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Background Information

Discuss about the Strategic circumstances and effects of nut theft in state of California USA.

California State is believed to be the highest nut supplier in the USA. Due to the weather condition in California, nuts have been found to be doing perfectly well (Dreher, 2012). California nuts include the almond nuts, walnuts, peanuts, cashews, pecans, etc. California nuts industry have been a big economic contributor towards its growth by pumping billions of money into the economy (MacDonald et al, 2013). The industry had been doing well until 2009 when the first nut theft was reported. Too much problems have been resulted to by burglary and theft in the processing and producing companies in the different parts of the world (Mawby, 2014). Burglary is not just a problem experienced by the California nuts companies alone, but is also suffered by businesses in other sectors irrespective of their sizes (Wolfe and Pyrooz, 2014). The only reported difference is the caused effect which depends on the value of the stolen property (Tilley et al, 2015). Burglars carryout research on the weaknesses of technology used by the companies and devise means of breaking into the company systems resulting to loses to the companies (Ienca and Haselager, 2016).

Theft of California nuts stated way back in 2009 when the first theft crime was reported. The problem seemed to be a coincident by then since it had not been reported before and as a result, no much attention was given to it and thus no serious security measures put in place to prohibit the occurrence of such crimes in future. In the year 2012, the nut theft problem increased and since then, a wholesome of over 10 million dollars have been lost by California nut industry. Major losses were incurred when drivers used fraudulent papers that looked original (Barclay, 2016). Fighting California nut theft has become difficult because crimes do not involve violence in most of the instances or cases reported but through paper forgery. Such cases were regarded as misdemeanor offenses but not a felony offenses as reported by the crimes department (White et al, 2012). However, in response to that, Boudreaux gave his view that the case should be different in world of agriculture where all crimes he proposed be considered felonies.


Several thousands of pounds of California nuts worth millions of dollars had been stolen from the industry. The complicated chain that connects the farms and the retailers had been used as a leeway by thieves to have made away with approximately 10 million dollars of nuts, this came as a shocker to the law enforcers and the farmers (Medellín-Azuara et al, 2016). The rise in the theft of California nuts was as a result of the replacement of electronics by food and beverages in the highly stolen goods in the United States. The prices of nuts are high and expensive and this make thieves to focus on fewer burglary of bigger values (Williams and Roth, 2011). Technology has as well provided some loopholes for thieves who steal from California nut industry as thieves use advanced technology to have access to legitimate transportation documents. Spread of black markets is also another issue of concern that encouraged California nut theft.

Quantitative Analysis of the Case

 

Figure 1: Supply chain for California nut industry

From the above chain; figure1, preparations of nuts starts directly from the farm where thousands of hectares (i.e. about 40,000 h) are set aside for nut farming activities. Upon their readiness in the farm for harvest, they are harvested and loaded in the shipping trucks where nuts are taken to the companies for processing. Transportation sector is important when it comes to getting raw materials from their locations to the companies for use in the production of other useful products (Monczka et al., 2015). Nuts upon reaching the processing companies, they are taken into the processing procedures where then finished products are resulted into. Various processing stages are followed to the latter till the intended products are obtained. The processing outputs are packed into different packages depending on the market requirement (Johnson, 2014). The cost incurred on shipment depends on the destination of the products where in this case local shipment might be less expensive than international shipment (Berthou and Fontagné, 2013).

Most of the losses suffered by California nut industry as a result of theft were at the time of shipment. The department of transportation database reported that the industry lose about over $500, 000 per load of the processed products by the companies. Thieves get their ways to the California nut companies by forging trucking company details and go away with the goods. As a result, many companies had fallen victims of the circumstance of nut theft and lose huge loads of products as thieves used legitimate shipment documents, this was reported by Horizon Nut Company and Setton Farms. Not limited to those two companies, other companies such as Hughson Nut Company, Almond processors, Walnut processors and many others had reported similar incidents in the past few years.

Reports given by Butte County Sherriff’s Department officer, Matt Calkins, stated that high value of loads are taken in the radar of the thieves and they then process legitimate shipment documents through dubious means making them appear as if from transportation industry and making away with goods. Thieves had access to these legitimate transportation documents from the internet. Chief executive officer of Transit Risk Management in Long Beach Calif, Sam Wadhwani reported that burglary are high in some specific days of the week i.e. before and immediately after the weekends then drive away with the goods. Thousands of pounds of stolen California nut products are transported to the international markets where they are sold. Security was agreed to be hiked where the number of roadblocks was proposed to be increased to offer more check points of the nut truckloads.

