The Source - August 15, 2018

Weather Update

High pressure strengthens out west with steady warming inland and continued marine layer influence along the coastal fields. Coastal regions will remain near seasonal temperatures with the warmer interior regions 5-10 degrees above normal into next week. Central Mexico will see more of the same with scattered showers likely across the region. To the north moisture from the Pacific continues to fuel showers and thunderstorms into Northern Mexico and the Southwestern desert locals. Florida will see slightly drier conditions this week with no tropical development forecast through the period.

Freight Update

California trucks are adequate and rates remain steady. Look for capacity to remain steady thru out the balance of the summer months. Washington apple truck supply is adequate as well. Idaho potato trucks remain steady as well. The national average on diesel remained steady this week and is currently at 3.217 per gallon. An increase of .619 from this time last year. California prices remained steady as well and are now at 3.942 per gallon. Crude oil dropped slightly this week and is currently at 66.08 per barrel.

Commodity Updates (Click row for summary) Expand All

Apples

Washington has started harvesting in a light way Gala and Ginger Gold apples. As we get into September, we will continue to see an influx of other varieties and increased supplies. California is currently harvesting gala apples with all size ranges. States such as Idaho, Michigan, New York, Pennsylvania, amongst other local areas have also started harvesting this week with increased availability moving forward. Quality is excellent from all growing regions with pressure tests in the 18 level and higher on new crop as well as good sugar levels. Sizing is still not determined, but initial reports are still showing heavier in the 56ct to 113ct sizes.

- Gabe Romero
Growing Region Market Quality
Wenatchee/Yakima, WA and Hood River, OR Steady/Higher Excellent
Hudson/Pleasant Valley/Red Hook, NY Steady Excellent
Stockton, CA Steady Excellent
Aspers/Gardners, PA Steady Excellent
Asparagus

The weather has improved in Central Mexico but due to seasonality volumes are way down. Their season should be wrapped up in the next 10-14 days depending on the weather next week. In Northern Baja, the weather has remained unchanged; volumes are about the same as last week. Production is lower this week in both regions in Peru due to cooler weather, and sluggish markets over the last three weeks, causing growers to close fields... Markets are up overall due to Central Mexico winding down, and weather in Peru.

- Tony Pinto
Growing Region Market Quality
Central Mexico Higher Good
Central Mexico Higher Fair
Northern Baja California Norte, Mexico Higher Good
Avocado (California)

California- Due to extreme heat a month ago volume continues to decline as we are winding down on the California crop. There is a strong demand for the California hass on all sizes, but there is just not enough to go around. California is tapering off and looks to be done at the end of August as we are transitioning into Mexican hass. Markets are in the 60 range and trending upward.
There is a strong supply on larger fruit out of Peru as they are peaking. Peru is providing relief as we are transitioning from California to new crop Mexico. We can expect a steady supply from Peru through mid-September. We are seeing reports of good quality out of Peru.

- Mike Magana
Growing Region Market Quality
Oxnard/Ventura, CA Higher Good
Avocado (Mexican)

Flora Loca crop out of Michoacan Mexico is starting strong with high field prices. For California, the crop is on a downward trend. Peru continues to provide relief and will maintain peak volume for the next few weeks. Flora Loca crop in Michoacan is showing more mid-size fruit (48s-60s). Markets are in the $60 range and still trending upward. We are fully in transition from old crop into Flora Loca crop. The industry continues to source mature fruit. Volume is not what it needs to be, and there are huge shortages. Loca crop will peak on 48s and smaller leaving a massive shortage on larger fruit (40s and larger). That being said Loca crop will peak out on 48s and smaller. The forecast in Mexico continues to call for scattered thunderstorms. Some areas could see limited harvest due to weather as Mexico is in the middle of their rainy season.

