The Source - April 1, 2020

Retail markets seemed to have cooled this week (vs. previous weeks), while foodservice remains depressed with most states extending their ‘shelter in place’ time frame. Even though retail continues to see better movement than its foodservice counterpart, things have slowed this week due, in part, to logistical challenges and a suppressed labor force. Markets should level out with good availability on all apples with the exception of domestic Honeycrisp.

Production remains unchanged this week and should remain this way for about another week from both regions in Mexico (San Luis/Caborca). Quality also remains good, we will start seeing some seeding in the tips as the weather warms up. The retail market is less active this week with all the distribution channels filled up. The foodservice market is still very slow with many businesses being closed.

Forecast this week for Ventura County calls for temps in the mid to upper 60's. There is a possibility of some rain over the weekend and the front part of next week. With Mexico falling short on #1 grade fruit, suppliers will lean on California for #1 fruit. The majority of the volume is staying on the west but we do expect to see California fruit slowly filter its way across the US. With that said, we will see more volume hit the pipeline by next week which is a concern now that demand has tapered off. Market to remain strong into April.

The market has come off this week. We are seeing the size curve shift slightly from 60's and smaller to now 48's and larger. Also, we are seeing the market pricing start to decline by a few dollars. This seems to be due to overall demand start to slow down on the retail side. Currently, we are seeing #1 grade fruit tighten up. The trees just continue to produce an excess amount of #2 fruit. The USDA has not posted a current daily movement report. That being said, it is difficult to gauge and give an accurate percentage of arrivals into the US from Mexico. As of this week, growers continue to demand higher field prices. The market will remain active into April. There will be no harvest in Mexico the week of April 5th (Holy Week) followed by the Cinco De Mayo pull.

Green Bell Peppers- Good supplies of Green bell pepper are crossing through Nogales. Both retail and foodservice grade are available this week on all sizes. Green bell peppers are currently being harvested in the Mexican states of Sonora and Sinaloa. The green bell pepper crop from Sinaloa is expected to finish within the week. With lighter demand this week on green bell pepper, the market has decreased. Quality and shelf life currently range depending on the harvesting district. Supplies are expected to meet demand as one Mexican district ends and a new district starts.

Red Bell Peppers- Good supplies of Red bell pepper crossing through Nogales to start the week. Both la rouge and hothouse variety continue to be harvested. With lighter demand on both retail and foodservice orders, the red bell pepper market has decreased this week. Red bell supplies are expected to remain steady this week. Quality on Mexican red bell pepper range from fair to good. Good supplies of red bell pepper are also available to load in McAllen, TX.

Yellow Bell Peppers- Steady supplies of Yellow bell pepper are being harvested from Mexico this week. The market on yellow bell pepper continues steady this week. Quality on yellow bell pepper crossing through Nogales continues to be fair to good. Light supplies of yellow bell pepper are also crossing through McAllen, Texas.

Blackberry supplies remain limited but steady. We have both Mexican and California fruit available. California harvest is slow due to the cooler weather, but we should see improvements with the warmer temps over the next several days. Retail demand is still very strong and it's keeping the market prices firm. Quality is good and we expect to see improvements in supply and better prices as we move forward.

Alerts:
Supplies remain limited but steady. Markets are firm this week.

Blueberry supplies are increasing as new regions are starting up, but market prices have remained firm this week. The import season is winding down with limited availability of Chilean and Peruvian fruit left in the market. However, domestic production is ramping up with new harvest in Florida and Georgia. The weather has been ideal in these growing regions and we expect to see increased production for the next 4 weeks. California has been slow to start due to cooler weather, but with the warmer temps expected this week, we may see some incremental increases in harvest. Mexico is also expected to pick up production over the next several weeks. Although the drastic increases have yet to fully impact the supply flow, we do expect things to improve consistently as we move forward. We expect markets to remain steady this week and possibly see some more aggressive prices later in the month (barring any weather events).

Alerts:
Supplies are steady and markets are firm this week, but we expect better production and sharper prices as we move through April.

Transitions:
Import season is finishing. Florida, Georgia and California are just starting. Mexico continues to be steady.

Not much change on raspberry supplies this week. We have several areas in production. Mexico continues with good production, Baja is increasing production and California fruit is ramping up. Quality is strong and demand is steady. Due to the increased production, we are seeing a decrease in market price with some aggressive deals being offered on volume. We expect supplies to remain strong through next week.

Alerts:
Good supplies with promotional opportunities available.

