The Source - June 12, 2019

Eastern Region:
Many shippers continue to clean out their remaining inventory with not much ‘load volume’ opportunities available. Most have transitioned to stone fruit, imports, etc. Prices have softened with deals available on small quantities of assorted varieties, sizes, and grades. Most of the demand has shifted to the northwest.

Washington:
Smaller fruit (125ct and smaller) continues to be a bit snugger compared to larger fruit. Some retail demand has eased with their transition to stone fruit, cherries, etc. With schools closed—or in the process of closing—for the summer, demand has definitely slowed for many growers/shippers.

There are ‘spot deals’ to be had on bigger fruit (100ct and larger), along with the occasional foodservice size (125ct and smaller), so please continue to look for ‘Spot Buy’ emails or let us know what you are looking for and we will find it.

California (FOB-L.A.):
Chilean Granny Smith – 80ct XFCY (available now)
Chilean Braeburn – 70-90ct XFCY (available now)
Chilean Pink Lady – 70-90ct XFCY (available now)
*Fresh harvest

When possible, send Apple/Pear orders earlier rather than later. The more time shippers have to pack product—before load dates—the better chance we have of receiving the requested product. It is essential that some size/grade/variety substitutions be allowed (especially on smaller sizes).

Central Mexico (Guanajuato) has better volume this week, and this trend should continue through the middle of August as long as the weather holds up. Volume on the bigger sizes out of this region still remains limited. Domestic volumes from all growing regions remain steady. Peruvian volumes remain unchanged from both growing regions, North, and South. Bigger sizing from all regions in Peru is low due to seasonality, and weather. Markets on both coasts are lower overall due to all regions having good volume.

Strong demand on the west coast for California fruit. Excellent quality as fruit is cutting great, eats well and good shelf life. Pricing remains in step with Mexican market. Despite the Peruvian arrivals and California fruit in the market, US inventory levels, in general, are low. With the recent increase in production, California crop could be wiped out by the end of July. Peruvian fruit will be on the market into August.

Weather in Michoacan Mexico is sunny and temps in the 80's for the next few days. There is some rain in the forecast for the end of the week. That could set back the harvest on an already tight market. Field prices continue to rise and we are hearing of fruit hitting the $70 range. We are on track to reach all-time highs in costs this week. Mexican harvest and crossings have been lighter the last few weeks. Number 2 grade, and larger sized fruit are making up most of the pack outs. New crop fruit is expected to start up early July but there is talk about Mexico holding off on the harvest of the new crop until mid-July.

Bell pepper supply is coming from Georgia with South Carolina starting light supplies. Georgia is the big player in bell pepper production this time of year, South Carolina has a couple of large shippers but total acreage is small. The Georgia pepper crop has been hurt due to very hot weather, a lot of pepper has not been packed because of sun scold and a high percentage has turned suntan reducing the amount of green choice or number 1 pepper. North Carolina is about a week away from starting their season, like South Carolina there is a small number of shippers but they have big volume.

Alerts:
Supply has been reduced due to extreme heat.

Peak Seasons:
This is peak bell pepper season in Georgia.

Green Bell Pepper- Good supplies of green bell pepper being harvested in Thermal, CA. Both retail and choice grade continue to be packed. Quality of green bell pepper from this district remains good. Green bell pepper supply currently meets demand. Market on retail and choice grade has risen slightly to steady. Green bell pepper harvest has also started in Fresno, CA with mostly large retail size.
Red Bell Pepper- Light supplies of Red bell pepper continue to arrive in Nogales from Mexico this week. The quality from Mexico is fair to good. Mostly choice grade being packed from this district. The market on red bell pepper has maintained in the high teens as red bell production continues in Thermal, CA. More retail grade than choice grade on domestic product. Domestic quality is good. Steady production expected in Thermal through the week. Light supplies of red hot-house bell pepper continue to be harvested in Baja California.
Yellow Bell Pepper- Light supplies of Yellow Bell pepper continue to arrive in Nogales this week from Mexico. The hothouse crossing through Nogales is mostly being packed in choice grade. Yellow bell pepper supply meet demand. Market on yellow bell is higher/steady. Yellow bell pepper continues to be harvested in the Coachella Valley this week where production is expected to be steady through the week.

Blackberries are coming primarily out of the new crop in central California with some product also being grown in Georgia. The quality has been good out of California. The Georgia product has struggled with some weather issues but still remains fair. The market remains firm and with the absence of the Mexican product will continue to stay that way.

