The Source - March 20, 2019

Washington:
In the world of apples, shippers continue to struggle with loading large volume for foodservice sizes (125ct, 138ct, and 150ct) on all varieties. We continue to see decreased volumes in eastern growing regions; which has shifted demand out west. This has caused prices to slowly increase, while export business helps to maintain the elevated prices. Expect this state of affairs to remain for the rest of the season and know that some size substitutions will be necessary going forward.

Eastern Region:
As previously mentioned, many regional growers are slowing down and are also struggling with covering large volumes on smaller sized fruit. Some major retailers are heading west to get orders filled; leaving shippers to obligate much of their remaining fruit to contract business.

Alerts:
Food service sizes (125ct, 138ct) are getting harder to come by. Start thinking about sub sizes on mixer-load orders.

Supplies continue to be good this week as fields continue to yield decent volume. We are expected to see good supply thru next week out of Caborca. Then supply is expected to decrease due to seasonality. Markets out East and West are weaker due to more supply and less demand. We are anticipating markets to continue to be lower thru next week as volume out of Caborca will remain strong.

Ideally, an avocado tree should produce a similar crop each year, but avocados trees have a tendency to adopt an alternate bearing cycle – an on-crop/off-crop cycle. 2018 was an on year, but faced issues with the heat wave and fires in these growing regions. Harvest crews are currently maintenance picking, as well as size picking. Growers are reporting that there is still visible damage to the trees, as well as leaf burn. Because of the issues in 2018, there will be a 50% reduction in production in 2019. With very light offerings, fruit that is harvested is being exported.

Weather in the growing region of Michoacan Mexico this week calls for lows in the 40s and highs in the 70s. This week demand is fairly good, stronger market, and prices continue to increase on all sizes (32s-48s). There are some deals on older fruit but the market has definitely gotten stronger. Monday the 18th was a holiday in Mexico and there was no harvest. With less fruit in the pipeline, we can expect higher prices. Overall quality is great. This late in the season you get better tasting fruit due to maturity.

Pepper supply is still very tight, even though there is some new acreage starting. The new fields are producing better quality but there is not enough volume to relieve the market. Growers are still working on older fields also that are producing smaller and choice pepper, the quality is only fair and volume is decreasing weekly. There is very little supply coming from Mexico as there shippers wind down for the season early and California growers are late creating a gap in western supply. The Florida spring deal will not be in steady production until the last week of March and heavy rains are moving through the region today slowing harvest even more so we expect tight supplies for the next week at least.

Alerts:
Pepper supply is still very tight.

• Green Bell Pepper- Light volume of green bell pepper continues to arrive in Nogales this week. Currently, low volume is being harvested in Sinaloa and Sonora. The quality on green bells from both regions is good. Demand currently exceeds supply on green bells. Supplies on green bells are expected to increase through the week as better temperatures are being seen in the growing region. Market on Green bells is high/steady on all sizes. Green bell peppers from Mexico are also available to load in McAllen, TX.
• Red Bell Pepper- Good supply of Red Bell pepper arriving in Nogales, AZ from Mexico this week. The market/price on the red bell pepper has started to decrease this week. Better volume on both elongated and Hot House bells in all pack styles. Better numbers on both varieties are expected through the week. Quality of red bell on both varieties is good. Red bell supplies from Mexico currently crossing through both Nogales, AZ and McAllen, TX.
• Yellow Bell Pepper- Moderate volume of Yellow Bell pepper continues to arrive in Nogales this week. Both elongated and Hot House varieties being pack in 11lb/15lb and 1 1/9 bushel carton. Quality on both varieties is good. Currently, demand exceeds supply. Market on yellow bell is still strong. Yellow Hot House bells are also available to load in McAllen, TX.

Blackberries are still in good supplies out of Central and Baja Mexico. The market is steady and quality is reported to be good. There look to be no changes in pricing through the end of the week.

Several blueberry-growing regions in Chile are seeing unseasonably cool weather experiencing minimum temps in the low 40s with some isolated locations dropping down into the 30s. These temps are about 10 to 15 degrees below normal for this time of year.
Here in the United States, the central Florida growing regions of Plant City and Alachua are gearing up for the start of blueberry harvest. They will experience cool temps today through Friday. These regions will see max temps right around 70 and min temps in the upper 40s to low 50s. Temperatures should return to normal by Friday of this week.
Mexico continues to pump out steady but lower volume and continues to be distributed through main southern ports of entry in Texas and Arizona. They are then moved on to strawberry distribution points in California, Texas and Florida.
Look for prices to remain firm with Florida homegrown berries commanding a premium. The prices may go higher as we wait for the new crop export fruit to arrive in better numbers and several shippers report weather-related gaps.

