April 24, 2014

Agribusiness

Seald Sweet Successfully Goes Global

Florida's most traditional citrus co-op is aided by an unlikely CEO.

Cynthia Barnett | 2/1/2010
South African packinghouse
Deals with growers in other countries
allow Florida citrus growers to meet demand year-round. Seald Sweet ships fruit from a South African packinghouse. [Photo: Seald Sweet]

At Seald Sweet, Sotomayor-Kirk’s learning curve began with the product. She knew import-export, but not citrus. She also had to navigate a cultural climate that she describes as more foreign to her than those she’d encountered in Honduras and Costa Rica. Initially, she found Florida’s citrus community insular and distrustful; she suspects it was some combination of her gender, her Hispanic heritage and having not been born to the industry. “Citrus was more good ol’ boy than any sector of the produce industry I had encountered in any part of the world,” she says. “It was just different.”

Sotomayor-Kirk’s ability to bridge cultural gaps served her well. She took the time to listen to Seald Sweet’s growers and answer their concerns about importing citrus. Why should companies like Hunt Bros. and Ben Hill Griffin Inc., then the largest owners, partner with growers they considered competitors and — well — foreign?

Doug Bournique, executive director of the Indian River Citrus League, which represents several of Seald Sweet’s growers, says it was a matter of survival: “When Kroger calls, you need to be able to give them the citrus they want 24/7, 365 or next time Kroger’s not going to call.”

Going Global

Seald Sweet’s primary competitor, DNE World Fruit Sales of Fort Pierce, also has reached out globally to maintain its dominance in the fresh-fruit marketing business, first to Australia, where DNE began importing navels in 1992. The company went on to bring in honeybells, tangerines, lemons and Clementines from Australia, and in 2001 began to import its first shipments from South Africa. DNE, which continues to own Florida groves, such as the giant Fellsmere Farms, runs its import business out of New Jersey.

Another familiar Florida name, A. Duda & Sons, has eased out of the fresh-fruit growing business, although the company maintains its role as a fresh-fruit marketer. Over the past few years, Duda has sold about 3,000 acres in Indian River County and closed a packinghouse in LaBelle. The company recently sold its juice processing business to Peace River Citrus Products. But Duda has expanded its marketing presence in California and imports lemons from Mexico and Clementines from Chile.

Sotomayor-Kirk also built trust between Florida’s citrus growers and international growers, in part by taking several of Seald Sweet’s growers/board members to farms in South Africa and Uruguay.

Ultimately, the board agreed Seald Sweet should invest abroad in groves and export companies, such as Mouton Citrus of South Africa. In 2004, UniVeg acquired a majority of Seald Sweet shares. “They turned out to be visionaries,” Sotomayor-Kirk says of Seald Sweet’s Florida growers, who today own 20% of the increasingly valuable company. “They saw early that this was the future — the future was not just to protect your ground, but to open the door to new possibilities by giving your customers everything they want.”

International trade comes with its own issues, however. In 2007, federal law enforcement officials raided the offices of a number of citrus marketers, including Seald Sweet and DNE, its primary competitor, and seized records as part of an investigation into possible price fixing on South African citrus. Both DNE and Seald Sweet cooperated fully and told their suppliers they had done nothing wrong.

In November, the U.S. Department of Justice served subpoenas on leaders of the South African and Australian citrus industries at a convention in California, according to the Produce News, a trade publication. Seald Sweet, however, hasn’t heard anything additional from federal authorities since 2007, a company spokeswoman said in January: “We have cooperated fully with the DOJ’s requests and are confident they will confirm we operate under highly ethical business standards. We have provided them with all requested information and have heard nothing further to date.”

Another issue: Back in Florida, the increased focus on imported citrus is hurting some Florida farmers, says Tom Spreen, a professor of food and resource economics at the University of Florida. “She can sugar-coat it, but the fact of the matter is that it’s had a negative impact, particularly on Sunburst tangerines,” says Spreen.

Indeed, sales of early Florida tangerines have plummeted statewide with the popularity of Clementines, which roll onto the grocery shelves at just the same time. But Hunt says that for the Florida growers who import, internationalization has helped more than it has hurt. For example, when the devastating hurricanes of 2004 and 2005 slashed Florida’s citrus production, Seald Sweet was among the few companies that could meet demand and make a profit despite the dearth of Florida-produced fruit.

In 2007, Deprez named Sotomayor-Kirk CEO, crediting her with making Seald Sweet a globally integrated citrus operation. Having expanded the company’s transnational deals to include table grapes, apples and pears, she has since overseen the launch of a deciduous fruit division, adding blueberries, pineapples, cherries and other stone fruits to Seald Sweet’s lineup.

Seald Sweet
Seald Sweet grows Clementines in South Africa. [Photo: Seald Sweet]
The new division helped grow sales from $99 million in 2008 to $106 million in 2009. Sotomayor-Kirk has set a $130 million sales goal for 2010 and a $160 million for 2012, with the new revenue coming from new divisions such as ethnic commodities, which will focus on America’s growing Hispanic market. Deprez says now that Seald Sweet has established its international reach, the goal is to focus on expanding the U.S. market: “There is tremendous growth potential for us in the United States, and we’ve got the team and the product in place now to do it.”

Deprez and Sotomayor-Kirk both see a steady future for a Florida citrus business once hamstrung by old thinking. The state’s oranges and grapefruits will always be among the best in the world — even if limited by canker, greening diseases and other challenges.

And Sotomayor-Kirk, of course, has long since learned the difference between a navel and a Valencia. “Citrus is still our core,” she says, “and it always will be.”

Tags: Agriculture

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