Looking for Ad Item

It is becoming increasingly more difficult to find fruit and vegetable items to run for ads. This problem can be attributed to one reason: FREIGHT. While many of the fob prices are reasonable, and often downright cheap, the freight cost per package continues to put them at a less-than-bargain price. For instance, you may have a lettuce price at $10.00/box fob, which isn’t bad, but then, for East Coast shipments, you have to put a freight cost of $8.00-9.00 per box, plus store markups, and your retail is anything but a bargain price. So, what are consumers doing? We assume they are buying bag salads, canned beans, and frozen broccoli. The GOOD news is that freight rates have peaked for the year. In fact, we are paying several hundred dollars less than we were 2 weeks ago. The BAD news is that diesel costs are still sky high, and even looking to go higher, so we probably won’t see rates come down a whole lot as we approach the Fall. We feel we will still be paying $1500-2000 a load more than “normal” as we get into the Fall.
Our 10 day weather forecast in Salinas shows more of a cooling trend, putting things back to normal after last weeks warming trend. San Joaquin Valley districts, where the fruits are coming from, continue normal, which put them at 100 degrees for highs.
Trucks available to all areas of the country at lower rates than 2 weeks ago, which were the peak for the year. Still, $7000-7500 to the East coast is the range.

LETTUCE–fairly light supplies in Salinas area, and shippers would like to see their markets go up for that reason. We don’t see business very brisk for lettuce, and that is keeping demand down and prices steady.

BROCCOLI–plenty of supplies on 14s, 18s, and crowns, and no change in the market, which is down. Quality is nice on all broccoli.

CAULIFLOWER–prices have been too high for the demand. Shippers are desperately trying to hold on to their markets, but we just don’t see it. Expect prices to slip on 12s and 9s as the week goes.

LEAF ITEMS–after the heat spell that knocked a lot of the supplies of red, green, romaine, and boston, things are getting back to normal. Local farms across the country are going strong, and demand out West is slowing down. As a result, the markets are starting to back off on all leaf items.

CELERY–this item continues to baffle us. With the high freight costs for a box of celery, we thought the fob prices would hit the floor. Not so. Prices are still up there, keeping the prices upwards of $30 for a box of celery on the East Coast. We probably won’t see lower prices until Michigan starts.

STRAWBERRIES–demand has really backed off for strawberries. Even Driscoll is looking for business! We don’t know if their salespeople even know HOW to sell! They have just been taking orders and prorating for the past year, it seems. Our weather looks to be cooler for the next 10 days, so the mention of Driscoll LOOKING for business could be short lived.

Freight Rates Continue to Climb

Never before have we seen such a significant increase in fuel costs, and the entire economy is affected.  From pencils to peppers, everything needs to be transported by truck, causing retail prices to explode.  Produce prices are greatly affected by this economical disaster, with freight lines quoting as high as 10,000 dollars for California to Northeast runs.  Produce companies are experiencing huge overhead and taking losses during what should be the most profitable time of year.  Long range weather is showing a slight warming trend toward the end of this week and temperatures peaking into the 80s by this weekend.   Temperatures should then start to cool back down after the weekend and into next week.

LETTUCE — Generally this time of year sees declining lettuce sales due to the fact that more people are planning fruit salads.  This year is showing significant declines compared to last year thanks to expensive freight rates.  Product is coming out of Salinas and Santa Maria areas.  Weights are improving and quality is some of the best we have seen all year,

BROCCOLI — Good quality all around. Weather has been cool and mild for the majority of the growing period.  There have been some warmer days, but not hot enough to affect product.  There are plenty of deals out there.

CAULIFLOWER — Some discoloration issues, yellowing from sunburn and some molding but very minimal.  Shippers are able to sort through the product and preemptively solve any problems that may come up.  Some spotting has been detected, but not enough to affect overall appearance.

LEAF ITEMS — Very few problems here as well.  Weather has been very mild.  Leaf is very susceptible to hot weather, but our hot days have been minimal.  As the days warm up over the next week, we will be on the watch for problems that may arise.

CELERY –Salinas has officially started as Oxnard production continues.  Oxnard quality has been good, however, the beginning of Salinas is seeing some pale color and short stalks, but product is improving daily, as are numbers.  Seed stem is only about 3 inches, while 10 inches is allowed.    Delivered prices remain high and continue to climb as freight rates skyrocket.