Blueberries are in abundant supplies in California, Georgia, and North Carolina. Quality has been good in all regions. The market remains soft as the various regions vie for market share. Look for this market to remain this way for a while as we wait for Oregon and Washington to begin as well within three weeks time.

Peak Seasons:
The Central Coast is peaking for the next few weeks

Raspberries are in adequate supplies out West in the Central Coast. Quality has been good however we have just received a heat wave which could affect the fruit negatively. Look for possible defects like soft fruit, bruising and leakers to show themselves in the upcoming days. the market remains firm and this trend should follow through the end of the week.

The current heat we are experiencing has caused the yields for the front end of this week to drop substantially. Some shippers are reporting that they are losing approximately 30% of the daily estimated harvest. At this point, they are not seeing any extensive damage to the green/white fruit or blooms which is a good thing. Most of what is being thrown down is red hanging fruit that has been affected by the heat and will not travel. Shippers are working diligently to produce the best possible pack but with back to back days of over 100-degree weather we are sure to see heat-related issues. Be advised you will see a higher percentage of bruising, overripe and the occasional leaker. These conditions exist in both growing areas. Markets look to be steady and firm moving into the weekend with very little open market fruit available.

Alerts:
Record setting heat wave in the growing regions is causing reduced yields , higher markets and quality issues.

The broccoli market has leveled out as there continues to be a steady supply in the pipeline. The gaps we've experienced recently have closed a bit in Salinas. The recent heat wave in the Salinas Valley may affect supplies to be less available going into next week. Quality is good with slight purpling, some mechanical damage, and occasional yellow cast.

The Brussels Sprout market continues to come off as rain gaps are closing and with a little more supply in the pipeline. The recent warm weather has brought on yields. 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 continue to adjust 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.

The cauliflower market continues to be low with good yields coming out of the fields. Supplies have been consistent recently but the recent heat wave in the Salinas Valley may cause yields to lower. Overall, the quality is good with minor 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.

This market is firm with multiple suppliers. There are a few shippers that have come off slightly. Overall, demand is steady and supplies are moderate to light. Salinas will begin production this week and more shippers will come on the following week. This coupled with schools out should allow the market to be softer in about one to two weeks. Production in Santa Maria and Oxnard has been getting stronger compared to past weeks. Production in Mexico continues to be on the light side due to inconsistent weather patterns. Some common issues continue such as seeder, leafy tops and mechanical.

Transitions:
Salinas has begun production in a light way.

The California season is, for the most part, done. Excessive rains have all but wiped out this season’s crop and what minimal volume shippers are able to salvage is being used for previous commitments.

This week, the state of Washington started in a light way. We will see volume begin to increase toward the end of the week and peak between the 19th and 21st of June. Quality is excellent and should remain with warmer temps and no rain for the foreseeable future.

Export volumes, to the Pacific Rim countries, are in full swing and demand is strong.

Alerts:
Washington has started harvest this week, but in a very light way. We should see more product become available by next week.

Jalapenos- Moderate supply of Jalapeno still available to load in Nogales, AZ from Mexico. Jalapeno is being harvested from the Mexican state of Sonora where the quality is fair. Mostly medium to large size are available from the Sonora region. Market on jalapeno has maintained in the mid-teens. Jalapenos from Mexico are also available to load in McAllen, Texas.

Pasilla- Light supply of Pasilla peppers available to load in Nogales, AZ from Sonora, Mexico. Pasilla from Sonora is expected to finish this week. Quality on Pasilla from Sonora is mostly Fair. Size on the pepper is mostly medium. Market on Pasilla is higher/steady. Pasilla pepper also being harvested in Baja California. Quality from Baja is good. Pasilla from Mexico also available to load in McAllen, Texas.

Anaheim- Moderate supply of Anaheim available to load from Baja California. Quality from Baja is mostly good. The market for Anaheim is in the mid-teens and is expected to stay there through the week. Anaheim from Mexico also available to load in McAllen, Texas.

Serrano – Moderate supplies of Serrano peppers available to load in Los Angeles, from Mexico. Supplies are expected to remain steady throughout the week. Supplies currently meet demand. Price on Serrano pepper is currently in the high teens and is expected to remain the same through the week. Serrano supplies also crossing through McAllen, Texas.

