TIGHT TRUCKS + STRONG MARKETS= HIGH DELIVERED PRICES

Memorial Day usually kicks off not just the Summer fruit, but also kicks off the race for the truck rates. Already, we are hearing rates upwards of $9000 for East coast mixers, and some as high as $10,000 to the far east coast. This is an increase of $3000-4000 from just a month ago. Put that with increased fob prices for lettuce, broccoli, cauliflower, and other items, and it’s easy to see why delivered prices have skyrocketed. On the other hand, this is nothing new, as this happens every year. We just don’t know from year to year how HIGH rates will go.

Long range weather shows some rain showers today in central and northern California, which could be especially damaging to the cherry crop, which is nearing its summer peak.

Trucks continue VERY tight for most areas on the country, especially to the east coast. As mentioned, rates continue to climb, and could get up another $1000 in a few weeks.

 

LETTUCE–shippers really pushed this market up the past few weeks, and with the higher freight rates, it is now $25-30 delivered at the eastern markets. We feel the market has now peaked out, due to the higher retail prices, as now some consumers find it is cheaper to buy bag salad, instead of a head of lettuce. Still, even if the market comes down $5.00, delivered prices will still be up there.

 

BROCCOLI–lighter supplies here, too, and stronger market. Crowns have gone up $5-6.00 over where they were 2 weeks ago, so with the increasing freight, we could see crowns closing in on $20.00+ on the east coast.

 

CAULIFLOWER–cooler weather in Salinas early this week will keep supplies lighter than we have seen. Shippers have already raised their markets last week, so retails will change. We could see the market come off by the end of this week.

 

LEAF ITEMS–no change here. Plenty of supplies of romaine, red, and green and the fob prices are still lower than normal. High freight rates will keep things down, especially with local product throughout the eastern seaboard.

 

CELERY–markets still hanging in tough, in spite of the increasing freight rates. Keep in mind that a box of celery to the east coast can run as high as $12.00/box this time of year! That easily pushes delivered prices for celery to $25/box.

 

STRAWBERRIES–there is plenty of fruit, and most shippers looking for business. Except for Driscoll. Surprise, surprise. With cooler temperatures and a threat of rain today in Salinas and Watsonville, things could turn around and ALL shippers may tighten up. We’ll have to see how much, if any, rain we get, and then we will know more.

 

Ed Brem

ed@producewest.com

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