STRAWBERRIES — Demand is high for berries as summer begins.  There have been some supply issues during transition from Oxnard to Salinas and Santa Maria, but Salinas production has come up with the extra fruit.  Non Driscoll shippers are looking for business and are significantly less expensive.  Quality is good; weather has been nice and cool, producing solid, colorful fruit.   Freight is cheaper with berries compared to lettuce or celery because more berries can fit onto a pallet.  It is because of this, high freight rates have actually helped increase demand for strawberries.

Warming Trend Out West

The next 5 days or so will be the FIRST extended warm spell we have had this year in California. What does this mean? For starters, it should bring on more strawberries, where up to this point, have been slowed for weeks by below normal temperatures. Also, this should help with tree fruit, melons, and grapes that need a shot in the arm for Memorial Day and beyond. This warming trend is certainly welcome overall, since we have had a record cold Spring.
No change in the truck picture. Even thought there are plenty of trucks, the continual rising fuel costs has got a death grip on the trucking industry, as well as our economy. As we have said in previous bulletins, we are currently paying as high as $2000 MORE for trucks to the East coast , than this time last year, and we haven’t even started the Summer fruit season. While we could see record rates, we ALSO see more trucks and truckers getting into the business for the Summer. Hey, if there is money to be made, more people will get in the business!
Long  range weather shows record HIGH temperatures coming into California the next 5 days, then cooling off to more normal.

LETTUCE–shippers are trying to get this market up, but aren’t having much luck. Not much interest in lettuce right now. Most stores have been advertising lettuce non stop, and are looking forward to “fruit” salads, which are just getting started.

BROCCOLI–this market has  picked up a bit after hitting the bottom the past 2 weeks.  Still, there are shippers looking for business this week, and we don’t think prices will go up too much more than where they are now. Quality is nice on 14s, 18s, and crowns.

CAULIFLOWER–the cooler weather we had last week slowed down growth and production and allowed the shippers to push their prices upward. We are now getting strange calls from some shippers who are looking for business, so we could see a WIDE range in price by this weekend, depending upon the label. We could see as much as a $5.00/box SPREAD in price on 12 size.

LEAF ITEMS–there is PLENTY of red, green, and romaine in either Santa Maria or Salinas. Prices continue to be flat and we don’t see any change this week.

CELERY–BIG problems out here with celery. Oxnard and Santa Maria, which are basically the only 2 areas going, are battling seed stem. We are hearing as much as 50% crop loss. Even the celery that IS being packed is showing seeders. The shippers are QUOTING their product with seed stem, so EXPECT IT. It doesn’t deter from the quality, just makes it unattractive. Celery is going to be a battle for the next 4-6 weeks, or at least until Salinas gets started in early July. With the high freight rates, $35-40 on the East coast is going to be the norm.

STRAWBERRIES–supplies have been a problem for the past month or so because of the cold weather we have had. But, the warming trend expected the next 5 days or so has GOT to help bring on supplies. Driscoll continues to pro rate 50% and higher on their supplies, but this welcomed warming trend should help even them.

Transition Time Again!!

No sooner did we get adjusted to switching from the desert region to Huron, Bakersfield, and Salinas, and we are soon going to switch from Huron to Salinas and Watsonville for our lettuce and leaf needs. This is just about right on schedule for the Spring, and actually we are looking forward to it. Not just from a quality standpoint, but the way the trucks are charging for extra pickups and miles, it will help to have product  more “consolidated”.
As we enter into the middle of April, the days are getting longer, nights shorter, and rain and threats of rain diminishing. The next 10 days look wide open, although a bit cooler than normal for this time of year.
Plenty of trucks available, but each company is saying they need more and more money to offset the every rising diesel prices. As we mentioned, these costs are passed on from the truckers to the buyers, to the stores, and ultimately to MRS. CONSUMER.

LETTUCE–Huron is winding down and Salinas is starting up this week. Next week will show even less in Huron and hopefully more supplies in Salinas. Quality is “hit and miss”, with most arrivals showing up okay(knock on wood!). Weights are picking up and overall size is, as well.
The market has been very strong the past week, although we are starting to see some resistance at the retail end, and demand starting to back off.