- Mike Magana
Growing Region Market Quality
Michoacan, Mexico Steady/Higher Good
Berries (Blackberries)

Supplies are good this week. We have seen an increase in harvest volume from the Salinas / Watsonville areas. Santa Maria has been lighter but consistent. We expect to see more fruit start to become available from the Baja growing regions over the next two weeks. Quality is being reported as excellent currently. Big berries with lots of flavor. Market prices have been steady to lower. As more supplies open up, we expect to see promotional opportunities over the next two weeks.

- Sean Azzelio

Transitions:
Baja will begin with light harvest over the next 2-3 weeks.

Growing Region Market Quality
Salinas, CA Lower/Steady Excellent
Watsonville, CA Lower/Steady Excellent
Santa Maria, CA Lower/Steady Excellent
Berries (Blueberries)

Supplies continue to be lighter this week. The Pacific Northwest and BC areas continue to produce, but quality has been a challenge due to the heat and yields have slowed down. Michigan harvest remains consistent, but they are transitioning through varieties and supplies are lighter. Quality is being reported as good; market prices are higher. New Jersey still has some light harvest this week of Pints; quality is good prices are firm. We expect to see some production start in Baja by the end of the month. This will overlap with the tail end of the Pacific Northwest season. Overall, supplies are lighter, demand is stronger, and prices are higher this week. This will be the situation until we get Baja going at the end of the month.

- Sean Azzelio

Transitions:
Baja harvest is expected to start at the end of the month and overlap with the Pacific Northwest.

Growing Region Market Quality
Oregon Higher Fair
Mossyrock, WA Higher Fair
Pitt Meadows, BC Higher Good
Michigan Higher Good
New Jersey Higher Good
Berries (Raspberries)

Supplies remain light but steady this week. No major changes in harvest or quality. Market prices have been consistent, and demand has increased slightly. As discussed last week, we do expect to see harvest start to decline over the next 2-4 weeks. We then hope to see a second peak in production by mid to late September in the California growing regions, before transitioning down to Baja and Mexico.

- Sean Azzelio
Growing Region Market Quality
Salinas, CA Steady Excellent
Watsonville, CA Steady Excellent
Santa Maria, CA Steady Excellent
Berries (Strawberries)

Supplies continue to be in good shape. However, the mood seems to have changed slightly this week amongst shippers. We do have a couple who are still aggressively pushing volume, but as a whole, it feels as though the markets are slightly firmer and shippers are not as desperate to blow through product. With the quality issues we have experienced over the last 2-3 weeks, shippers have really begun to crack down on their packing specs. With more clean fruit available on the plants, growers are extra critical as to what gets put in the box. This has to lead to decreased yields and less fruit being funneled through the markets. That being said, I do not see any drastic shifts in supply or price in the immediate future, but I do expect some shippers begin to pull back and start to firm up slightly. We expect quality to be better this week than last and continue to improve moving forward. All areas are getting ready for a transition in plantings / harvesting. Salinas and Watsonville will continue with consistent production and transition into fall harvest (new crop) over the next 3-4 weeks. Santa Maria is expected to start with their new fall harvest by the end of the month. Volume will be light and slowly build into September.

- Sean Azzelio

Transitions:
New harvest (fall crop) will being in Salinas, Watsonville and Santa Maria over the next 3-4 weeks.

Growing Region Market Quality
Salinas Valley, CA Steady Good
Watsonville, CA Steady Good
Santa Maria, CA Steady Fair
Broccoli

The broccoli market continues to be really active this week. The supplies out there and have become tighter with most shippers walking in sold out. Regional growing areas are short and winding down production as well. Mexico is short product due to quality issues from the heavy summer rains. Quality is fair with slight yellowing, some mechanical damage, and decent crown size. Look for the supply to start getting a bit better next week.

- Steve Cagle
Growing Region Market Quality
Celaya Guanjuato Mexico Higher Fair
Oxnard/Santa Maria, CA Higher Fair
Salinas Valley, CA Higher Fair
Brussels Sprouts

The current market on Brussels Sprouts continues to have leveled off. Supplies in Salinas continues to improve. Quality is much better from the previous weeks and is seeing less insect damage, black spotting and decay.