Alerts:
Look for markets to stay firm to higher as several shippers are gapping due to weather issues in existing areas and waiting for new crop product to ramp up in volume

Raspberries are being produced in the same growing regions as the blackberries, Central Mexico and the Baja peninsula. The market is steady and the quality is reported to be excellent. Look for this trend to carry on through the week.

California is currently enjoying the tail end of several days of dry warmer weather. Temperatures have steadily risen since last Thursday and plants are setting up nicely for better quality and production towards the end of next week. That being said we are expecting another storm to pass through the growing areas on Tuesday night. As the storm front passes we are expecting cooler temperatures Thursday morning. Rains are expected to be light. These cooler temperatures will last through the weekend with another chance of rain occurring Monday which is projected to linger through Wednesday. These weather occurrences continue to keep production lower and markets firm.
Mexico is still crossing very small numbers through McAllen Tx. and San Diego Ca. weather and market conditions and cost efficiencies will dictate how much longer this will occur.
Florida is in a very similar situation with the shippers still covering minimal instate business and previous commitments. The season is all but over and speculation is that given optimum conditions it may last to the end of the month.

Alerts:
More light rain and cooler temperatures are on tap for this week in California followed by a break over the weekend and then another front moving in Monday

Transitions:
Mexico and Florida will continue in a light way through the end of this month . Oxnard, and Santa Maria are set to reach good production by the end of next week weather permitting. Salinas ands Watsonville are looking to start production in a light way in 2 weeks first week of April .

The broccoli market has stayed steady with the nice weather in Yuma and Mexico. This warmer weather the next several days in Yuma and Mexico is helping to spur growth. Look for supplies to stay steady with the improved weather. Quality is good with slight purpling, some mechanical damage, and occasional yellow cast.

The Brussels Sprout market continues to remain snug with supply being affected by the recent and current rains in Salinas and Oxnard. The quality has been affected by the rain and cold weather and sizing tend to run smaller due to this recent colder weather. Look for the Brussels Sprout market to remain tight going into next week.

The carrot market continues to remain steady. The quality is good, and supplies are adequate to meet current demand. We see no change in the carrot market going into next week.

Cauliflower has started to become tight as suppliers are hitting a gap. The Yuma weather continues to spur the growth process which has brought the fields ahead of schedule. Overall, the quality is good with minor bruising and yellow cast with weights in the 25 to 28-pound level. Look for this market to continue to adjust going into next week.

This market for this commodity continues to set unprecedented prices throughout the industry. Demand exceeds supplies. The strain on availability will continue throughout the end of this month as well as April. Some suppliers don't expect this commodity to have normal availability until late May to June. Oxnard and Santa Maria are the growing regions for this commodity with little to nothing in production in Yuma. Mexico has been a region a few shippers have been harvesting in and this has helped with availability. Oxnard and Santa Maria does not have the availability to meet demand. The overall quality is fair, with pith, insect damage and leafiness being reported upon arrival. Escalated pricing will continue with all shippers.

Alerts:
Supplies remain limited and markets are higher.

• Jalapenos- Better supply of Jalapeno is available this week and is available to load in Nogales, AZ from Mexico. Growers continue to harvesting jalapeno out of the Sonora and in Northern/Southern Sinaloa. Quality out of Sonora is good. Quality out of Sinaloa is good. Mostly medium to large size is available from both growing regions. Market on jalapeno has started to decrease and should continue to decrease as we end the week. Jalapenos from Mexico are also available to load in McAllen, Texas.
• Pasilla- Good supply of Pasilla peppers are available to load in Nogales, AZ from Mexico. Good volume continues to be seen this week and should continue through next week. Quality on Pasilla is good. Size on the pepper currently ranges from Medium to Extra Large. Market on Pasilla is currently steady. Price on Pasilla pepper is expected to decrease moving towards the end of this week. Pasilla crossing through Nogales is being harvested in the Mexican states of Sinaloa. Quality from Sinaloa is good. Pasilla from Mexico also available to load in McAllen, Texas
• Anaheim- Better supply of Anaheim currently available to load in Nogales, AZ from Mexico. Steady Anaheim production expected through week. Anaheim crossing through Nogales is currently being harvested in the Mexican states of Sinaloa. Quality of peppers from Sinaloa is good with mostly large size being packed. Market on Anaheim is slightly higher. Anaheim from Mexico also available to load in McAllen, Texas
• Serrano – Good supplies of Serrano peppers available to load in Nogales, from Mexico. Supplies are expected to remain steady through the week. Supplies currently meet demand. Price on Serrano pepper also decreasing on a 40lb box and #10lb Pack. Serrano supplies also crossing through McAllen, Texas.
• Tomatillo – Husk and Peeled tomatillos are available to load in Nogales, from Mexico. Quality on both varieties are good. Good supplies on both husk and peeled tomatillos are expected to continue through the week. The tomatillo market is steady. Prices remain steady in the low teens. Both varieties of tomatillos also available to load in McAllen, TX.

