July 26, 2016

Scarred melons find a variety of uses for California company

Dan Van Groningen never liked seeing so many watermelons go to waste at harvest time.

“The outside has cosmetic scarring, sunburn, stuff like that,” said the second-generation grower in Manteca, California. “We can’t ship them out to the chain stores.

“It doesn’t look good on the outside, but there’s nothing wrong with the inside.”
And that, in a nutshell, is how Van Groningen & Sons got into the watermelon juice and concentrate business.

Van Groningen farms about 5,000 acres, growing watermelons it markets under its Yosemite Fresh brand, as well as sweet corn, pumpkins, almonds, walnuts and various feed crops. It also has farmers in other regions growing watermelon, cantaloupes and other crops to lengthen their production season.

Dan estimates that between 15 and 20 percent of their watermelons end up being left in the field because they’re not marketable. While they were delivering a half-dozen truckloads of the unsellable watermelon to area food banks to mitigate the waste, a lot of product still remained behind. Rather than see so much go to waste, the family owned farm made a business decision about five years ago to go into processing.

“It’s just been mainly trial and error,” said Dan’s son and Sales Manager Ryan Van Groningen, 34. “It’s a pretty big learning curve from what our normal business was.

“A lot of companies would decide this is something they want to do, they hire the right people and go full force. We haven’t really taken that approach. It’s kind of been like a side thing over a few years, and as we gained more knowledge we’ve been building it up slowly.”

First came the experimentation. Dan, now 68, took charge of that – in fact, the processing end has been his baby from the start. In total, seven family members have an ownership stake in the company; several others work in the business.

The family leadership team includes, from left, Paul Hiemstra and then Bryan, Dan, Robert, John, Jason and Ryan Van Groningen.
The family leadership team includes, from left, Paul Hiemstra and then Bryan, Dan, Robert, John, Jason and Ryan Van Groningen.

They first started out producing watermelon juice using a third-party bottling company.

“We started to do some sales on it, but what we learned real quick is that shelf space in grocery stores is tough to get into, and not a lot of people want to deal with somebody who has just one item,” Dan said. “We learned real quick this wasn’t the approach.”

Instead, they decided that producing in bulk for customers who want to use it for processing was the way to go. That approach has proved to be the right formula.

“We are trying to produce this product as ingredients,” Dan said, “not really making the finished product, but selling it bulk as an ingredient so the next manufacturer can make the finished product.”

That meant developing variations of two products: juice and concentrate. The company now offers a frozen not-from- concentrate juice in 275-gallon totes and 6,000-gallon tankers. They also offer frozen watermelon juice concentrate in five-gallon pails and 50-gallon drums; it comes either without the pulp filtered out or in another variety where the pulp has been removed. Van Groningen also produces a watermelon puree that is slightly different from either the juice or concentrate.

Dan said they’re experimenting with making fresh-cut chunks. Some customers are looking for organic juice, so they’re doing a little bit with organic watermelon products.

They’re also testing with cantaloupes, honeydew, pomegranate and kiwi juices.

Watermelons that don't make the cut for fresh display add value as concentrates and juice. Photos: Van Groningen & Sons
Watermelons that don’t make the cut for fresh display add value as concentrates and juice. Photos: Van Groningen & Sons

Starting out using a third party for production, the family has built its own 25,000-square-foot processing facility in Manteca to do juicing in-house, and have added production and food safety staff. They still produce concentrate via a third party.

The company has also installed a 1-megawatt solar system at its cooling and packing facility. With various ranches on contiguous land, the power the system produces can be used for all of their facilities.

“Basically, all the power we’re producing at that one place, we can utilize at all locations,” Ryan said.

While it was a substantial investment, rebates from the state helped, as will savings in energy costs over time. Meanwhile, the processing business has been growing.

“So many health benefits have come out about watermelon, so a lot of different manufacturers are trying to incorporate it into different products, especially juices,” Ryan said. “It seems there is more and more interest in it.”

Most of Van Groningen’s customers are mixing watermelon juice with other ingredients to create a juice blend.

“I have customers that are using it in health drinks, like energy workout- type drinks,” said Van Groningen Sales Assistant Teri Lovdal. “They’re not high caffeine, but the healthy rehydrate workout-type of drinks.”

Jason Petrou tapped Van Groningen’s watermelon concentrate for a beverage he created called CEO (Clean Energy on Demand). CEO is a mix of Van Groningen’s watermelon juice, coconut water and organic caffeine from green coffee bean extract. They’re sold in 16.9-ounce bottles, mostly in the Northeast; Petrou is based near Boston, and takes delivery of Van Groningen’s frozen concentrate in a 50-gallon drum.

“Right now we’re focusing mostly in health clubs, gyms and specialty stores, but we’re starting to get into a little more mainstream grocery,” Petrou said. “People love the watermelon flavor from the Van Groningen product.”

Lovdal said customers are using Van Groningen’s watermelon juice or concentrate in a variety of other ways, too.

“I have a few breweries,” she said. “I sell to wineries. I have a customer using it in a yogurt-type product.

“Another area it goes into is teas. People are using it with some of the health-type of teas that are out there – the kombuchas – as an ingredient in their teas.”

She predicts opportunities in jams, jellies and baby food.

“I see growth in it,” she said. “To me, it’s limitless.”

And that’s what the Van Groningens have in mind. Their processing business has helped use up some of the crop that they can’t sell, but not enough.

“It’s a dent (in what’s left in the field), but it’s not big enough yet,” Ryan said. “We want to make a much bigger dent because we do grow on a pretty large scale and have a lot more production available.

“It’s a good business decision, but it’s also a sustainable thing. It doesn’t make sense to be producing all this product and wasting it. It’s great for us to help with hopefully being a little more profitable, but we also definitely never want to be wasteful. The land, the water, all these things in California are getting tougher and harder to do, so we want to utilize the crop as much as possible.”

— By Kathy Gibbons, contributing writer