- Steve Cagle
Growing Region Market Quality
Salinas Valley, CA Steady Good
Carrots

Not much change this week on Carrots. The market and quality remain steady.

Jumbo size carrots should be in steady supply thru the season but demand is holding strong and so is the market on jumbos. Value-added packs and medium-sized supplies remain good.

Upcoming Season - Fall has a tentative start of 12/1/18 there are currently no signs of any shortages or gaps thru the Summer Bakersfield carrot season.

- Roni Sakay
Growing Region Market Quality
Bakersfield/Santa Maria, CA Steady Good
Cauliflower

Cauliflower market continues to be level with steady supplies from the Salinas and Santa Maria areas. Overall, the quality has been good. The quality reports have shown weights in the 25 to 31-pound level, little yellow cast to cream color, and occasional bruising.

- Steve Cagle
Growing Region Market Quality
Oxnard/Santa Maria, CA Steady Good
Salinas Valley, CA Steady Good
Celery

Good supplies continue to be the story with this commodity. The demand has picked up slightly, but there is plenty of production to fill all orders. Large sizing continues to be the most abundant sizing available. The temperatures continue to be very favorable for the growth of this commodity. There have been some reports of seeder, yellow leaves and slightly brittle but the overall quality continues to be strong, overall. The weight is ranging 58 to 64-pounds. Michigan production continues to be steady.

- Mike Pacheco
Growing Region Market Quality
Michigan Steady Good
Oxnard/Santa Maria, CA Steady Good
Salinas Valley, CA Steady Good
Cilantro

The Cilantro market continues to be tight due to the heat we normally find this time of year. The heat has burned up the product and stunted the growth and even started to shoot seeder stems instead of regular growth. This has resulted in much lower yields per acre than normal. Other growing areas across the country have also had to deal with weather, and that has hurt some of the local growing areas as well. Mexico growing areas have also experienced heat and rain which has lowered yields. It looks like the next two weeks will continue to be a challenge.

- Steve Cagle
Growing Region Market Quality
Baja, MX Higher Fair
Salinas, CA Higher Fair
Oxnard/Santa Maria, CA Higher Fair
Citrus (Lemons) Alert

Lemons supplies remain extremely limited with quality being fair at best. Arrivals showing decay, mold, and soft rot have been reported frequently. Offshore lemons have helped with supplies, although supplies are limited as well. The market for both domestic and offshore fruit is extremely active. We will see this trend through Mid October.

- Gabe Romero

Alerts:
Lemon supplies still remain extremely limited with elevated markets.

Growing Region Market Quality
Oxnard/Ventura, CA Higher Fair
Citrus (Limes)

We are seeing the same issues as the previous week. Weather in the Veracruz growing region is in the upper 80s to low 90s. Limes remain tight, and the market is active. Old crop is pretty much done, and we are seeing a limited amount of fruit as of now on this new crop. The rain that was expected a few months ago (May-June) never came. That being said we are now seeing a bit of a gap. Growers are predicting that we will see some relief come late August early September. Overall quality on the new crop fruit is fair to good. Larger fruit is limited (150s/175s) and smaller fruit (200s-250s) is what we are seeing for now.

- Mike Magana
Growing Region Market Quality
Veracruz, Mexico Steady/Higher Fair
Citrus (Oranges) Alert

We have seen a surge with the demand for small size oranges with the starting of schools across the country. This has created an upward trend in the market. Availability of small fruit is extremely limited with suppliers having to sub larger sized fruit to accommodate orders. Quality is still really nice with good sugar levels. We have seen an influx of regreening due to the high temperatures in the growing regions of California.

- Gabe Romero

Alerts:
Small size oranges are extremely limited with the market trending higher every week.