The Cilantro market has come off a bit in Yuma and Mexico with the recent warm weather in Yuma and Mexico. The cilantro quality is fair and has been affected a bit by the colder weather at the beginning of January. Look for the cilantro market to continue to stay steady going into next week.

District 1&2 (Central Valley & Southern California Coastal Region) is coming along nicely and peaking on 75ct/95ct/115ct. The smaller size fruit 140’s and smaller are tightening up for the next couple months. Prices are firming up and looking to remain steady in the mid to high $20’s on choice and fancy fruit. The rain and cold weather brought on the larger fruit and smaller fruit is staying limited on sizing and green on the trees.

The market continues to be active and is expected to continue on a weekly basis. Inbounds from Mexico have been very light and demand has increased. Peak sizes remain to be 200’s & 230’s. Industry-wide, we should expect 110’s & 150’s to be light in supplies. Reports from Mexico are that March will be a very short month on quantities. We are advising customers to avoid running lime ads for March due to unpredictable quantity and lack of commitments from the growers.

Alerts:
Less inbounds coming from Mexico and rain in the growing regions with high demand has driven the market prices up.

Navels are starting off the week with good supplies, with plenty of volume to promote. The Central Valley is expecting light rain Tuesday night through Wednesday afternoon. We’ll get a two-day break before another storm comes through Saturday. The small fruit supplies are starting to dwindle a bit, but there is still more to come. Markets are looking steady and plenty of deals to be made to help move fruit. On Specialty Citrus we still have plenty of Delite Mandarins that are peaking on 15 - 40. Plenty of Pummelos available, sizing and quality looks great. Cara Caras & Blood are moving along, steady supplies are available. Golden Nugget Mandarins Ojai Pixie Tangerines are back this week, quality is looking a lot better and the taste is excellent. Please reach out for pricing.

Cucumbers supplies have started getting better as local Florida cucumbers have stated. Some shippers are still importing cucumbers from Honduras and will continue through the month. A few Florida growers have started in the past week, the first quality reports are very good. With the Midwest and northeast enduring extremely cold weather demand has decreased dramatically. The weather this week is going to be cold, cloudy and wet, not conducive to good production but after this week we expect better production.

Alerts:
Domestic cucumbers have started.

Good supplies of cucumber crossing through Nogales, AZ this week from Sinaloa, MX. Quality out of the Sinaloa district is good. Light supplies of cucumbers also starting to be harvested in the Mexican State of Sonora this week. Supplies have increased as growers in Sonora have started to harvest new fields. Currently, all sizes being packed in 1 1/9 bushel pack and carton cucumber. The cucumber market has stabilized and is expected to remain steady throughout the week. Quality out of both districts is good.

Eggplant supplies are very tight, some new fields have started but the production insignificant. Quality overall is poor as most product is coming from older fields. New supplies are set to start in late March or the first of April. We do not expect any increase in volume or quality until new fields start.

Eggplant- Eggplant continues to be harvested in the Mexican State of Sinaloa. Good supplies of eggplant currently being harvested and have increased this week due to good weather in the growing region. Both fancy and choice grade currently being packed. Market on eggplant is expected to remain steady through the week. Quality from Sinaloa on fancy and choice pack continues to be mostly fair to good.

Green grape availability is fairly consistent this week, but most shippers are warning of lighter supplies starting in the next 2 weeks. Arrivals of import green grapes are expected to slow down by the beginning of April and come to an end by mid-April. Shippers will begin to stock up on storage supplies over the next several weeks and slowly release inventory from controlled environments as needed. However, supplies will be monitored closely and market prices will certainly start to climb. I expect to see some challenges with supplies and quality by the end of April. Prices will start to work their way upward as we move forward. Mexico and Coachella harvest are expected to start early to mid-May.