Tomatillo – Husk tomatillos are available to load in Los Angeles, from Mexico. Quality of husk variety is good. Good supplies on husk tomatillos are expected to continue through the week. The tomatillo market has increased slightly on both husked and peeled. Both Husked and Peeled tomatillos are increasing in the teens. Both varieties of tomatillos are also available to load in McAllen, TX.

The cilantro market has reacted to the recent heat wave and the market has gone up due to lower yields. The cilantro quality is good with an occasional yellow leaf. Look for the cilantro market to be volatile going into next week.

Lemon supplies continue to remain tight on 165’s and smaller. Market prices continue to climb weekly, looking at mid $30’s on choice and fancy fruit. Supplies continue to peak on the large sizes 75ct/95ct/115ct. Quality is looking decent with the warmer weather we’ve been experiencing in the Central Valley we’re getting reports of soft fruit, however, the interior looks great.

Limes supplies continue to improve weekly, we’re seeing more crossings from the border. Plenty of promotional opportunities coming up for 4th of July pull. Supplies continue to peak on the 175’s and smaller, with markets in the low teens to single digits. Supplies continue to remain light on large sizes 110’s – 150’s, markets in the high $20’s/low 30$’s.

Foodservice size 113’s and smaller will remain snug on Navels and Valencia’s. We have plenty of volume and opportunities on 88’s and larger. Markets on both varieties will be in the $14-$16 range depending on grade and size. On Specialty Citrus, the Delite Mandarins are starting to dwindle down on supplies. Bloods & Golden Nuggets will go through June, early July. Ojai Pixie Tangerines quality is looking great and the taste is excellent. Please reach out for pricing.

Cucumber supply is spread out from Georgia to North Carolina. Georgia supply is light and sporadic, hot weather throughout May has hurt the crop, some fields have been abandoned because of quality and lack of production. North Carolina is just getting started and production will not get into heavy volume until next week. Number 1 product is getting tighter with a higher percentage of product going in select cartons. There are smaller pockets of cucumbers popping up from Virginia to New Jersey but the volume is light. New Jersey will have some volume by the 4th of July, most of the other areas are smaller local deals. Quality is generally good but it does vary from farm to farm, Georgia has been getting rain for the first time in about a month, some areas have gotten significant accumulations.

Transitions:
cucumbers are in transition to North Carolina.

Light supplies of cucumbers continuing to cross through Nogales, AZ from Sonora, MX. Mostly plain being packed. Cucumber volume continues to be low from Sonora due to the sluggish cucumber market, but quality continues to be good. The cucumber market is increasing and could remain high due to crop from Sonora finishing up and cucumber crossing into McAllen is delayed. Mexican cucumbers are available to load in San Diego from the Baja growing district where the quality is also good.

Eggplant supply is coming from Georgia, Florida and South Carolina. Florida will finish this week, Georgia is in peak season and South Carolina is just starting. Georgia grows a high volume of eggplant and the quality is very good, South Carolina is just starting light volume but the state as a whole is not a big eggplant producer. Georgia will continue through the month of June with good volume of eggplant.

Peak Seasons:
Eggplant is in peak season

Light supplies of eggplant continue to arrive from the Mexican State of Sinaloa and are expected to finish the end of this week. More choice grade eggplant than fancy arriving from this district. Moderate supplies of eggplant also being harvested in Thermal, CA. Mostly 12ct and 16ct being packed. Eggplant supplies from Thermal are expected to increase. Eggplant market is currently high/steady due to limited supplies. Quality from Sinaloa is mostly fair. Eggplant quality from California is good.

Green grape supplies have been consistent with good availability in both production regions. Like the red grapes, California fruit is always more expensive than Mexican fruit. Coachella has excellent quality and plenty of availability, but the prices are steady and higher than in Mexico. Mexican production has ramped up with plenty of fruit available at much more aggressive prices. Quality is also been reported as strong. With the warmer weather in California, we expect to see more production in new regions over the next 3-4 weeks.

Red grapes are in good supply, but we continue to see a split market between Mexican and Domestic production. Because of the added costs of growing and harvesting in California, the market prices on domestic fruit is typically higher than Mexico. This year, we have been right on trend. California fruit is readily available and quality is excellent, but prices have been steady and higher than Mexico. Mexican production is steady with good volumes of all sizes of red grapes. Mexican markets are considerably cheaper with aggressive prices being offered on fruit in Nogales. The warmer weather will help promote growth in the central valley and we can expect to see additional domestic production come into play over the next 3-4 weeks.