Growing Region Market Quality
Merced to Bakersfield, CA Higher Good
Riverside, CA Higher Good
Grapes (Green)

Green grapes continue to be plentiful as the California season rolls along. High temperatures have started causing some concern, but so far no issues have been reported. Typical issues associated with heat can include poor coloring, but with all California regions producing grapes, there are plenty of options available.

- Matt Connelly
Growing Region Market Quality
Arvin, CA Lower/Steady Excellent
Delano, CA Lower/Steady Excellent
Fresno, CA Lower/Steady Excellent
Grapes (Red)

The red grape market continues to be soft as the availability far outweighs the demand. Plenty of product and deals available as we hit the peak season for red grapes in California. The high temperatures have yet to cause any discoloration, but if the heat wave continues, we could start to see the color retreat from the fruit and back into the stems.

- Matt Connelly
Growing Region Market Quality
Arvin, CA Lower/Steady Excellent
Delano, CA Lower/Steady Excellent
Fresno, CA Lower/Steady Excellent
Green Onions

The market continues to be competitive. Sizing is still trending to the smaller sizing. With the hot weather in Mexico, quality has been improving overall, and the presence of thrip damage and leaf minor is minimal. The hot weather has also contributed to the labor shortage as the temperature has reached as high as 116 degrees. This hot weather is continuing to help fight off thrip and leaf minor presence but also keeps the green onions from growing. Green Onions will be snug for the next three weeks.

- Steve Cagle
Growing Region Market Quality
Mexicali, Baja Higher Good
Kale

The kale market continues to be steady with no signs of changing in the coming week. Supplies continue to be good with steady demand. Quality is good with good color, full bunches, and only an occasional yellow leaf being reported.

- Steve Cagle
Growing Region Market Quality
Salinas, CA Steady Good
Lettuce Iceberg

This market is extremely active. Demand exceeds supplies, and this will continue throughout the week. Suppliers have hit a gap in production. Common defects being reported to include puffiness, mechanical and some light weights. Depending on the supplier, weights have been ranging on palletized from 39-45 pounds. Whether you are north or south, production is light. Many shippers were sold out at the beginning of the week as they struggled to meet contract obligations. Expect escalated contract pricing by the middle of the week.

- Mike Pacheco
Growing Region Market Quality
Oxnard/Santa Maria, CA Higher Fair
Salinas Valley, CA Higher Fair
Lettuce Leaf

This market has remained unchanged. Shippers continue to flex on pricing for large volume orders. Romaine hearts are plentiful as well, and suppliers are very open to special pricing. Some romaine defects worth noting include fringe and tip burn as well as some insect damage. These defects will be seen on green and red leaf as well as butter. The culprit in this has been the warm temperatures in the growing regions. Expect heavy supplies to continue to be available all week. We are in the peak of the season.

- Mike Pacheco
Growing Region Market Quality
Oxnard/Santa Maria, CA Steady Fair
Salinas Valley, CA Steady Fair
Lettuce Tender Leaf

The warmer weather in the Salinas Valley has pulled a lot of the Tender leaf forward causing a gap. Supplies on spring mix, arugula, baby spinach, and cello spinach will all be affected. This warmer weather has caused some quality issues such as minimal yellowing, excessive moisture, or bruising of the tender leaves. This market will continue to be volatile for the next couple of weeks.

- Steve Cagle
Growing Region Market Quality
Salinas Valley, CA Higher Fair
Melon (Cantaloupe)

Supplies on smaller fruit are limited and will remain limited for the week. Growers are reporting a steady supply of large fruit (jumbo 6s, jumbo 9s, and 9s). We are already seeing shippers subbing into larger sized fruit to cover orders with a limited supply of small fruit (12s and 15s). With schools back in full swing, the demand for smaller fruit has grown. The weather has been ideal for the San Joaquin Valley growing region with reports of good to great quality on cantaloupes. Brix (sugar) levels are holding in the range of 12-16. Market prices are higher this week.