Alerts:
Supplies of green grapes will lighten up starting in the next 2 weeks and will be a challenge for the remainder of the import season.

Transitions:
Mexico and Coachella are expected to start early to mid May.

Peak Seasons:
We are past peak production and supplies will drop off quickly.

Chilean red grapes continue to be steady this week. We are seeing good availability of all sizes. Quality has been good with a few reports of soft or wet berries. Demand seems to have tapered off over the last 2 weeks. Market prices have been steady since last week. A medium / large red grape ranges in the high teens and an extra large is in the low twenties. We expect supplies to be consistent for the next month with fresh arrivals of fruit through April. Mexico and Coachella will start to harvest mid-May.

Transitions:
Mexico and Coachella harvest is expected to start early to mid May.

The Green Onion market continues to come off with the recent nice weather in Mexico. Currently, the weather has cooperated and we are seeing supplies increase as a result. The recent cold weather in January is causing occasional leaf minor and mechanical damage. The green onion market will continue to level off going into next week.

The kale market continues to come off this week as more supplies have come on with the recent nice weather in Yuma. Quality is good with full bunches, and only an occasional yellow leaf being reported.

Lettuce supplies have been hit and miss. Depending on the shipper and the exact growing location, supply reports vary. Overall, we continue to see fairly consistent availability. Quality has been fair with reports of ribbing, lightweight, puffiness, and mechanical damage. The weather in Yuma is expected to remain warm over the next 5-7 days, so we do expect to see some improvements in weight and quality moving forward. Market prices have been gradually adjusting up since last week. Again, depending on the shipper, we are seeing a wide range. We do not foresee any major disruptions in supply as we look toward transition. Huron is expected to get started later this month.

Transitions:
Huron is expected to start late March.

Leaf lettuces have improved in quality and volume over the last week. Better weather in the Yuma growing regions has contributed to the improvements. Although we are seeing some better quality, shippers are still warning of residual damage such as blister, peel, and discoloration. Due to the volume increases, we are seeing the markets react and adjust down gradually. Demand has been moderate. With the warm weather expected to last another 5-7 day in Yuma, we can expect to see much of the same over the next week. Huron is expected to get started by the end of March.

The Tender Leaf market is steady on spring mix, arugula, baby spinach, and cello spinach. Quality is good with minimal yellowing and bruising of the tender leaves. Look for these items to be steady going into next week.

Cantaloupe (offshore)
New arrivals this week, and projected arrivals for next week have a significant shift in sizing to larger fruit which will begin to put a premium on smaller fruit (12s/15s). With many retailers running melon promotions, the larger fruit (9s and larger) will affect the market causing it to stabilize. Solid arrivals are expected next week but a sizable decrease in volume the last week of March (3/25) which could put additional pressure on an already short market. The decline in volume is directly attributed to the whitefly situation in Guatemala. Cantaloupe quality has been strong and solid brix levels in the 10-12% range.
Domestic Fruit (Arizona)
Ideally, the Spring season starts up in late April, early May. Huge setback growers are currently facing is the heavy rains and abnormal cold temps we saw this winter. Some growers lost crops and had to replant. The first harvest is expected mid to late May weather permitting. We will also see some Galia variety of melons available.

Honeydew (offshore)
Production remains strong and will continue to be for the next few weeks. Sizing has shifted to larger size fruit (5s/6s) and lighter offerings on small fruit (8s/9s). This market should hold steady for the next 2 weeks. We are seeing better quality externally and brix levels ranging from 10-12%.
Domestic Fruit (California)
We are about 2 weeks out before growers begin planting the summer crop. Cantaloupes will start in July with honeydews to follow. Mix Melon Varieties will ramp up in August.

Light supplies of watermelon available to load in Nogales, AZ this week. The Watermelon crop from Colima is slowing down and is expected to finish sometime next week. Quality from this district is fair to good. Watermelon crop from Sonora, MX is expected to begin as soon as next week. Market on watermelon is currently high and is expected to remain high until the Sonora, MX crop begins.

