Market Report

Mar 25

Although the markets continue to be extremely active and high overall, there is good news right around the corner on the West Coast of the U.S. Crops will be seasonally transitioning from the Yuma, AZ area to Salinas, CA area which will be a welcomed changed with increased production and quality on all lettuce items. This could be the last week of elevated prices for iceberg and romaine along with related crops. 

Below is a recap of what is going on, weather-wise, and the effect it is having on various crops.

YUMA, ARIZONA
Various growers are already starting the annual move from Yuma, AZ to Salinas, CA and, as noted above, this might be the last week of extremely elevated markets.  We are already seeing a healthy decline with romaine, even though iceberg is still very high.  Greenleaf, Red leaf, Spinach, and other leafy greens are back to more seasonal priced levels.

MEXICO
Mexico is still recovering from its hard freeze and crops, including squash, zucchini, eggplant, green beans, and lettuce, are still feeling the stress.  Hot peppers, tomatillos, and limes continue to be high as Mexico tries to recover from the damage.  Also, we will continue to see elevated prices on avocados and yellow squash.

FLORIDA
Florida is warming up!  Hopefully, the cold front that Georgia is experiencing this week doesn’t find the strength to make its way to South Florida.  Once again, the hardest hit crops were squash, eggplant, kale, and chili peppers.

Here is a recap of commodities that are significantly higher than normal:

• Tomatillos:   trending in the high $50s.
• Limes:   in the $40s for a 40lb case.
• Avocados:   Mexico's peaked avocado season from earlier during the past year has returned to normal and is expected to remain normal throughout the remainder of this season. This means about 20 percent less volume. California growers are still waiting for their avocados to increase in size and they are only harvesting limited quantities, about 3 percent of full volume. California growers will continue to increase volume as the month progresses, but normal volumes should not be expected until April.
• Iceberg Lettuce:  Abnormal cold temperatures and rain in Yuma and Mexico's growing regions have had a tremendous effect on the quality, weight and size of lettuce and romaine products. Much of it has been damaged beyond being usable. Some romaine has required 8-14 leaves with blistering and tip burn to be discarded causing weight and size reduction. All of these factors are initiating very high price increases.
• Kale:  Kale is very scarce and is very high priced.  South Carolina, Georgia, and Florida are suffering from the latest rounds of cold.
• Tipped green beans and French Beans: Prices have been on the rise for tipped green beans, French beans and chili peppers due to continued wind and rain in Mexico. Many plants were damaged earlier in the month. Suppliers continue to locate additional sources to meet current demand. Also, freezing temperatures in Florida and seasonal transitions have greatly diminished bean production.
• Eggs: Prices are currently much higher due to Easter demand.
• Cucumbers: Cucumber prices are up due to the combination of Florida and Mexico’s cold weather.
• Squash and Zucchini: Prices are still up on yellow squash but a few dollars lower than last week.  This is due to the weather conditions in Mexico and lack of pollination in Florida.
• Snow Peas and Sugar Snaps: Prices rising due to Guatemala’s recent cold snap.
• Corn:  Corn got hit hard two weeks ago in Florida due to the freeze.  Growers are telling everyone that there won’t be any fancy corn for up to 4 more weeks.  Hopefully that is being exaggerated but percentage corn is what we are looking to ship out of the U.S.  Mexico has corn also, but the price is higher than the U.S. so, for now, we are staying in Florida.
• Melons:  During the winter, honeydews and cantaloupes come from offshore sources.  Weather has driven the price up for these as well.
• Asparagus:  Asparagus is predominately being harvested out of Peru.  Prices are stable in the $20’s but will drop once the California crop begins to be harvested in a few weeks.

On a positive note...
If you are anxiously looking for lower prices, check the commodities below for the latest positive trends.

• Celery and Cauliflower – lower.
• Grapes (red & green) – lower.
• Romaine – trending lower.
• Romaine hearts – trending lower.
• Yellow Onions – trending lower.
• Green onions – back to stable prices.
• Blueberries & blackberries – excellent value.
• Potatoes – low priced all season and the trend continues.
• Citrus – excellent supply and prices.  Ask about Minneolas, Kumquats, and more.
• Strawberries – Florida berries are available but have hardly any shelf life.  We are pulling mostly from California with excellent size and flavor.
• Lemons – stable.
• Cabbage – stable.
• Carrots – stable.
• Broccoli and crowns – stable (low).
• Tomatoes – good value and quality.

URGENT MARKET UPDATE

Mar 15

It has been a long time since we have seen markets as active as they currently are, resulting in skyrocketing prices. This is unfortunate for all of us, but a reminder that Mother Nature is ultimately in control of the weather and crop production. Here is a recap of what is going on weather-wise and the effect it is having on various crops.

Yuma, Arizona
Every winter produce is harvested out of Yuma, Arizona through the end of March and then the crops transition back to Salinas, CA. In the last couple of years, the weather has cooperated and crops have been unaffected. That is far from the case this year as the following pattern developed and has played havoc on the crops.