Green Onions supply continues to be plentiful with the recent nice weather in Mexico and Salinas. The cooler weather in March is causing occasional leaf minor and mechanical damage. The green onion market will continue to stay steady going into next week.

The kale market remains steady as supplies remain plentiful. Quality is good with full bunches, and only an occasional yellow leaf being reported.

A planting gap has occurred with multiple suppliers both in Salinas as well as Santa Maria/ Oxnard. Many shippers were sold out of this commodity by the end of last week and expect light availability all this week. Demand exceeds supplies and this will continue for the week. Quality issues include bruising, big veins, puffiness, mechanical, misshapen heads and insect damage. Expect average quality for the week. The weights on liner product have been reported at 40-43 pounds.

The romaine market, as well as all leaf items, has firmed up in the marketplace. Supplies look to get tighter throughout the week. Currently, supplies are moderate at best. The weather in the growing regions have been warm and mildew will become an issue with romaine as well as green and red leaf and butter. The warm temperatures also contribute to insects latching on to plants. There have been reports to this already. There have been defects like mechanical and fringe burn as well. The weights on romaine are averaging 31-37 pounds while green and red leaf has been 20-24 pounds.

The Tender Leaf market continues to stay steady on spring mix, arugula, baby spinach, and cello spinach. Curly Parsley has reacted to the recent hot weather and has become much tighter due to lower yields caused by this recent heat wave. Quality is good with minimal yellowing and bruising of the tender leaves. Look for these items to be steady going into next week.

New crop desert fruit is in full swing. Weather has been consistent in the desert with temps ranging in the upper 90's to 100's. This is prime weather for growing melons. Good quality on LSL (Long Shelf Life) variety melons internally and externally. Small fruit remains limited for the next few weeks. There is good demand with a steady market. Mexico has pretty much finished up for the season and we are now seeing all domestic fruit. Overall numbers are down 26%.

Majority of the honeydews are import. Mexico has about 70% of the production and the balance is domestic. This will be the trend for the next few weeks but will switch to Domestic being the primary source. Mexico has old crop fruit currently going out of Hermosillo and new crop fruit is starting up out of Caborca. Weather in growing regions of Mexico and in Arizona regions are instep. Temps are in the upper 90's to 100's. Domestic production is ramping up but still seeing light offerings on small fruit. California will start up in July.

Good supplies of watermelon are still available to load in Nogales, AZ. Mostly 2/3 bins continue to be packed. Quality of watermelon crop from Sonora, MX is mostly fair to good. Good supplies of seedless watermelon continue to be available to load out of Nogales, AZ through the week. The seedless watermelon market remains low as summer demand continues to be light.

Onion markets are higher this week as rain in New Mexico curtailed harvests at the front end of the week and demand shifted to the California Valley. New Mexico continues to produce all three colors and will slowly ramp up in production this week as the weather will improve with highs in the mid-to-upper 90's. California Valley has had a slow start due to rain in May and will expect to be in full production by next week. California desert, for the most part, has finished and Uvalde, TX has limited supplies left with fair quality. Expect to see strong markets into next week as demand continues to be active and New Mexico recovers from the recent storm.

Pear market remains steady. Much like the apples, foodservice sizes (110ct and smaller) continue to be difficult to supply and are in few hands. GREEN BOSC PEARS ARE DONE and Green D’Anjou should be available through July but will require flexibility when subbing sizes.

Half carton Red Anjou pears are the prevalent pack – for most shippers – this time of year (30s through 55s) and are available through mid-July (approx.).

Chilean and Argentinean Bartlett pears are available and load in Los Angeles. Also, Chilean Packems (70-120ct) are available.

California Bartlett pears are expected to start the week of July 8 (specifically, the 10th-15th). Calif. Bosc is expected to start 3-4 weeks after CA Barts (week of Aug 5th or 12th).

Pineapples supplies are looking steady. Quality has been solid with a nice brix to add. As we head in June supplies looking to be good until last week supplies are looking to get snug until early September. This is due to yields coming on earlier than expected during the months of May and June. Markets remain steady $12-$14 depending on the size.

Markets on larger size Idaho Burbank's continue to inch up as supplies are lighter. Burbank profile for the remainder of the season will be heavier towards 80 counts and smaller so expect markets to continue to bump up on the larger 40-70 count sizes until new crop begins in August. Burbank quality is good with the exception of a few lots showing some shoulder bruise and occasional hollow heart. Washington, Colorado, and Wisconsin continue to run Norkotah's with steady to higher prices. Wisconsin quality remains fair.

