Volatile Markets

With the strange weather patterns we have had(warm, then cold) and  water shortages in the San Joaquin Valley causing many fields to go un-farmed, we are really seeing volatile markets. When the weather warms, supplies come on, and the markets fall. When the weather turns cold, supplies fall off, and the markets jump. The past 2 weeks, with Easter business going, we reported demand exceeds supply and strong markets on just about all of the major vegetable items. This week, we expect to see continued active markets on lettuce and leaf, while broccoli, cauliflower, romaine, and celery are anticipated to be down. Of course, much depends upon retail prices. When prices are raised, demand certainly takes a hit, and prices fall.
Truck rates are certainly on their way  up. Easter is usually a “spring board” for truck rates as we get ready for heavier strawberry movement, which increases demand for trucks. Following this right around the corner, is the tree fruit, grape, and melon season, and rates climb to their yearly highs by mid-Summer.
Long range weather for the next 10 days, show cool temperatures for the next few days, but much warmer weather is forecasted for the weekend. No rain. In fact, we are just about OVER our rain season, until late Fall.

LETTUCE–still a very active market. The Huron deal has been a real chaotic one. First, there has been a water shortage, due to lower than average snow pack in the Sierras for the past 2 years(now THREE years!), so water districts have been rationing water in the San Joaquin Valley. As a result, growers didn’t plant much lettuce for the Spring. Along with that, cold temperatures in February made the lettuce VERY small. To the point that shippers say they are packing more than 50% 30 size. This is keeping demand and prices VERY strong for 24 size. We hear that this will be the case for the entire Huron deal, which will finish up within the next 2 weeks. Salinas is just barely getting going, so there could be a slight gap between the 2 areas with some shippers. Overall, though, we expect a BUMPY transition between Huron and Salinas.
BROCCOLI–supplies have really picked up, after the past 3 weeks of VERY light supplies, and virtually NO crowns. Now, we are seeing better supplies of bunch AND crowns. Along with that, the market has dropped to less than 1/2 of what it was 2 weeks ago. We will probably see this market bottom out this week, and perhaps rebound next week.

CAULIFLOWER–a real roller coaster ride. 3 weeks ago, supplies were abundant, and the market strong. These past 2 weeks, supplies have been light, and the market active. This week, retails are high, demand has fallen off, and prices are down. By this time next week, we could see prices double what they are today.

LEAF ITEMS–still light supplies of red and green leaf, especially green, and prices are still VERY strong and high. Romaine is fairly abundant, although we are seeing a pretty good range in the market there. This is one to shop around. Like head lettuce, supplies are light in Huron, and the transition to Salinas is going to be sporatic.

STRAWBERRIES–we got through Easter in fairly good shape, with supplies enough to go around, for the most part. A BIG factor was the East coast weather, which was lousy, and kept demand down. Supplies look to REALLY increase this next week, and there should be plenty of fruit to go around. The next big push will be for Mother’s Day, which is May 10th. Shipments for that to the East coast will start in 2 weeks.

ASPARAGUS– there were VERY light supplies for the Easter demand. The Easter push wasn’t much, fortunately. As we have stated in previous reports, with the economy the way it is, big ticket items such as asparagus take a back seat to consumer demand. So, shippers that think they have been thinking they will get $50 for a box of asparagus because they have light supplies, are dreaming.

CELERY–continued wide range in price, depending upon the shipper. The “preferred” shippers are still demanding $4-5.00/box more than the mostly market shippers. So, there are deals on celery, especially the larger sizes. We don’t see much change in the FOB prices for a while. To go with that, as freight rates start to climb, celery gets hit the hardest because of the heavy boxes, and higher “per packaged” costs. That, we feel, will keep the celery market down.

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