BROCCOLI–as we mentioned a few weeks ago, the month of April looks like it would be experiencing some product “gaps” with broccoli and cauliflower due to rains in January and February. That is what is happening here. With this, shippers have pushed their prices up the past 2 weeks and are holding strong. Even though demand is not necessarily strong, supplies are remaining light enough to allow the shippers to keep things firm

CAULIFLOWER–strong market, as mentioned above. We see this continuing through this month. We are loading most of our supplies in the Salinas area, although Santa Maria is producing, as well. The desert is all but finished.

LEAF ITEMS–supplies are coming out of the desert, Oxnard, Santa Maria, Huron, and Salinas. That is keeping the markets on red, green, romaine, and boston in an “uncertain” mode. Some areas that are less desirable either for truck or quality sake have had to discount their prices to get some business. The best quality appears to be coming out of Salinas and Huron districts.

CELERY–wide range in price here. The “preferred” labels such as Dole and T&A are commanding more money than the general markets on just about all sizes. The desert is just about finished, which will put us in Oxnard and Santa Maria areas for all of our needs.

STRAWBERRIES–there are LOTS of ads out there. We had a bit of a hot spell in central and Southern California over the weekend, but has since cooled off. Unfortunately, the quality will show up in arrivals starting THIS WEEKEND! We are keeping our fingers crossed that the berries arrive okay, but it is important to know that you must get them in and out as quickly as possible. From a market standpoint, Driscoll is quoting $3-5.00/box MORE than the general quotes. Why? Because they CAN!!

ASPARAGUS–tight supplies and STRONG market. Prices are upwards of $40/box FOB and shippers are getting those prices. Supplies are coming out of Stockton, Lodi,, and Salinas areas.

Transition Time

Except for the West Coast, business for Easter ’08 is done. Trucks are either at their destinations or on the way. As a result, business is starting to back off this week. In fact, many orders that were scheduled to load this week are being canceled or cut back, as buyers see that they have TOO much product on the way or in their warehouse. This is certainly typical going into just about any holiday week.
Next week, the week of 3/24, starts the Spring transition for 2008. Huron starts with head lettuce, romaine, mix leaf. Salinas starts with broccoli and cauliflower, as well as other specialty items. The desert areas will still be going, but as the temperatures heat up, things will come to a RAPID close. Of course, the markets have plenty to do with how long shippers will go. If prices are good, expect them to hang on for as long as they can. If markets are sloppy, they won’t hesitate to “pull the pin”
Long range weather shows Spring-like conditions in Salinas, Santa Maria, Oxnard, and Huron areas with cool, mild, dry days and cool nights. The desert shows temperatures pushing the 90’s during the day.
Trucks are SCREAMING about the high fuel costs, and pushing truck rates just about every day. Just to give you an idea, we are getting quotes that are equal to, or MORE than the end of May or first of June! We have NO idea what the Summer holds as far as rates are concerned.

LETTUCE–steady. The desert will be finishing up for the most part next week, while Huron is looking to start. We aren’t sure what the market will do. An overlap usually means it will remain steady to sluggish, while a “gap” could allow prices to be pushed upward. Quality is another issue. Hot temperatures in the desert hurt quality, while the first lettuce coming off Huron fields are usually nothing to write home about, either.

BROCCOLI–strong market. Supplies are a bit light and demand is good. Prices are higher than last week, but as Easter demand cools, we could see prices stall out.

CAULIFLOWER–shippers have been pushing prices up for the past 10 days and could be close to maxing it out. There will certainly be resistance at the retail end, which will slow demand.

LEAF ITEMS–no change here. The desert will continue to go for another 10 days or so, and Huron will get cranked up next week. We aren’t sure where the markets are headed, so we will say things will be “steady” going into next week.

CELERY–demand is backing off, after the Easter push. The desert will go another 2 weeks, then switch totally back to Oxnard for the Spring. We don’t see the celery market doing much for a while.

STRAWBERRIES–we got through the Easter week in fairly good shape. Our wish came true, in that Florida hung on long enough with acceptable quality to supply most of the East coast with their needs. That was certainly welcome in California! We see supplies really starting to pick up as we get closer to April.

ASPARAGUS–shippers are desperately trying to hang on to their prices after the Easter pull. But, demand is really falling off, with orders being cut back, or canceled. The expected hot temperatures in the desert will finish off the desert deal very quickly, then we will switch to the Spring deal in Stockton and Lodi.