We have several growing regions in play at the moment. Some are finishing and others are just starting. Florida is now done with production. Mexico is phasing out with little fruit remaining out of McAllen. Quality on the last of the Mexican product is fair, but prices are a little sharper. Oxnard continues to have regular production and numbers are climbing. Santa Maris is gradually picking up pace, but still limited. Salinas / Watsonville has not yet started, but we expect the first harvest to get going by the weekend and slowly build momentum. Most of the fruit is coming out of the Oxnard area and that is where our main FOB point is at this time. We did see some light rain over the last 2 weeks. This will have some residual effect on quality this week. We can expect to see soft spots and occasional bruising. However, the weather is expected to be clear for several days, so quality should improve and production should increase. Retail demand is still very strong, so many shippers are holding market prices firm. However, with temps reaching in the low 70's, we may see a wave of product come on. If so, we may see some more aggressive prices going into the weekend and into the front part of next week. We will monitor the supply and market conditions closely and keep you updated.

Alerts:
Oxnard is the main production region currently. Supplies are consistent. Demand is still very strong. Markets are slightly lower.

Transitions:
Santa Maria is slowly ramping up. Salinas / Watsonville will get started this week and ramp up slowly through the month.

The broccoli market continues to adjust lower as we move through transition from Yuma to the Salinas Valley. Quality continues to have slight purpling caused by the recent cold weather, some mechanical damage, and occasional yellow cast. Look for Broccoli to continue to adjust as supplies pick up in the Salinas Valley.

The brussels sprouts market has started coming off as more supply has hit the pipeline. Currently, quality is good with occasional internal decay. Look for the Brussels sprouts market to continue to adjust lower going into next week.

Raw carrot supplies remain steady, but vendors have had a difficult time keeping up with the processed carrot packs. This is not an issue of low supply, but rather production capacities. With the wave of increased processed carrot demand, shippers simply do not have the manpower or hours to produce enough finished goods to satisfy the needs. Last week was a bit of a surprise to the industry, so we saw shippers struggle more so than this week. However, this week, vendors have made appropriate changes to production schedules and machinery to increase production numbers. Although demand still surpasses production, we are seeing improved supplies of processed goods. This will continue to improve as we move forward and shippers adjust to the new demand curve.

Alerts:
Processed carrot packs are improving in production volume.

The cauliflower market has recently come off with product coming on in the Salinas Valley. Yields have picked up with most shippers given the improvement in weather the last couple weeks and with demand falling off. The quality is good with slight bruising and yellow cast with weights in the 25 to 28-pound level. Look for the market to continue to adjust going into next week as we make our way through transition.

This market has softened as demand for retail business has fallen off. Supplies are ample to fill all orders currently. Mexico has light production. Santa Maria and Oxnard are the two main growing regions for this commodity. With demand off on the foodservice sector, orders are being filled in full. Heavy rains causing extremely muddy conditions this past week had slowed production in southern California but with no rain expected this week. Expect good supplies throughout the week. The quality continues to be above average with most shippers. The weights per carton are averaging 57-60 pounds.

Jalapeno- Good supplies of Jalapeno are crossing through Nogales, AZ this week. Good supplies are expected to continue throughout the week. New crop Jalapeno quality from Mexico is good. The Jalapeno market is lower/steady this week. Jalapenos from Mexico are also available to load in McAllen, Texas.

Pasilla- Good supplies of pasilla available through Nogales, MX. Good supplies are expected to continue. Pasilla's quality from Mexico crossing through Nogales is good. The Pasilla market is steady this week. Pasilla from Mexico is also available to load in McAllen, Texas.

Anaheim- Good supplies of Anaheim crossing through Nogales this week. Quality on Anaheim crossing through Nogales is good. Size on the pepper is mostly medium to large. The Anaheim market is steady in the mid-teens. Anaheim from Mexico is also available to load in McAllen, Texas.

Serrano – Moderate supplies of Serrano peppers continue to be available to load in Nogales, Mexico. Serrano supplies are expected to remain steady throughout the week. Moderate serrano supplies are also crossing through McAllen, Texas.

Tomatillo – There are good supplies on both husk and peeled tomatillo. New crop on both husk and peeled are being harvested in Sonora. Quality is good for both varieties. The market on both varieties have decreased this week.

The cilantro market continues to be leveled off as there have been plenty of supplies. The cilantro quality is good with an occasional yellow leaf. Look for the cilantro market to adjust going into next week with the rainy weather we are having this week.

Lemon supplies overall out of both districts are looking good on supplies with demand backing off. Lemons out of the Central Valley continue to look really nice on supplies and quality. Sizes on 165’s and larger markets are staying steady this week. The Coastal Region supplies are packing out heavier numbers and peaking on 115/140/95’s. Out of the CA Desert/AZ Desert Region, Yuma has concluded for the season. Supplies are winding down out of the Mecca/Thermal area. Please reach out for any advance pricing.