Color potato markets remain active as overall supplies are lighter. Idaho is down to one supplier moving true Idaho color potatoes with a couple of others sourcing from California to supplement orders. California is producing all three colors out of Bakersfield and will transition into Stockton around mid-July and run through August. California markets continue to rise as demand shifts to this region. Eloy, AZ continues to produce red and yellow potatoes and will do so through the balance of June. Florida is winding down, especially on yellow potatoes. Expect sporadic sizing and colors for the remainder of the Florida crop. Texas is expected to begin early July along with some crops in North Carolina, Minnesota and Wisconsin will begin early August.

Squash supply is all over the southeast and mid-Atlantis states but no region has an overabundance of supply. Georgia is starting to wind down for the season with all the hot weather and now a weeks worth of rain, the production is dropping fast. The mid-Atlantic states are all producing but there is not a lot of planted acreage, New Jersey is starting to produce some volume but the region has been receiving cooler weather slowing growth of squash. After a very wet and cold spring, the mid-western states are behind schedule for harvest. Yellow squash supplies are very tight, zucchini squash is moving well and supply is a little tight but better than yellow.

Transitions:
Squash is in transition from Georgia up the coast as far north as New Jersey.

Both Italian and yellow straight-neck squash are being harvested in Santa Maria, Fresno, and Baja California. Better supplies on Italian squash than Yellow S/N from all three districts. Market on soft squash could increase due to hotter temperatures in the growing region. Quality from Santa Maria, Fresno, and Baja California is good on Italian squash
and fair on Yellow S/N.

Domestic stone fruit production is in full swing with promotable volumes available on peaches, nectarines, and apricots. Both tray pack and volume fill pack styles are available in all sizes. There are several varieties of white and yellow flesh fruit being harvested. Market prices have been steadily dropping in small steps week over week with aggressive opportunities on volume fill 60 and 70 series fruit. Quality has been excellent. Plum and pluot harvest have been slow but steady. Quality is excellent, but volumes are still light. Market prices have been steady. We expect to see increased availability over the next 2 weeks.

Peak Seasons:
We will be entering peak production on peaches and nectarines over the next 2 weeks and expect good supplies for the next 6-8 weeks.

Quincy and South Carolina have begun picking in a light way and volume are shrinking into next week. Sizing has been heavy to XL and Lg with little small fruit available. Naturally, sizing will begin to even out as harvest move to incorporate second picks by next week. Until then, heavy rains are anticipated over Northern Florida and South Carolina growing areas halting farm operations and preventing packing. As a result, the market is expected to continue upwards as supply is reduced further from the weather. Rounds are currently steady from last week and already feeling pressure upward as buyers try to get ahead of the rain. As expected, Roma tomatoes are very limited and are forecasted to remain so over the next 5 to 6 weeks through the Quincy season due to the limited acreage planted. After the 4th of July, a variety of regional programs in AL, AR, TN, etc. will spring up to offer relief to the scant supply. Quincy’s acreage is largely reserved for round plantings, however, grape tomatoes are in production. South Carolina has begun this week harvesting grape tomatoes to help the market and may help price slide a couple of dollars by mid-month. As the transition progresses to smaller programs in the North, western supply becomes more of a factor, however, it is yet to be determined how subtle or drastic the 17.56% Mexico duty set by the US Dept of Commerce for tomato imports, will affect the dynamic of the market in the weeks ahead.

Mexico tomato prices are steady from last week and firming up as supply contracts over the next 2 weeks. Nogales is finishing the remainder of their season while new crops in Eastern Mexico and Baja are underway and have begun to establish the western market in the US for the short term. The supply of round tomatoes in the west through June will mostly be Vine Ripe varieties with very limited domestic Mature Greens until California’s Central Valley breaks ground near July. Amidst economical penalties, there has been no significant change in prices from last week outside of the incremental influences occurring during the transition. Tomatoes remain in the low to mid double digits as typical for this time of year. Roma tomatoes have entered the $10 range of FOB prices as they become more difficult to source in the East. Mainland Mexico is slowly improving Grape tomato harvests while Baja continues to produce better quality. Duties are set at 17.56% of the value of tomatoes crossing into the US directly affecting the cost of goods. The added costs for importers will ultimately be reflected in what the consumer pays and is pressuring Mexico to keep prices low in order to continue the flow of tomatoes into the US. It is too soon to determine how both supply and demand will be affected, but it is expected that imports will be reduced at some point in the future.