Spring Training

Major League Baseball teams are starting to gather their players together for the upcoming season. One place that many teams come to for Spring training is in the Phoenix, Arizona area. Warm days, and mild nights are the things you notice right away, and desert vegetables are not far away. Yuma is only a few hours away and has the same kind of weather. So, we associate Spring training with the Spring vegetable time. Most items are REALLY starting to come on and, in particular, asparagus. It’s getting to be THAT time of year.
Long range weather for the next 10 days in the desert growing areas show highs getting into the high 70s and low 80s. More importantly, lows are in the high 40s to low 50s, which are out of the FREEZE territory.
Still plenty of trucks, and with fuel costs dropping a bit, rates are more flexible.

LETTUCE–plenty of lettuce, and size and weights are picking up. In fact, we are seeing some big, HARD heads that aren’t necessarily attractive on the shelf. We are after lettuce in the mid 40’s for weight and medium large head size. The market remains fairly flat.

BROCCOLI–good supplies of 14s, 18s, and crowns and the markets remain fairly flat. Quality mostly nice out of the desert, while product in the Salinas and Santa Maria areas are not as good. Purple cast and some water spotting showing up.

CAULIFLOWER–not much change here. Markets steady, as are supplies. We are seeing a few more 9 size and there could be some good deals there this week.

LEAF ITEMS–good supplies of green, red, boston, and romaine, and prices are steady to slightly lower. Quality improving daily, as we are slowly working out of the freeze-effected product from December and January.

CELERY–steady to slightly stronger on all sizes, especially on the smaller size 36s and 48s. Supplies coming out of Oxnard and the desert, making truck loading easy.

ASPARAGUS–as temperatures in the desert climb, so do supplies. Most everyone has shifted to 28/1# containers. Demand for grass hasn’t kicked in yet, so there are deals around that are being done for less than the “quoted” prices. Good item to push for the weekend.

STRAWBERRIES–dry, mild weather in the berry country of Oxnard and Los Angeles for the next 10 days, which should bring on supplies. In fact, Driscoll says they should double their numbers next week of what they are currently doing. Prices are still not close to Florida, but we DO have nice quality and should improve daily as long as it stays dry.

Slowing Trend

Now that the holidays are over, demand is sluggish.  The days are cold, causing slow growth for most items.   Desert temperatures remain cool, some nights are below freezing, and as stated before, can result in epidermal peel, blister and discoloration.   Demand has not picked up and markets are settling to where they normally are this time of year.  We are encouraging our customers to begin thinking about ads, especially with broccoli, cauliflower, head lettuce and romaine.
Plenty of trucks looking for loads.  Trucks rates are decreasing slightly, but mostly leveling out due to record high fuel costs.  Rates are much higher than last year because of this.
Forecasts show less rain in the coming days, giving us a chance to dry out.  Warmer temperatures are expected as well.

LETTUCE — Cold nights are definitely taking their toll on head lettuce, supplies are improving from last week, but we are still seeing quite a bit of epidermal peel, blister peel and discoloration.  Most of the problem is on the external leaves, shaving the heads at production and receiving levels  has helped, but continue to be aware of these problems that are typical for this time of year.

BROCCOLI — Sharp drops in the market, we saw the broccoli crown price drop by a few dollars overnight  late last week and adjustments had to be made.  Some discoloration has been found, a result of as little as one or two nights of freeze.  As we said before, expect discoloration and make it clear that it is an industry wide problem we are facing at the moment.

CAULIFLOWER — Very similar to the broccoli market, prices leveled out as cost exceeded demand.  Cauliflower is very affected by extreme elements, so there have been a few quality problems mostly with discoloration.  Shippers are NOT standing behind these problems, as they are also industry wide problems.  Some 9s are now available, however supplies are still light, as we are seeing more smaller sized cauliflower, once again, due to cold temperatures in the desert.

LEAF ITEMS– Still showing epidermal peel and other defects.  The leaf market has been gradually  slowing, warmer temperatures will significantly help growth of romaine, red and green leaf, hopefully the recent cold will be short lived.

CELERY — Still fairly steady, most sizes are ready and available. Production has mostly recovered after last week’s rains in Oxnard and the desert.  Expect prices to hold steady for now, production should increase as the temperature warms this week and next. Smaller sizes are more prevalent and shippers are looking to move.

STRAWBERRIES –Berries are trying to make a move but the cold temperatures are holding back production.  Santa Maria and Oxnard areas are staying dry, but the cold is still hindering color on the berries.  Shippers are not ready to promote just yet, but will have a better idea in the next coming weeks. For now, we just have to wait and see.