2021 Nut & Agricultural Products Report

Travis Walvoord
Sunrise Commodities

While the pandemic brought a halt to many things in 2020, one thing that didn’t stop was the AFI arbitration process. Nobody likes to have or even think about trade disputes but they happen. Thankfully, they don’t happen often. But we’re fortunate to have a vehicle to resolve disputes in a faster and less-costly manner than court proceedings.

So, when the pandemic made in-person meetings impossible, AFI was able to do what we all had to with meetings and arrange for arbitration hearings to be held virtually. AFI took clear steps to ensure the continued integrity of the process. For example, all participants had to have their cameras on and be visible for the entire hearing. 

The end result: AFI was able to hold approximately the same number of hearings it has averaged over the past several years, giving members and the trade as the whole an efficient way to address disputes. 

The Nut & Ag Section is the sector within AFI that relies most on the association’s arbitration service. Through this service, contracts that contain the AFI arbitration clause can be settled via arbitration – at a much lower cost than court proceedings would take. The arbitration service has been an integral part of the association’s offerings for many decades.

Continuous efforts have been made to ensure the arbitration process is as fair and effective as possible for all parties. As an example, in 2016 AFI hired an arbitration expert to review the association’s arbitration rules. He concluded the rules had been written well but offered several suggestions to tighten procedures and further address issues raised by AFI staff and the AFI Arbitration Board. The board went even further, amending the rules to make it clear that foreign members are eligible to serve as arbitrators.

The latest version of the rules is available here. The site also contains valuable advice on how to prepare for an arbitration hearing and a checklist for filing a claim. 

Another important component of the arbitration program is the list of unsatisfied awards. That list is shared with other trade associations and with the trade in general. Other associations share similar lists with AFI. Members should be certain to alert AFI of any companies that should be added to the list. Buyers and sellers should refer to the list on a regular basis so they’re familiar with the names of the companies there. The association is continually looking for ways to enhance the ability of arbitration winners to collect their awards. The association's bylaws also contain a clause that failure to honor an arbitration award is grounds for a company to be expelled from the association.

AFI’s relationships with other trade associations is a key factor in its ability to represent us. The nut and dried fruit sectors include several associations with which AFI works closely, including the International Nut & Dried Fruit Council. With more and more regulatory issues and challenges coming up around the world, it’s likely AFI’s relationships with other trade associations will become even stronger as we continue to work with our partners, both on the supplier and customer sides, to keep our products moving with as little interruption as possible. 

I hope anyone reading this who is not a member of AFI will take another look. For the reasons outlined above and many more, the association is of great help to our sector. Member companies, of course, benefit even more because we have a say in actions taken by the association, as well as access to information provided by the association. One look no further than the Food Safety Modernization Act for an example of regulations the association helps us understand.

Foreign suppliers serious about the U.S. market should consider AFI membership a must as well. In addition to receiving ongoing information about U.S. regulations and trends in the U.S. market, AFI will serve for free as the U.S. agent with the Food and Drug Administration for all foreign companies that are members of the association. Many companies pay companies to act as their agent and hear from them only when it’s time for the next invoice. With AFI, members continually receive valuable information, while also having an agent ready to help as needed. On top of that, there’s the benefit to “being associated” with customers here in the U.S. In these times of great uncertainty, the advocacy and knowledge offered by AFI is an invaluable tool to navigate regulations and disputes. If you are not a part of this organization, I hope you will consider membership today.