DECEMBER 2019
SPECIAL ISSUE NEWSLETTER CALIFORNIA WALNUT BOARD PURSUING CREDIT-BACK AUTHORITY. Over the past year, discussions centering on our forecasted
of the Board, the Marketing
increase in production have culminated in the industry’s
Order Revision Committee
strategic plan to develop new opportunities to increase
(MORC) convened on
demand and stabilize future market returns. The planning
several occasions to
discussions focused on exploring any/all tools to support our
develop, review and
future growth including a possible change to the marketing
discuss the program
order to add credit-back authority. The authority would
structure. The MORC
encourage handers to build upon the California Walnut
presented its proposal to the Board
Board’s (CWB) activities, providing additional visibility,
at its annual fall meeting. An overview
awareness and sales for walnuts, through crediting a
of the program is included below.
portion of the handler promotional expenses against
The full board voted unanimously to move forward with
handler assessments due under the program.
a formal request to USDA. The request is currently under
The California Walnut Federal Marketing Order, established
USDA review. The process will include a formal hearing
in 1946, provides authority for a set of activities including:
which is expected to take place February 11, 2020. Following
research, promotion, and regulating quality and volume
the hearing, USDA will make a recommended decision
control. However it does not currently include authority
which recaps the testimony, followed by a 30 day comment
for handler credit for market promotion (credit-back). This
period. Once the comment period closes, USDA considers
authority, if approved, would allow handlers to receive a
the testimony, comments, and other available public
credit (rebate) for eligible market promotion activities of
information and may then issue a secretary’s decision and
seventy cents for every dollar in spend, up to a cap of
referendum order. The referendum order requires USDA to
available dollars based on prior year crop acquisitions. The
put the proposal to a vote of the growers, where you will be
purpose of the program is to encourage handler marketing
asked to vote on changing the language in the order to add
activities to promote the sale, use and consumption of
credit back authority. If the growers favor the amendment,
walnuts, in addition to the ongoing work of the CWB. Similar
the marketing order would be amended to include both the
programs have been successfully used in the almond and
authority to offer credit-back and the terms of the program -
prune industries.
whether or not the industry chooses to implement them. The
At the 2019 spring Board meeting, CWB staff presented a
expected timeline for voting is late spring/early summer.
framework for the potential program, and at the direction
WHAT IS CREDIT-BACK AUTHORITY? • Credit-back is an authority that several agricultural commodities (almonds, prunes, etc.) use to allow handlers to conduct eligible marketing activities in return for a partial credit/rebate on assessments. • The CWB does not currently have this authority in the marketing order, therefore, formal rulemaking has been undertaken to add the authority to the order.
OBJECTIVE/PURPOSE OF THE PROGRAM • Objective of the program – Effectively promote the sale, use and consumption of California walnuts. • Purpose – to encourage handler market promotion in addition to the CWB’s generic marketing efforts.
STRUCTURE/MECHANICS • The credit back authority, once approved, will be in the Order, whether industry chooses to use or not. CO N T IN U E D
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PA G E
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