Preventing Nut Theft In The Californian Nut Industry

The Californian Nut Industry Supply Chain

Discuss about the Research and Adoption of Biotechnology Strategies.

This paper focuses on the case of continued disappearance of nuts millions of dollar worth of pistachios, walnuts, and almonds (Laurits, 2013). While the farmers should be earning from their hard invested capital, the Californian nut industry experiences major problem within its supply chain. Vigneron (2017) points out in the case that even as cops have tried to liaison with farmers and nut processes to protect the industry, they are still far from achieving complete security of entire supply chain industry.

A diagrammatic representation and written explanation of the Californian nut industry supply chain

The nut industry is made up of players that serve the role of ensuring that nuts are produced and processed to a value addition product. 

According to Figure 1 above, the California nut industry consists of different farmers that use their agricultural farms to plant pistachios, walnuts, and almonds. Some of the farmers comprise of Carriere Family Farms, Sacramento Valley walnut Growers LLC, Bates Nut Farm, Frazier Nut Farms Inc., and Bremner Farms (Vigneron, 2017). They distribute their nuts though commission agents, or village level middlemen. There are also other commission agents that operate as wholesalers in the supply chain. The two well-known boards include California Walnut Board and Almond Board of California. Traders/wholesalers process nuts and sell them to customers through retailers. For example, Bulk Barn Foods Limited is a key retailer that contracts logistic companies to transport finished products to customers.

Vigneron present a story that covers a syndicate involving criminals that exploit vulnerability in the supply chain. More specifically, he explains that Central Valley has continued to lose pistachios, walnuts, and almonds amounting to millions of dollars. The findings from the case show that stealing happens in every state of the supply chain beginning from the growers to retailers (Bartzas, Vamvuka & Komnitsas, 2017). Those participating in the black market forge documents and present them to farmers with false claims that they are from authentic companies. According to Vigneron, is that the thefts of walnut are not common when it comes to using false documents before harvesting time (Vigneron, 2017).

Vulnerability also takes place between wholesalers and retailers. Edmonson (2010) explain that a majority of well-informed computer gurus use digital devices to change information at the point of collection (Kolbusz, Hsieh & Mays, 2015). A majority of the people that do this pretend to be from freight companies. Failure from wholesalers and retailing companies to verify the authenticity of logistics companies and other carriers makes it easier for people to steal millions worth nuts. Crain walnut Shelling located at los Molison – California is a case on point that illustrates how thieves load nuts on their trucks without being recognized. Even though Crain’s logistics directors suspected that Hernandez was a fraudulent driver, he failed to verify his authenticity. Vigneron (2017) findings reveal that this is something that affects almost every wholesaler that contracts other logistics companies to load their nuts to retailers of warehouse.

The Challenges of Nut Theft in the Californian Nut Industry

California supply chain also has people that already understand how the system operates. This has led to them knowing specific points where they could exploit to benefit themselves. For instance, apart from involvement of other stakeholders such as Bob Zahreddine from Glendale Police Department involved in investigating crimes, they have failed to hold those found accountable. Even if they do, criminals have been bailed out.

Figure 2 above shows that the revenue from the nuts industry has continued to increase for the last 15 years. The highest contribution comes from expansion of fruits and nut crops. They have also continued to show string increase in prices. The table reveals that the total revenue collected from fruit and nut industry rose from $9.5 billion in 2000 to over $16 billion in 2011. Furthermore, the contribution rose in 2012 and 2013. Despite a slight decrease in 2013 and 201, California recorded the highest contribution in 2014. Most specifically, much of the contribution comes from almonds ($5.1 billion), walnuts ($1.4 billion), strawberries ($1.4 billion), pistachios ($1.3 billion), citrus ($1.2 billion), and table grapes ($990 million).

Table 1: the total cost of nut theft to the Californian nut industry

Year	2013	2013	2014	2015
Cost (in millions)	0.24	0.12	0.5	3.86

• A table numerically demonstrating the cost of nut theft to the Californian nut industry at specific points of the supply chain;

From farmers	Commission agents	Wholesalers
66 truck loads	630 cartons	400 cartons
$20 million	$2.7 million	$0.6 million
Total Savings	$23.22 million

Written solutions for preventing nut theft at each point of the supply chain

Companies that specialize in processing and selling of completed nuts to customers integrate third parties in their supply chains. The lack of resources makes them opt for outsourcing for logistic specialists to help in transportation of either raw nut from farmers to stores/processing facilities then to retailers. Companies do this to gain from retailer experience in terms of deliver, operation, and an agile coordination of all fleets. According to the case, it is apparent that criminals continue to collude with truck drivers to steal from nut companies.

The position offers the best opportunity to liaison with third-parties in terms of formulating policies as well as protocols of vetting carriers. Unlike what is already happening focusing on truck drivers ought to form the starting point to eliminating gaps and vulnerability in the entire supply chain. Store managers of companies dealing with nut, should conduct a clear check of al truck drivers (Meeks, 2016). The process should include scanning finger prints of anyone involved in the supply chain. The model of operation must allow the results from the fingerprint reflect from the system of buyers and logistic company.