Onion markets remain active in Idaho and Washington as demand is heavy and the season winds down. Yellow and red pricing has reached the middle teens with white onions extremely high and very limited. Late storage crop yellow onions in the Northwest are expected to last through April, Mexico is crossing a few more yellow sweets and white into the U.S. with domestic Texas starting up on yellow onions this week. Expect domestic Texas red and white onions to follow the first week of April. California desert region is expected to start with new crop yellow onions mid-April. Quality remains good with some translucency showing up in the late storage onions. A reminder that the translucency must be two full rings in order to be considered a quality defect. Proper air circulation in your onion holding rooms is essential this time of year.

Alerts:
Markets remain active; especially red and white onions.

We are beginning to see some activity within the pear market; especially on foodservice sizes (120ct, 135ct). WA D’Anjou and Bosc prices are slowly increasing as demand gradually increases. Much like the apples, be mindful of possible subrequests on smaller sizes.

Demand for pineapples industry-wide and tighter supplies before the Easter pull will provide challenges covering certain sizes in full. Suppliers are doing their best to keep up with the current demand. Quality is looking good and Current market prices on all sizes are between $10-$12.

Russet potato carton markets are steady to slightly higher consumer demand picks up and production on cartons increases. Large size 70 count and up remain light in supply especially as we transition into Burbanks. The Burbank storage crop size profile will lean towards 80 count and smaller. Larger size potatoes will remain limited for the remainder of the Idaho storage crop season. Washington, Colorado, and Wisconsin continue to produce smaller sizes as well. Expect markets to remain firm. Quality issues for late storage potatoes include internal/external bruising, light hollow heart, external cuts, light peepers, and occasional soft rot. Please continue to place potato orders that contain those larger sizes 3-4 business days in advance to ensure coverage.

Alerts:
Russet 70 count and larger limited out of Idaho

Red potato and white potato markets are relatively steady with yellow potatoes increasing. Lighter supplies of yellow potatoes are pushing prices slightly higher. Red and yellow are available out of Washington, Idaho, California, North Dakota and Florida. White potatoes are available in California and Florida. Mt Vernon, WA will finish for the season at the end of this month with new crop available late August. Quality is best out of Florida at this time.

Squash supply coming from South Florida is very good on both colors. Quality is good on zucchini, and only fair on yellow, south Florida has been receiving heavy winds causing a lot of scaring and discoloration. We expect production to be steady for the week and then transition to Central Florida the following week.

Good supplies on both Italian and Yellow S/N squash crossing through Nogales, AZ this week from Sinaloa, MX. Good volume currently being harvested from this growing region on both Italian and Yellow S/N and should continue through the week with good growing temperature expected moving forward. Both #1and #2 quality being packed on both varieties. Market has softened on both varieties as production has increased. Quality on both packs on Italian is good. Quality on yellow s/n is also good. Soft squash crop from Sonora, MX is expected to start as soon as next week.

Chilean stone fruit supplies remain consistent but limited on size. We expect steady arrivals of larger size peaches, nectarines, and plums for the next 2-3 weeks, then we expect supplies to taper off as we approach late April. Quality of the fruit has been very good. Demand has been steady. Market prices have been flat with very slight fluctuations on particular sizes. We expect to see early season harvest start in California by early May. Apricots will start first, followed by peaches and nectarines shortly after.

Transitions:
California harvest will start in early May

Peak Seasons:
We are moving past peak production and will see supplies slowly taper off as we approach mid to late April.

Florida has broke ground harvesting in Ruskin helping supply in a light way. Demand remains high enough to show no real change in the market this week as a result of fewer imports crossing the southern border from Mexico. Warmer weather is helping to improve round sizes with the best value to be found in 6x7, medium fruit. Roma tomatoes remain in high demand as well and hovering near the low $20's in FOB's, depending on label and quality. Grape and cherry tomatoes are in good supply and with warm weather in the forecast, markets are expected to ease off the closer we get to April and new crops come into increasing supplies.

Mexico farms are at the end of their crops in Sinaloa resulting in a stronger national market rising prices for the US at AZ and TX crossings. Mexico farms in Culiacan have had to endure several cold rain systems amidst crops transitioning between winter and spring acreage slowing the rate of crossings into the US, resulting in significantly higher prices. As typical for March, the small spike in pricing is expected to subside the further into March farms progress as new programs begin in Sonora. Grape tomatoes are in good production and widely available offering further value but may begin to strengthen as well as a result of farms realizing their seasonal decline. With mostly dry and warm weather conditions returning this week, markets may continue to rise in the short term and then improve the second half of the month as supply is restored through McAllen and Nogales facilities.