• The season started with a bang and lettuce grew fast and was harvested early.
• Right after this the warm weather trend ended, it was met with cold weather and the crops could not catch up with demand, pushing prices much higher with marginal quality.
• Now, Yuma has hot weather and the season only has another two weeks to go. Growers just don't have ample supplies to cover demand. The result is a $40+ lettuce and romaine market with marginal quality. Supplies are so light that even processed lettuces have skyrocketed.

Mexico
Mexico is usually the buffer of the U.S. in the winter as they harvest many crops during this period including squash, zucchini, eggplant, green beans, and lettuce. However, due to their own continued cold weather and rain pattern, Mexico is forcing significant price increases on many commodities that include avocados, tomatillos and limes. This is an addition to the crops that were mentioned earlier in this paragraph.

Florida
Florida has also experienced cold weather that has affected squash, zucchini, eggplant, kale, peppers and tomatoes.

Here is a recap of commodities that are significantly higher than normal:

• Tomatillos: trending at $60+
• Limes: in the high $40s, low $50s
• Avocados: Mexico's peaked avocado season from earlier during the past year has returned to normal and is expected to remain normal throughout the remainder of this season. This means about 20 percent less volume. California growers are still waiting for their avocados to increase in size and they are only harvesting limited quantities, about 3 percent of full volume. California growers will continue to increase volume as the month progresses, but normal volumes should not be expected until April.
• Iceberg Lettuce & Romaine: Abnormal cold temperatures and rain in Yuma and Mexico's growing regions have had a tremendous effect on the quality, weight and size of lettuce and romaine products. Much of it has been damaged beyond being usable. Some romaine has required 8-14 leaves with blistering and tip burn to be discarded causing weight and size reduction. All of these factors are initiating very high price increases.
• Kale: Kale has also been affected by the cold weather.
• Tipped green beans and French Beans: Prices have been on the rise for tipped green beans, French beans and chili peppers due to continued wind and rain in Mexico. Many plants were damaged earlier in the month. Suppliers continue to locate additional sources to meet current demand. Also, freezing temperatures in Florida and seasonal transitions have greatly diminished bean production.
• Eggs: Price are currently higher due to Easter demand.
• Cucumbers: Cucumber prices are up due to the combination of Florida and Mexico's cold weather.
• Squash and Zucchini: Prices are up on squash and zucchini due to the weather conditions in Mexico and lack of pollination in Florida.
• Snow Peas and Sugar Snaps: Prices rising due to Mexico's cold weather.
• Corn: Corn got hit hard last week in Florida due to the freeze. Growers are telling everyone that there won't be any fancy corn for up to 6 weeks. Hopefully that is being exaggerated but percentage corn is what we are looking to ship out of the U.S. Mexico has corn also, but the price is higher than the U.S. We are going to pull some to check the quality.
• Melons: During the winter, honeydews and cantaloupes come from off shore. Weather has driven the price up for these as well.
• Asparagus: Asparagus is predominately being harvested out of Peru. Prices are stable but will drop once the California crop begins to be harvested.

On a positive note...
On the following items, pricing has remained normal or dropped. You might consider some of these as substitutes for products currently failing to meet demand: celery, grapes (red and white), Georgia Gourmet Lettuce, Green Leaf lettuce, hydro bibb lettuce, cauliflower, onions, potatoes, green onions, lemons, Minneola tangelos, oranges, spinach, broccoli, strawberries, blueberries, blackberries, cabbage, carrots, and lemons.

We should see prices drop in April but it doesn't look pretty until then.

We will continue to inform you of any new developments.

Seattle Tofu Company, Chu Minh Corp., Loses Food Processing License, Fined

Mar 12

Royal Food Service has not purchased or handled any of the product indicated in the communication below.

OLYMPIA — The Washington State Department of Agriculture (WSDA) has revoked the food processing license of Chu Minh Corp., which produces tofu and other soy products, after several inspections found on-going sanitation problems with the Seattle business.

In addition to revoking the company’s license to process food, WSDA also assessed a civil penalty of $17,800 against the company and required all product at the facility to be destroyed. Notices about the license revocation have been sent to all retail outlets and restaurants that have purchased or carry Chu Minh products.

As a result of these actions, the company cannot process any food at this location. Chu Minh has 10 days to appeal and request agency reconsideration of the order, but it cannot operate as a food processing operation during that appeal period.

This enforcement action follows several visits to Chu Minh where WSDA inspectors consistently found problems with unsanitary conditions, poor sanitation practices by employees, pest infestations and a general failure to protect food products from contamination.

During the most recent inspection on March 6, inspectors noted many of the same problems observed during earlier inspections.

Heavy Rain, High Temps Trigger Very Active Lettuce and Romaine Markets

Mar 11

Mother Nature has decided to throw growers another curve ball in Yuma, Arizona with heavy rain that will delay harvesting of all forecasted volumes.