The lime market has backed off this week, and we are expected to have steady supplies going into “Holy Week”. Starting next Monday, 4/6 harvest crews in Mexico will conclude working until the following Monday. Suppliers are doing their best to load coolers with fresh fruit to avoid any shortages. It is advised to place orders in advance starting at the end of this week to help with better coverage. Let us know what we can do to help service your lime needs. We have opportunities to load FOB Texas and California as well as delivered options. Please reach out if you have any interest.

Orange supplies this week are in much better shape than compared to last week. The high spike in retail demand has backed off and there is no rain in the forecast until Saturday, which is expected to be light. Supplies are back, the markets are starting to settle and movement is slowing down to a normal rate. We may see another surge of business as suppliers anticipate most will only shop once per week and buy more each trip. They are ready to harvest daily to keep up with all needs. Fruit quality remains great with consistent brix levels and traveling with minimal arrival issues. On specialty citrus, Mandarins continues to be a preference in choice, with steady supplies peaking on 40s and smaller. Continue pushing Cara’s, Bloods, and Gold Nuggets. Texas grapefruit is winding down for the season and California is ramping up. We’re seeing nice quality and steady supplies.

Good supplies of cucumber are crossing through Nogales from Sonora, Mexico this week. All pack styles and sizes are being packed and are available this week. The cucumber market has decreased this week due to better supplies and lighter demand. With good weather in the Sonora growing district, the cucumber supplies are expected to increase in the upcoming weeks. Quality on cucumbers from this growing district is good.

Eggplant supplies continue steadily this week. Eggplant crossing through Nogales, AZ continues to be harvested in Sinaloa. Supplies from Sinaloa continue to be packed in all pack styles and in all sizes. Quality on eggplant crossing through Nogales varies from fair to good as eggplant crop is reaching the end. The eggplant market has decreased this week due to lighter demand.

Green grape supplies are limited. Availability will continue to be a challenge through transition. We expect Mexico to get started in the next 2-3 weeks with limited production. What shippers are utilizing at this point is storage fruit from Peru and Chile. Retail demand is still very strong and suppliers are trying to hold onto the little fruit remaining to cover contracts and pre-commitments. As a result, market prices continue to climb and availability is spotty. Quality on the storage fruit is good with reports of darker color and occasional soft berries. We will watch the quality closely as we move forward.

Alerts:
Storage fruit is limited and markets are climbing. This will be the case until we transition into Mexico. Quality is good with darker color.

Transitions:
We expect Mexico to start in the next 2-3 week.

Supplies of import red grapes remain steady on both coasts. All fruit is still product of Chile or Peru. Most shippers are now working off of storage fruit, but we anticipate having plenty of inventory to carry us through the transition period for the next 2-3 weeks. Quality is good with occasional soft berries. Markets remain flat this week, after a small increase last week. Retail demand is still strong and shippers are not in a hurry to move fruit. We expect Mexico to get started in a light way in 2 weeks. Then slowly ramp up as we move toward the end of April.

Alerts:
Steady supplies and markets. We are into storage fruit, so we will watch quality closely.

Transitions:
We are currently in transition. We expect Mexico to start in the next 2-3 weeks.

The green onion market continues to stay steady with good supplies brought on by the warmer weather we've had in Mexico. Quality is good with occasional leaf minor caused by the recent cold and wet weather. The market will continue to stay steady going into next week.

The kale market continues to stay steady. Quality continues to improve with full bunches and some yellow leaves being reported. We're hoping this week's warmer weather after these rains continue to help the quality, supplies, and spur growth.

Foodservice activity is almost non-existent and retail business has fallen off immensely. This market is steady to lower and some suppliers are offering PAS pricing due to overages in inventories. Supplies clearly exceed demand. The weather in Yuma will be in the low-mid eighties all week and in southern California expect mid-seventies with no rain in the forecast. Huron and Salinas are expected to be dry for the week as well. The overall quality is fair. The biggest issue has been mildew on the outer heads of lettuce. Shippers are trying to clean up as much as possible. Discoloration and misshapen heads have also been reported as well. Salinas will have light production by the middle of this week.

Transitions:
Salinas will begin production by the middle of this week.

The Tender Leaf supplies continue to stay steady during this transition period. With the rains behind us, we anticipate supplies, quality, and growth to continue to improve. Quality lately has been good with occasional yellowing and bruising of the tender leaves.

On the melon front, retail demand has come to a complete halt for both east and west coasts. During these difficult times, there seems to be a handle full of items that are hot commodities and in high demand. That being said, demand is extremely light for offshore melons. Pricing continues to decrease and the market is expected to remain lower for the month of April. We can expect aggressive pricing, opportunity buys and maybe even PAS options in the coming weeks. Domestic season will ramp up late April, early May.

