Last month signaled the climax of nearly 10 months of radical change for our company. In February, we launched our new product: an infrared hive grading solution called Verifli.
This was not your typical product launch. We didn’t send out endless email blasts begging everyone and their mother to try our shiny new thing. We didn’t make a media push to reach millions of eyes. We didn’t slap any sexy branding around it.
In fact, we hardly made much noise at all. We kept our heads down. If you’ve only been following us publicly, you probably have no clue what our company even does anymore. Well, we’re writing this to catch our faithful followers up to speed.
Around last May, our team had a collective “Aha!” moment. In the months leading up to that lightbulb flash, we worked tirelessly trying to figure out how to scale our company, our technology and obviously, our bottom line. We landed on almond pollination.
Each February, three quarters of the nation’s beehives are shipped to California, where 80% of the world’s almond are grown. Over 2 million beehives congregate in California’s Central Valley to pollination roughly 1 million acres of almond trees. At an average fee of $200 per hive, beekeepers in the US gain a healthy influx of cash early in the season while their bees enjoy a head start to the year.
But there are a few key issues. Although bees don’t “hibernate” as we usually think of it, they close up shop for the winter—shutting down the queen’s egg laying, booting non-essential bees from the hive, conserving nutritional storage and clustering tightly to retain heat. Since many big-time bee operations are located in areas with harsh winters, most beehives are at their weakest point in the year around the start of almond pollination.
But the best pollination comes from hives that are in mid-season form, not fresh out of spring training. To compensate for this, growers reward the beekeepers who can build hives to mid-season form by paying top dollar for strong bees.
But this highlights another key issue: the only one way to verify that you’ve got strong bees is by cracking hives open and checking. If you rent thousands of hives, this process can take days, perhaps longer if the weather doesn’t cooperate (like this season). What’s worse, a strong hive can contain anywhere from 10 to 15 THOUSAND bees. There’s simply no way the human eye can distinguish an 11,000-bee colony from a 14,000-bee colony—but there’s a significant difference in terms of pollination output. At the end of the day, an inaccurate hive strength assessment means someone’s leaving money on the table.
Now, to break up the wall of text, here are some amazing photos from our first pollination season (photo credit: Deftly Creative):
We saw this disconnect between beekeepers who are doing everything they can to build strong hives and growers who are willing to pay whatever it costs to get them. We figured there had to be a better way to reconcile their interests and evoke transparency and understanding.
We decided to develop a product to help growers and beekeepers measure the strength of their bees faster and with greater accuracy and objectivity. Our product, Verifli, uses infrared image analysis to map out the heat signature given off by the bees. Using physics and data science paired with real-time weather information, we can deliver an accurate assessment of each beehive with a single infrared photo of the outside of a hive.
With Verifli, there’s no last-second panic when a beekeeper finds high winter losses in mid-January; he can check the bees throughout the winter and give a heads up to his grower if they need to rent extra hives. With Verifli, a grower can set up a true incentive program to reward his beekeeper for every high-strength hive, not just what they find in a 10% sample. With Verifli, a grower can know exactly which parts of the orchard have low-strength hives, so he can shuffle around pallets to maximize pollination.
Now that you see the rationale behind our decision to pivot, I want to tell you about how we came up with a plan to launch a product in under 10 months. Check back next week for part 2!
Long time no see, Bee Word readers! If you couldn’t tell from the radio silence on our end, we’ve been extraordinarily busy the past few months. To catch you up in one sentence: we’ve been wrapping up the finishing touches for Verifli, our new digital hive grading product, in preparation for launch next month.
I’ll start by wishing you a happy 2019! The stage is set for another year of record growth at The Bee Corp. We hope you tag along for an exciting ride! Onto the good stuff:
2019 almond pollination price per hive
It’s that scary time of year once again, folks. That’s right, it’s almond pollination season. The time when one question lingers on everyone’s mind: what will go wrong this year? Usually followed by this question: am I paying/charging a fair price for pollination?
We polled a handful of almond growers. Here’s what they're paying per hive:
Just for reference, we know that Joe Traynor is charging $240 this year. Rule of thumb: if you’re paying more than this and you’re not 100% certain that you’ve got the best bees on the planet, you’re doing something wrong.