Also, the temperature forecast for this week is 90 degrees by Wednesday. Due to these dramatic changes in climate, growers expect the quality of lettuce and romaine will be fair at best for the rest of the growing season.

These conditions have caused the lettuce and romaine markets to be extremely active again. Blister and peel in most lots are 8-14 leaves deep. Romaine weights are also light. Prices will remain active for the next two weeks, possibly longer, with romaine remaining somewhat higher than lettuce.

We will keep you updated on developments as they transpire.

Extreme Spike in California Hass Avocado Market from Inadequate Rain

Mar 08

The current Hass Avocado market has become highly volatile causing an extreme spike in prices. While there is plenty of fruit on the trees in California, it has not yet sized up due to lack of rain. The smaller sized fruit is delaying harvesting.

Mexico continues to be a supply source for the U.S., but Mexican growers are curtailing harvesting now that market prices are rising from where they were a few weeks ago. The industry is not getting enough supply to meet the demand. The market has jumped significantly in the past week.

There is a bright side, however. There are plenty of avocados on the trees and California growers are beginning to harvest. Sources believe that the price spike is temporary and that they should stabilize soon. The market should correct itself in about a week when adequate supplies return.

Thank you for your patience and understanding. We will update you on any new developments.

Freeze Damages Corn and Green Bean Crops in South Florida

Mar 07

Sweet corn has been damaged in south Florida due to freezing temperatures, estimated as much as one quarter of the crop. When temperatures dropped to the mid-20s on March 4th, green beans were also damaged.

Industry sources reported that the damage is mainly to sweet corn because there is so much of that crop in the growing area. They expect growers to replant some of the corn crop acreage, typically harvested in early April. Other sources indicated that it's too early to tell what the affects of the damage will be. They will need a few days to assess and meet with coop members.

While prices on green beans have been higher, sweet corn prices have not yet increased significantly.

We will keep you informed of any new developments.

Act of God Declared on Florida and Mexico Squash & Zucchini

Mar 05

Due to the lack of pollination in southern Florida, the squash and zucchini crops are coming up very light as seen by market price increases over the last week. Suppliers have been able to cover demand up to this point, however, they have indicated that they do not expect to have enough to cover them for at least the next two weeks. If the bees return soon, they can recover in Homestead, Florida. If not, they will remain short on supply until the end of March.

Normally at this time, Mexico can fill any East Coast shortages. But a freeze in Culiacan, Mexico last month kept squash from coming up, resulting in very light imports to help offset the east. Sources have indicated that Culiacan will not recover and they don't expect to see the squash market return until the Northern Mexico area of Sonora comes into play in late March.

For these reasons, an Act of God is being declared on all squash products. This is a very serious move for suppliers, and a last resort. It is called only when there are insufficient supplies to cover orders.

Thank you for your understanding and we will continue to update us weekly on this situation as it progresses.

Industry-wide Romaine & Iceberg Blistering

Feb 21

The quality on romaine and iceberg lettuces will continue to have blister with all suppliers. This is an industry wide issue.

Suppliers are quoting blister with 8-10 leaves and 2-3 leaves with brown blister. With cold weather and gusty winds expected to hit Yuma over the next three to four days, the quality will only worsen.

The problem of blister will be prevalent for the rest of the Yuma season. This issue will not go away with any miracle warming trend. The damage is real, and not fixable.

We will keep you informed of any new developments.

Update on Strawberry Shortage (Feb. 20)

Feb 20

It looks like the tight supply situation in California will continue for the next couple of weeks while Florida supplies could slowly improve by next week. The same trends of cold weather and rain continue to plague the California strawberry growing regions. This trend is expected to continue until the first weeks in March.

Strawberries out of Florida appear to be better positioned to produce as the temperatures are higher and the forecast shows clear skies.

Mexico strawberry growing areas have been getting warmer weather for the last two weeks which has also hurt the quality of the fruit, mainly bruising. Supplies peaked a couple of weeks ago and will wind down. Depending on weather, Mexican growers could finish up in the next two weeks.

We appreciate your cooperation and understanding during this time and we will inform you of any new developments.

Update on Strawberry Shortage (Feb. 20)

Feb 20

It looks like the tight supply situation in California will continue for the next couple of weeks while Florida supplies could slowly improve by next week. The same trends of cold weather and rain continue to plague the California strawberry growing regions. This trend is expected to continue until the first weeks in March.

Strawberries out of Florida appear to be better positioned to produce as the temperatures are higher and the forecast shows clear skies.

Mexico strawberry growing areas have been getting warmer weather for the last two weeks which has also hurt the quality of the fruit, mainly bruising. Supplies peaked a couple of weeks ago and will wind down. Depending on weather, Mexican growers could finish up in the next two weeks.

We appreciate your cooperation and understanding during this time and we will inform you of any new developments.