Hiranandani.

He told FoodNavigator-USA.com: “About two and half years ago we started looking at our demand for the next two years and we felt that we needed more fruit to come into the co-op.”

The company claims to handle about five million of the roughly nine million barrels of cranberries harvested each year. (One barrel holds about a hundred pounds.) And as it takes about three years for plants to bear fruit, the company is constantly trying to look ahead to balance supply and demand.

Selling every pound

“We are currently producing one hundred million pounds of sweetened dried cranberries and we are on track to sell every pound,” said Hiranandani. “…What we are trying to do is make sure we are projecting demand growth as well as supply into the future.”

He added that other brands – those that are not based on a co-op framework – may not have the same kind of close connection between their supply network and demand from consumers.

Hiranandani added that Ocean Spray has not been strongly affected by the recession, hypothesizing that “middle tier brands” are more likely to feel the impact of consumers turning to private label goods.

“The demand for our branded products…has been continuously growing for the past four or five years, even during the recession, and we project it to continue growing,” he said.