Two things to keep in mind here. First, don’t take this information as gospel—this is only meant to be a useful reference. There’s a good chance our data is not representative of industry-wide data. So please don’t dial up your beekeeper or your grower and ask for a better rate because of what you read here.
Second (and most importantly), you get what you pay for when it comes to pollination. You might feel envious of your buddy down the street who’s only paying $150 per hive until it’s the 20th of February and he’s complaining that only a quarter of his bees have been placed. If you want to avoid a stressful pollination season, give your beekeeper an incentive to deliver excellent bees.
1. Average price per hive is almost $200.
That’s a big deal. As rates continue to climb above $200 and growers begin look for new places to trim expenses, we’ll start to see consequences.
Big growers will begin to rip out trees in favor of planting Independence, Shastas or an entirely different crop. Small growers will stop renting bees altogether and poach their neighbors’ bees by blasting their trees with attractants. Growers with middle-aged Nonpareil orchards will scramble to cut costs and explore alternatives to honeybee pollination.
2. Almond growers will rent more than 2 million hives for the first time ever.
This is also a big deal. The U.S. bee population—roughly 2.7 million hives—will not grow any time soon. I’m willing to bet it’ll be the same, if not lower, ten years from now. If you think you’re paying too much for pollination now, wait until almonds surpass 1.3 million bearing acres.
Something else is going on here that’s worth noting. As much as I hate to admit, beekeepers aren’t getting any younger. Here’s what I fear might happen in the next decade:
With these market forces in mind, it’s clear that the market for pollination will undergo a drastic facelift in the next decade. If one thing can be said about almond growers, they're a resilient and opportunistic bunch. Although the same can be said about beekeepers, their path forward is a bit more challenging. Almond growers own land in one of the most fertile regions on the planet. Beekeepers own wooden boxes filled with high-maintenance insects that aren’t very versatile in terms of economic production.
If the almond industry collapsed tomorrow, who would be hurt the most: almond growers or beekeepers? The answer should be crystal clear.
2019 is a big year for almond pollination. And not just because I want to bestow a false sense of grandeur to this blog post. This is the year we zoom past 1 million bearing acres and 2 million rented hives. In my opinion, the market for almond pollination is on the verge of a radical inflection point.
P.S. If you haven't done so yet, please check out the latest version of Almond Board's handy guide: Honeybee Best Management Practices.
Ah, fall. The leaves are changing, the weather’s getting chilly, and the bees are wrapping up their last few jobs before the winter.
Back in the office though, beekeepers and growers aren’t slowing down. Yep, it’s that lovely time of year when everyone starts to worry about almond pollination.
Pollination prep done right
For those of us who are sending bees to California for the first time, there are a lot of things to consider before loading the trucks. First, I strongly recommend you review Joe Traynor’s articles on almond pollination. Joe’s been brokering hives for decades, and he’s the best resource out there on the topic.
When it comes down to negotiating price, now is the best time to reach an agreement with your grower. Don’t wait until it’s time to cut a check to haggle on price.
If you agree to do an inspection, figure out who’s paying for it, who’s actually doing it (either a state inspector or a private company), and when you want it done (early season hive strength results will be different from late season).
Maximize value for your grower
Keep in mind that while almond pollination is a pivotal time of year for you, your grower has a different perspective. They don’t care so much about the details—they just want the job done right and done on time. These are the top items on your grower’s mind:
Communication is absolutely essential. You need to tell your grower ASAP if you’re concerned about meeting one or more of those above items. That said, you don’t want to burden your grower with issues that aren’t related to the above items. If your trucker falls through or you choose a different overwinter yard, these are problems you should resolve on your own.
Over-communication can cause growers to think you’re too high-maintenance to work with. The name of the game is long-term value. Your goal should be to show that you’re trustworthy and capable—this is how you secure contracts year over year.
On that note, you should plan to check in with your grower at least once a month to let them know how the bees are looking. Are you still on track to hit your quota? Do you still expect to hit the 8-frame average? Is there any reason they should worry about on-time delivery? Lining up more bees at the last second is a major headache, so help your grower out by giving them a clear idea of what to expect.