- Mike Magana
Growing Region Market Quality
Firebaugh, CA Steady/Higher Good
Mendota, CA Steady/Higher Good
Melon (Honeydew)

Supplies on smaller fruit( 6s, 7s, and 8s) are limited this week on honeydews with reports of a steady supply of larger fruit (jumbo4s, jumbo 5s, and 5s). For the week small fruit will be limited as we are already seeing shippers subbing orders into large size fruit. With schools back in full swing, the demand for small fruit is stronger. That being said the market price is higher this week. We are seeing good to great quality with brix (sugar) levels ranging from 10-14. The weather has been ideal for the San Joaquin Valley growing region.
Mixed Specialty melons- Growers are reporting that these will taper off at the end of the month out of the Huron area. We will see limited varieties available out of the Sacramento area. Overall quality is good with all varieties available.
-Crenshaw
-Casaba
-Juan Canary
-Santa Claus
-Orange Flesh
-Hami
-Galia


- Mike Magana
Growing Region Market Quality
Firebaugh, CA Steady/Higher Good
Mendota, CA Steady/Higher Good
Onions

Onion pricing on all colors and sizing remain steady. California and New Mexico are close to being done for the season. Idaho Washington, Michigan and New York have started new crop. Quality is good even with the heat the Northwest has been getting.

- Mike Gorczyca

Transitions:
California and New Mexico close to finishing up for the season with Washington and Idaho starting up

Growing Region Market Quality
Huron/Metler, CA Steady Good
Ontario, OR to Nampa, ID Steady Good
Quincy/Hermiston, WA Steady Good
Las Cruces, NM Steady Good
Pears

We have new crop Bartletts from Washington currently as well as the current California crop. The market is steady with deals for volume orders. Also, we have seen a full range of sizes from both growing regions. The quality from all growing regions is excellent with good pressure levels and decent sugar too.

- Gabe Romero
Growing Region Market Quality
Wenatchee/Yakima, WA and Hood River, OR Steady Excellent
Stockton, CA Steady Excellent
Pineapples

Current supplies are remaining consistent, although we are heading into the period where supply tightens up. Historically Pineapple supplies have tightened the end of July, but because of an influx of supply from the Philippines to the European markets, we have seen less stress on the South American supply lines. The markets should still tighten up, and prices rise in the next week or two until the end of September. Suppliers have expected markets to rise over the last few weeks, but we have yet to see that actually happen. If there are going to be more volatile markets coming up, expect to see them in September.

- Matt Connelly
Growing Region Market Quality
La Virgen, Costa Rica Steady Good
Heredia, Costa Rica Steady Good
Guapiles, Costa Rica Steady Good
Potatoes Alert

New Crop Harvest has is going in Washington and Idaho with Colorado, Wisconsin, and Minnesota to start the end of this week or the start of next week. New crop potato sizing is peaking on each end of the spectrum depending on field and growing location. Quality is great with light skinning showing up in a few packs. New crop market is decreasing as more volume become available. A few shippers in Idaho are still shipping storage Burbanks potatoes which will finish up at the start of next month.

- Mike Gorczyca

Alerts:
Idaho Burbanks will finish up the start of next week

Transitions:
All growing areas are transitioning to New Crop

Growing Region Market Quality
Hamer/Rupert, ID Steady Good
Quincy/Hermiston, WA Steady Good
Potatoes (colored)

Markets on Red potatoes out of all shipping points are unchanged with good supplies available out multiple shipping points. Quality is good. Gold and White markets will slowly trend downward as move grower come online. Reds and Golds are available in California, Idaho, Washington, Oregon, Minnesota, and Wisconsin. White potatoes are available in California, Wisconsin, North Carolina, and Virginia. Look for the markets to continue at current trends for the next couple of weeks.

