MARKET EXPLOSION

Record freeze in the desert has caused an explosion in market prices.  Since last week prices on certain items have doubled, which will soon send shockwaves to retail prices.  The cold weather has been the main factor, resulting in weak, diseased product that due to its poor condition can’t even make it out of the field.  Smaller factors such as high fuel prices and labor costs are also contributing to the high prices.  Shippers are only covering contracts on certain items and pro rating the remaining orders, it is real ugly out here.

There is good news however; long range weather shows a warming trend in the desert that began this past weekend and is expected continue into next week, with temperatures in the low 70s and even creeping up into the 80s.

Truck rates that came off over the past few weeks are holding steady this week while they wait for business that may never come.  As we stated before, fuel prices are high for this time of year and truckers are crying the blues.

LETTUCE — Quality is terrible, and availability is spotty.  Shippers are all telling us that the quality is just not there, and the product has not recovered from the freeze damage.  The main problem is a disease called sclerotinia, which thrives in cold weather and wet soils.  It chokes the plant at the root and prevents normal growth. Some shippers are quoting acceptance final, which tells us this surely is an industry wide issue.  Weather is warming but the damage is done, and although harvest crews are doing their best to shed leaves of affected heads, much of the product is diseased and must be plowed under.  The weather has improved since last week, but we do not expect quality and availability to significantly improve until next week at the earliest.  Shippers do not want to hear about problems because there is nothing else out there to sell.

BROCCOLI — Cold and wet weather does not affect broccoli as extensively as leaf items, but it still has trouble developing in the colder weather.  The result has been a decrease in volume over the past week.  Some shippers have bunch broccoli but no crowns, some have no broccoli material at all. Quality is ok with no major problems to speak of, but getting product is the major concern.  Warmer weather forecasted will bring on more product by the end of this week.

CAULIFLOWER — Very similar conditions to broccoli.  Product did not develop in the cold weather and is now trying to catch up.  Cauliflower will be the first of these items to show volume improvements and we should see better numbers by the end of this week.

LEAF ITEMS — Many of the same growth issues as lettuce, however, leaf was not a victim of disease.  The cold weather simply stunted normal growth patterns.  Romaine has been the most affected by the cold and current market prices reflect this.  There has been some normal desert blister and peel on all the leaf items which has not helped matters, but like broccoli, leaf supplies will hopefully recover by the end of this week.

CELERY — Lighter numbers than normal, the result of the heavy Oxnard rains a few weeks ago.  There is smaller sized celery currently available, but we are hoping that product begins to size up by later next week.  Knuckle cracking has been an issue, which is exceptionally challenging because it cannot be detected until product in the box and/or in transit.  Although we are seemingly out of the water, expect retails to remain high for the time being.

STRAWBERRIES — supplies are still picking up in the desert, and prices are slowly coming down. Florida is getting some nice weather and seems to be keeping up with demand for the time being. Western berries will need to drop their prices substantially to compete with Florida, so we will keep an eye on it.

Ed Brem

www.producewest.com

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