Scanning should be conducted at all stages of picking and delivery. Furthermore, the fact that drivers have colluded with criminals to present fraudulent documents, companies should now come up with policies that require licensing and registering number plate of all ferrying trucks. The process will help lock out fraudulent drivers (Haroldsen, et al 2011). Consignment handlers should ensure that they verify any driver before accepting to load off consignments o designated locations.

Written Solutions for Preventing Nut Theft at Each Point of the Supply Chain

Both companies processing nuts and their logistics companies should start focusing on trucks/cargo. Rogers, et al (2017) explain in his paper that tucks carrying nuts go for long distances before delivering nuts. Even though advancement in technology has made companies to adopt GPS tracking system on their vehicles, they should not do this as an end it itself (Kolbusz, 2015). Technology departments in these companies should eliminate some departmental processes in order to start investing in GPS units on-board of trailers and tractors. Technology departments should also ensure that companies embed sensors in cargoes.

Melody and Robert (2010) explain that different sensors have varying strengths to indicate exact points of transporting trucks. The sensors should provide alerts within shot intervals. Hence, a truck tacking wrong route or long sop over along the way should be danger zone for immediate attention by the logistics companies as well as owners of nuts.

Companies should also go beyond depending on tracking of their cargoes to secure the already stolen nuts. Organized groups have people who already understand how the system works (Purtill, 2016). Of course, the same scenario could happen to any system that has strong security measures. In specific, logistic companies need to give more concerning on ways to recover stolen goods o any value. The installed technology trackers need to allow drivers, logistic companies, and nut owners to collaborate to secure consignments under transit. Garcia (2016) recommends that all stakeholders involved in the supply chain must agree on enforceable laws and liaison with local governments. The recommendation identifies the point of enforcement as processes and contacts in different areas that lie along the transit routes.

The cost savings to the Californian nut industry if recommendations are adopted

Table 2: cost saving

From farmers	Commission agents	Wholesalers
66 truck loads	630 cartons	400 cartons
$20 million	$2.7 million	$0.6 million
Total Savings	$23.22 million

Conclusion

The objective of this paper was to understand a number of aspects concerning California nut industry. The finding from an investigation report conducted by Vigneron (2017) shows the industry has continued to make positive contribution through revenue generation. However, must of the money is being lost through stealing on nuts worth millions of dollars. Theft cases continue to occur at all stages of supply chain because of available vulnerabilities in driver identification, technology by-passing, and weaknesses in laws to convict those found guilty (Vigneron, 2017). The paper recommends that all stakeholders need to focus on authentic identification of truck drivers, and investigation & recovery of stolen nuts. 

References

Bartzas, G, Vamvuka, D, & Komnitsas, K. (2017) Comparative life cycle assessment of pistachio, almond, and apple production. Information Processing in Agriculture, Vol. 4(3), pp. 188-198

Cooley, H., Donnelly, K, Phurisamban, R., Subramanian, M. (2015) Impacts of California’s ongoing Drought: agriculture [Online]. Available at https://pacinst.org/wp-content/uploads/2015/08/ImpactsOnCaliforniaDrought-Ag.pdf. Accessed on 20 April 2018

Edmonson, R. G. (2010) Cargo security comes under scrutiny. Journal of Commerce (1542-3867), 11(44), 10-13.

Garcia, D. (2016) Nuts, by the truckload, make appetizing targets for thieves. [Online] from https://edition.cnn.com/2016/07/31/us/nut-thefts-california/index.html. Accessed on 02 April 2, 2018

Haroldsen. V., Paulino G, Chi-ham C, Bennett A. (2012) Research and adoption of biotechnology strategies could improve California fruit and nut crops. California Agriculture 66(2):62-69

Kolbusz, R. (2015) Combating cargo theft. [Online] from https://www.sdcexec.com/risk-compliance/article/12139750/combatting-cargo-theft. Accessed on 02 April 2, 2018

Kolbusz, R., Hsieh, D., & Mays, W. (2015). Cargo Safety & Security. Food Logistics, (171), 24-27.

Laurits, M. (2013) Supply Chain Security: Cargo Container and Federal Information Technology Procurement Risks. New York: Nova Science Publishers, Inc.

Meeks, M. (2016) Three ways to keep cargo theft in check. [Online] from https://www.scmr.com/article/three_ways_to_keep_cargo_theft_in_check. Accessed on 02 April 2, 2018

Melody, K., & Robert, C. (2010) detecting cargoes with potential security fraud — the application of self-organizing map networks. Proceedings for the Northeast Region Decision Sciences Institute (NEDSI), 255-258.

Purtill, C. (2016). A $10 million nut heist is a window into the shady, lucrative world of large-scale food theft.  [Online] from https://qz.com/663152/a-10-million-nut-heist-is-a-window-into-the-shady-lucrative-world-of-large-scale-food-theft/. Accessed on 02 April 2, 2018

Rogers, T. W., Jaccard, N., Morton, E. J., & Griffin, L. D. (2017) Automated X-ray image analysis for cargo security: Critical review and future promise. Journal of X-Ray Science & Technology, 25(1), 33-56.

Vigneron, P. (2017) The Curious Case of the Disappearing Nuts [online]. Available at https://www.outsideonline.com/2186526/nut-job. Accessed on 20 April 2018