- Mike Gorczyca

Transitions:
Color potato supplies transitioning to many different growing areas

Growing Region Market Quality
Stockton, CA Steady Excellent
Rupert to Rexburg, ID Steady Good
Mount Vernon, WA Steady Good
Pasco/Tri-Cities, WA Steady Excellent
Big Lake Minnesota Steady Good
Stone Fruit

Stone fruit continues to be plentiful in the valley. The warm weather is causing the fruit to size up, so there is very little small sized fruit to go around. Most shippers will ask to sub up a size, so make sure if you are pulling for school business, to make sure the shipper sends the correct piece count. Fruit quality is strong overall with good color. Prices are starting to firm up as the school demand increases.

- Matt Connelly
Growing Region Market Quality
Madera south to Arvin, CA Steady/Higher Good
Tomatoes (Eastern)

The market is slightly stronger from reduced yields. North Carolina will have a small crop to help the situation in the next 5 to 10 days. Alabama, North Carolina, Tennessee, and Virginia farms continue to struggle against rainy weather causing intermittent harvests and interrupted picking schedules, limiting the overall eastern supply. Arkansas has finished their tomato season also contributing to lesser supplies in the east. However, there is little change to price this week with heavy volumes continuing to ship from California. Helping to stabilize the eastern market, New Jersey, and Michigan farm operations are contributing to overall supply. Quality has diminished over the past couple of weeks as the effects of repeated rain interrupt farm operations. Repackers continue to produce quality pack outs, however, shrink is higher than normal and shelf life becomes a concern as more water sits in the fields. Round and Roma tomato availability is moderate helping to create firm price structure for the immediate future. Grape and cherry tomato volumes have also been reduced by weather but improving as harvest schedule begin to increase this week. Supply is snug helping to keep pricing elevated but should loosen up as the weather improves and fields dry out.

- Aaron Aliotti
Growing Region Market Quality
Exmore, VA Steady Good
Benton Harbor/Byron Center, MI Steady Good
Tomatoes (Western)

Despite low demand, prices have strengthened this week as eastern, and import tomatoes contract. As planned for this time of the season, Mexico imports through Baja slow down this time of year to transition growing areas, at a time when California harvests the peak of their season. Heavy volumes of tomatoes are in the market place, and pricing is starting to separate as quality and condition become a bigger concern for buyers, and extreme heat influences the integrity of the fruit. Round tomatoes are nearly half the price of eastern grown tomatoes amid a slight uptick in price this week with Romas following suit. Quality and sizing are inconsistent from triple-digit temperatures influencing the ripening of fruit on the vine causing farms to harvest select fruit prematurely. Less volume from Baja is helping to strengthen the market, but prices will soften in the next couple of weeks when new farm operations begin shipping again. Until then, expect a slightly stronger Roma and grape tomato market while volume is reduced. On California’s coast, new vine ripened operations have begun in Oceanside California where volume continues to build, helping to promote a competitive market further.

- Aaron Aliotti
Growing Region Market Quality
Southern San Joaquin Valley, CA Steady Fair
Northern Baja California Norte, Mexico Steady Good
Southern San Joaquin Valley, CA Steady Fair

Things You Should Know

Citrus (Lemons)
Lemon supplies still remain extremely limited with elevated markets.

Citrus (Oranges)
Small size oranges are extremely limited with the market trending higher every week.

Potatoes
Idaho Burbanks will finish up the start of next week

Transitions and Temperatures

Berries (Blackberries)
Baja will begin with light harvest over the next 2-3 weeks.

Berries (Blueberries)
Baja harvest is expected to start at the end of the month and overlap with the Pacific Northwest.

Berries (Strawberries)
New harvest (fall crop) will being in Salinas, Watsonville and Santa Maria over the next 3-4 weeks.

Onions
California and New Mexico close to finishing up for the season with Washington and Idaho starting up

Potatoes
All growing areas are transitioning to New Crop

Potatoes (colored)
Color potato supplies transitioning to many different growing areas

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