Supporting the Promotion of Watermelon: Assessment Increase
About The Assessment Increase
Learn about the assessment, history and options for the future
Following the 2017-2021 Econometric Evaluation executed by Armada Corporate Intelligence, Inc., some Board and industry members started a discussion regarding the need for an assessment increase for the National Watermelon Promotion Board (NWPB/Board). President Christian Murillo and 1st Vice President Lee Wroten included Assessment Rate on the monthly agenda for the Executive Committee starting in April 2023 and presented The Case for the Assessment Increase at the September 2023 Board Meeting.
This webpage offers all you need to know on the potential assessment increase including more on the Board, the history of the assessment rate, inflation’s impact, justification of the increase, including the growth of watermelon volume and FOB, proposed assessment levels and how those funds would be spent to promote watermelon.
President Murillo and Vice President Wroten will continue to present this information at state and regional watermelon association conventions through March 2024. Following a town hall presentation at the National Watermelon Association Convention on February 23, 2024, NWPB Board members will make a final decision through a formal vote, based on industry feedback, at the Spring Board Meeting on February 24, 2024.
The National Watermelon Promotion Board (NWPB), based in Winter Springs, Florida, was established in 1989 as an agricultural promotion group to promote watermelon in the United States and in various markets abroad. Funded through a self-mandated industry assessment paid by more than 700 watermelon producers, handlers and importers, NWPB’s mission is to increase consumer demand for watermelon through promotion, research and education programs.
A serving of nutrient-dense watermelon provides an excellent source of vitamin C (25% DV), a source of vitamin B6 (8% DV), and a delicious way to stay hydrated (92% water) with only 80 calories per two-cup serving. Watermelon consumption per capita in the United States was nearly 15.5 pounds in 2022. Watermelon consumption in the U.S. was nearly 5.2 billion pounds in 2022. The U.S. exported an additional 328 million pounds of watermelon.
The Board has comprehensive communications, marketing, foodservice and research programs, all of which help increase demand for watermelon year-round. Here you can see a video highlighting results of the 2023/2024 fiscal year communications, marketing and foodservice programs. Research and industry support also help increase the demand of watermelon:
- Consumer Attitude and Usage Research
- Retail Research Including Scan Data and Ad Tracking
- Supply Chain Research Including the Weekly Watermelon Market Report. Custom reports are also available as a part of the Retail and Supply Chain Research
- Foodservice Research Including Menu Usage
- Health and Nutrition Research, which increases watermelon nutrition messaging in media
- Industry Support and Training including Crisis Communications and training like Communications and Queen Training
“Jennifer” exemplifies the Board’s target market. She is a 48-year-old, family-oriented female. Morals and values guide her decisions. Experiences are more important than things. She may be somewhat quiet, but she is an optimistic go-getter used to taking charge. Jennifer sees watermelon messages as she scrolls through social media and in a magazine in her doctor’s office. She sees watermelon being demoed in a recipe at her retail store, and she sees watermelon at her go-to lunch spot. What she doesn’t know and the industry might not know either is that so much of that watermelon placement starts with the work of the NWPB.
Between 2009-2018, there was a unique combination of revenue exceeding projections and some programs, while executed, were under budgeted amounts.
In 2018, the Executive Committee directed a drawdown of operating reserves to fund more robust activities in an increasingly competitive marketplace.
To achieve a balanced budget in 2025, the budget and programs will have to be reduced by $315,176 compared to 2023.
The goal is a balanced budget moving forward.
The Board will continue high-caliber programming to increase demand but programs have already started to scale back to levels needed for a balanced budget.
In addition to these costs and budget shifts, inflation has had a major impact on the Board’s buying power.
The dollar devaluation translates to lost buying power of roughly 30%. Specifically, looking at $3,024,721, the Board has the spending power of $2,104,601.
The Board is currently one of the lowest assessments as the percentage of unit value compared to other boards.
But ranks among the highest ROI when compared to the same Board’s five-year evaluations.
In the 34 years of the Board’s existence, the assessment rate has been increased one time in 2008. (Original assessment: 1989-2007; Current assessment: 2008-now)
Proposed increase figures for growers and shippers. Double the amount is paid by the importers.
Proposed increase figures for importers. Importers pay the full amount rather than split like growers and shippers.
- Industry awareness and input through:
- Presentations given at Association Conventions
- Ongoing NWPB Executive Committee Meetings
- Monthly NWPB Watermelon Update
- This webpage dedicated to information on the increase
- Industry mailer
- Town Hall at NWA Annual Convention
- Final NWPB decision at February Board Meeting
- If the Board votes to proceed:
- USDA Submission
- 60-Day Comment Period
- USDA Rulemaking
- Projected on January 1, 2025 the new assessment level would be collected
With an assessment rate of $0.0004 per pound for growers and shippers/$0.0008 for importers, NWPB budget in 2025 is estimated to be $4,493,784.
Option 1 allows for reinstating and complementing current programs.
With an assessment rate of $0.00045 per pound for growers and shippers/$0.0009 for importers, NWPB budget in 2025 is estimated to be $5,025,420.
Option 2 allows for cutting-edge marketing and communications programs to be implemented.
USDA would permit a tiered increase as an option, but it must happen over two consecutive years. Here is how that would work:
- New total assessment rate of 8 cents per hundredweight effective January 1, 2025 (Option 1 assessment rate)
- New total assessment rate of 9 cents per hundredweight effective January 1, 2026 (Implementing Option 2 assessment rate one year later)
Besides spreading out the increase over two years, this option could be done under one Rule. Any tiered increase over a longer timespan requires two separate Rulemaking processes (which have an associated cost to execute).