Watermelon supplies crossing through Nogales, AZ is being harvested in Nayarit, MX, and Sonora, MX. Watermelon supplies are steady from both districts. Both bins and cartons are currently being packed. Quality from this growing district varies from fair to good. The watermelon market is currently steady.

Overall markets are on a downward trend as supplies remain plentiful in Northwest regions of Washington, Oregon, and Idaho. Retail demand remains active keeping medium sizes in lighter supplies and higher markets. All other sizes are showing lower markets as the Northwest looks to finish up the season prior to California desert and Texas domestic supplies starting in the next 3-4 weeks. Expect to see low markets over the next several weeks with the exception of medium sizes as long as retail demand remains active.

Alerts:
Markets lower with exception of medium sizes; retail demand active.

Transitions:
California desert and Texas domestic to start mid April.

D’Anjou and Bosc pear movement remain steady to lackluster due to the lack of foodservice volume and retailers reducing the amount of SKU’s because of labor shortages. The state of Washington has experienced a 30% reduction in overall yields this season (vs. last season) and the current, depressed demand is not as impactful as one may think. Markets remain stable with plenty of fruit available.

Pineapple supplies are looking good out of all loading locations and markets remain steady. Quality remains excellent with minimal arrival issues. We haven’t received many reports on the fruit being held up at the ports, they are consistently available. Please keep the orders coming and run all offers by us. Our suppliers have opportunities to push extra volume and we will make sure to get you covered.

Consumer bags along with carton 90 count and smaller remain in high demand with the current retail surge across the nation. Retail demand has slowed but remains active with consumer bags extremely scarce. Larger size 40 count through 80 count markets have shown decreases in pricing over the last couple of weeks due to light demand. As we head into this week and next we will see a continued downward market trend on larger size cartons with active consumer bag pricing. Washington, Colorado, and Wisconsin will follow Idaho markets with a push to move carton product due to the lack of foodservice demand. Lots will continue to show occasional peepers, soft rot, shoulder/internal bruising.

Alerts:
Retail demand driving markets on consumer bags and smaller size potatoes

Retail demand continues to drive prices higher in all regions. Washington is finishing up for the season with minimal supplies and rising markets. This includes Mt Vernon, Washington that suppliers in Bakersfield, CA were using to source product and fill mixer orders. California's local supplies are expected to start mid-to-late April with volume by May. North Dakota continues to produce light supplies of red and yellow. The main sources for current color potato supplies are Idaho and Southern Florida. Expect Idaho to finish up mid-April which will also be the same time frame we transition from Southern Florida to Northern Florida. Markets will remain active with light supplies over the next 3-4 weeks.

Alerts:
Markets continue to rise with active demand.

Transitions:
Bakersfield, CA and Northern Florida to begin mid-to-late April.

Good supplies on both Italian and Yellow S/N squash are being harvested this week and are available to load from Nogales. New crop of soft squash is currently being harvested in the Mexican state of Sonora. The soft squash market has decreased within the past week due to light demand on both retail and foodservice orders. All pack styles are currently being packed from this district. The quality of both Italian and Yellow S/N is currently good. Good weather in the growing region will increase production on all soft squash.

We are at the end of the import season. We will see availability, size options, and varieties phase out quickly. Nectarines have already become very limited. Most shippers are no longer quoting prices. Peaches are next, with limited availability being reported from all shippers. We expect peaches to finish up completely over the next week or so. Plums should last through the end of the month. We expect new California harvest to start by the end of April and ramp up midway through May.

Alerts:
Import season is done with very little fruit remaining. Nectarines are done, peaches will finish in a week or so and plums will phase out by the end of the month.

Transitions:
California harvest to start by the end of April and ramp up mid way through May.

It is a buyers’ market for Tomatoes. Spring crops are beginning to flourish while demand greatly pulls back amidst changes in consumer behavior. Quality is good and the abundance of tomatoes has reduced harvest to packing per orders, leaving excess in the fields. Roma production is steady and light. FOBs have adjusted to seasonal lows and quality is good. Grape and cherry tomatoes are also widely available reducing the market to minimums and quality is good.

Western Mexico has begun harvesting spring crops in the north, adding to harvest that has been ongoing in the south. Production is well in excess of U.S. demand and the market has reached the mandated minimum for all items. There is plenty of product available across all categories. There has been a wide concern since September over the newly imposed Suspension Agreement Inspections set to start this month disrupting the flow of imports into the U.S. At least, for now, the current lackluster demand will greatly lighten the load for new inspectors providing more time to acclimate to the new standard.