FREIGHT RATES HURTING DEMAND


$15.00/box seems like a decent price for a box celery. But, that’s not the fob, that’s the FREIGHT to the East coast! Rates of $9000 and UP are what truck rates are going for to the Pennsylvania, New York, Massachusetts areas. Beside celery, other examples of what freight would be are, $9.50 for wrap lettuce, $8.00 for broccoli, $10.00 for romaine, even strawberries are upwards of $3.50/box. These rates, alone, will keep the fob markets from going too high for very long.

Long range weather in the Salinas growing areas show a gradual warming trend to more normal temperatures. The San Joaquin Valley, where the tree fruits are coming from is also warming into the 90s, which is more normal for this time of year. So, we are finally starting to see temperatures climb up to where we SHOULD be.

As mentioned, truck rates are pushing $9000 to the East coast, and we have even head close to, dare we say, $10,000 for milk run mixers! That is CRAZY. But, at the same time, it’s hard to imagine rates going higher. We’ll see.

LETTUCE–a bit of a range in price, depending upon the area and label. Some shippers think prices may go up, but, again, the high freight rates increasing retail prices will have something to say about that.  Even if prices do go up, it won’t be much. Maybe a dollar, or so. Quality is improving daily, as we start to warm up.

BROCCOLI–still a shortage here, especially on crown material.  However, we see this market starting to come down, as supplies are expected to increase later this week. We are loading broccoli out of Salinas and Santa Maria areas.

CAULIFLOWER–like broccoli, still a bit short in supplies, but should pick up as the week goes. With fob prices upwards of $18-20.00, it is important to buy with protection, as the market won’t come down just a dollar at a time.

LEAF ITEMS–just too much product around. Romaine, green, red, and boston are all dirt cheap. The only thing keeping retails up are the freight rates. As mentioned above, a box of romaine is upwards of $10.00, just to haul it to the East coast!

CELERY–$15.00/box freight? Say no more. That alone keeps shippers from pushing their fob prices up. Also, Salinas is just starting their Summer deal, and Oxnard will wind down in the next 2 weeks, so we don’t see this market doing much, although there could be some deals out there if you shop around.

STRAWBERRIES–everyone expects demand and prices to hit a wall. And, while we DO expect supplies to pick up, it probably won’t be until the end of this week. For now, most shippers are sold out today and tomorrow. Driscoll, in particular, says they are basically sold out through midweek, and indicate they have strong bookings for the entire week. Good news, is, quality is improving overall, as we aren’t seeing the white shoulders that we have seen the past few weeks, which were rain-effected fruit.

Ed Brem

ed@producewest.com

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