Almond pollination is not an easy job, otherwise it wouldn’t pay so well. The best way to avoid conflict is to set clear expectations and communicate well.
Finally, give your grower a few ways to get in touch. Repeatedly getting sent to voicemail is the fastest way to lose your contract next year.
We learned from conversations with growers and beekeepers that timing is crucial for almond pollination. Bees need to arrive in the orchards just in time to start pollinating the almond blooms. As soon as blooms have been stripped of pollen, the bees need to leave the orchards to find the next food source. Growers need to treat their trees, but sprays must wait until the bees are on their way out.
All this talk about timing begs the question: what's the rush? It's all about food.
What's on the menu?
California's Central Valley is a unique place. Consistent weather and reliable sunlight makes for an ideal agriculture climate. Wyatt describes it as America's true breadbasket.
The Central Valley produces an insane amount of food. More than half the country's fruits and vegetables are grown in this sun-kissed corridor. So why is this fertile oasis such a hostile ecosystem for bees?
Simply put, the food grown there is made to feed humans, not bees. Bees forage on plants that provide a steady source of pollen and nectar. Although almond blooms offer highly nutritious pollen for bees, there isn't much for bees to eat after pollination season.
Where can I find ____?
Worth the commute?
Worth the wait?
Another important consideration is bloom time. Almonds bloom very early in the season, ending weeks before other crops begin to bloom. Although plums, cherries and citrus blooms can overlap with almonds, those crops account for less than 2% of the cropland in the Central Valley. Alfalfa would be a good source of bee forage at 29% of the nearby cropland, but bloom doesn’t start until May.
We often get asked by outsiders, "why don't almond growers just manage their own hives?"
This was my roundabout way of illustrating one of the key reasons why not. It takes a lot of work to keep hives going through the year—even with an abundance of local forage sources. If a grower needs to send someone out every couple days to feed the bees, it's probably not worth the value of not needing to rent hives every February.
It’s been well established by researchers and experts that a stronger colony produces greater pollination value. Joe Traynor, a preeminent pioneer of pollination, estimated in 1999 that an 8-frame colony will send out 7 to 10 times more foragers than a 4-frame colony.
More recently, Randy Oliver’s analysis of data from Dr. Frank Eischen revealed that the marginal value of frame strength appears to be more linear—4-frame colonies provide half the value of 8-framers, and 1/3 the value of 12-framers. Still, Randy’s analysis indicates that growers are getting a bargain for strong hives and overpaying for weak hives.
After poring over these studies, I wondered whether we could estimate the marginal value of a single bee. That is, how much pollination value does each additional bee provide? Thanks to some number-crunching from our intern, Dalia, we came up with a reasonably solid estimate. Keep in mind, this back-of-the-napkin analysis doesn’t account for important factors like weather variability, management methods or other costs of production.
Calculating marginal value
These numbers are from the 2011 season, the most recent complete set of data available. You may recall that 2011 brought a record yield at 2,600lbs/acre statewide, despite notoriously poor weather during pollination season.
Fact: In 2011, about 1.5 million colonies traveled to California to pollinate 750,000 acres, producing nearly 2 billion pounds of almonds.
Fact: An 8-frame hive contains approximately 14,000 bees.
Fact: The market price for an 8-frame hive was about $150 in 2011.
Bottom line: In 2011, almond growers earned 19 times the value they paid for each bee. NINETEEN TIMES!! This number is insane. Imagine a manufacturer making a 94.7% margin on their cost of labor. That just doesn’t happen.
Apple, the most profitable company in the world, makes a gross margin of about 21%. Amazon runs a 1.7% margin. This comparison is Apples to oranges (see what I did there?), but it almost makes sense if you look at the beehive as an uber-efficient pollination factory.
Now, although this breakdown could be substantially more robust, I think it’s important to start looking at pollination through this lens of marginal value. If Randy Oliver’s findings are indeed correct and the value of each frame remains linear regardless of the total number of frames in a colony, then the debate over stocking rate and frame strength is moot.
The true value isn’t number of colonies per acre or average frame strength; what really matters is the total number of bees out foraging.