Solutions to the Problem

Table 1: Value in US dollars of California nut industry

Year of production

Amount in $ Billion

Percentage (%) Growth

2006

5.9

2007

7.2

23.7

2008

7.1

(1.6)

2009

6.1

(14.2)

2010

7.2

18.2

(Source: market line)

Attention started to focus on California nut industry many years ago, but from the table above, it recorded from the year 2006 where California nut industry contributed 5.9 billion dollars to the economy of the USA. Marking that as the initial value, 2007 recorded 7.2 billion dollars which in relation to the previous year was a positive growth of 23.7% in the industry’s contribution to the economy. In 2008, the amount the industry contributed to the economy reduced to 7.1 billion dollars which was a negative growth of the industry by 1.6%. Further negative growth of 14.2% in the industry was recorded in 2009 when the industry only pumped 6.1 million dollars in the economy. The industry again picked up in 2010 when it contributed 7.2 billion dollars which was equivalent to 18.2% growth of the industry.

Table 2: California nut industry theft

Year of theft

Theft in $ million

2012-2014

3.0

2015

4.6

2016

1.2

(Source: market line)

In between 2012 and 2014, the California industry lost 3.0 million dollar to thieves, in 2015, the theft grew to 4.6 million dollars and recently in 2016 the recorded California industry nut theft was 1.2 million dollars. These values tend to explain why the industry is recording decline in growth in some years.

Table 3: California supply chain and stages of theft

Stages of supply chain

Amount lost in ($ million)

Farm to processing

<1

Processing to market

7.6

(From: market line)

It is evident from table 3 that most of California nut theft occurred between the processing companies and the market during shipment resulting to loss of 7.6 million dollars and from the farm to processing companies losing approximately less than 1 million dollars.

Solutions that have been identified are taking records of the truck drivers’ licenses and also using fingerprint scanners to record their images and their true identities. Furthermore, drivers are supposed to be subjected into thorough questioning of the destinations of truckloads. Employing these by the nut companies in California nut industry will help reduce the recurrence of theft activities in the industry. When nut are still in the farm, since theft of nuts starts from the farm, CCTV cameras are supposed to be installed in the farms to help monitor the farms. Employing this idea will help security officers in monitoring nut farms and keeping them theft free. Also, number of roadblocks are supposed to be increased to increase nut truckloads checkpoints. Law makers are supposed to make tight agricultural laws to provide harsh punishment to thieves caught. Trackable serial tags are supposed to be introduced in nut products to make tracking easy should thieves drive away with them in the truckloads.

Findings from this report discovered that huge loss have been experienced and suffered by California nut industry. California nut are at risk of theft at all stages right from the farm all through to the final market resulting to loss of over 7.6 million dollars. The spread of black markets locally and internationally was one of the factors that had kept burglary alive in the recent past. A number of strategic plans were brought forth were as discussed above.

Conclusion

In conclusion, great loss had been suffered by California nut industry, being that the industry contributes to the US economy, the entire country’s economy is hurt. The highest percentage of California nut companies have suffered losses from theft. Major loopholes that have been identified in this report need to be prioritized.

References

Barclay, E., 2016. Farm victimisation. The Routledge international handbook of rural criminology, p.107.

Berthou, A. and Fontagné, L., 2013. How do multiproduct exporters react to a change in trade costs?. The Scandinavian Journal of Economics, 115(2), pp.326-353.

Dreher, M.L., 2012. Pistachio nuts: composition and potential health benefits. Nutrition reviews, 70(4), pp.234-240.

Ienca, M. and Haselager, P., 2016. Hacking the brain: brain–computer interfacing technology and the ethics of neurosecurity. Ethics and Information Technology, 18(2), pp.117-129.

Johnson, R., 2014. The US trade situation for fruit and vegetable products. Congressional Research Service, pp.1-20.

MacDonald, J.M., Korb, P. and Hoppe, R.A., 2013. Farm size and the organization of US crop farming.

Mawby, R.I., 2014. Commercial burglary. In The Handbook of Security (pp. 279-301). Palgrave Macmillan, London.

Medellín-Azuara, J., MacEwan, D., Howitt, R.E., Sumner, D.A., Lund, J.R., Scheer, J., Gailey, R., Hart, Q., Alexander, N.D., Arnold, B. and Kwon, A., 2016. Economic analysis of the 2016 california drought on agriculture.

Monczka, R.M., Handfield, R.B., Giunipero, L.C. and Patterson, J.L., 2015. Purchasing and supply chain management. Cengage Learning.

Tilley, N., Thompson, R., Farrell, G., Grove, L. and Tseloni, A., 2015. Do burglar alarms increase burglary risk? A counter-intuitive finding and possible explanations. Crime Prevention and Community Safety, 17(1), pp.1-19.

White, R.D., Haines, F. and Asquith, N.L., 2012. Crime and criminology.

Williams, C. and Roth, M.P., 2011. The importation and re-exportation of organized crime: explaining the rise and fall of the Jamaican posses in the United States. Trends in Organized Crime, 14(4), pp.298-313.

Wolfe, S.E. and Pyrooz, D.C., 2014. Rolling back prices and raising crime rates? The Walmart effect on crime in the United States. British Journal of Criminology, 54(2), pp.199-221.

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