The Source - May 16, 2018

Washington Red and Red Varietal Apple market continues to strengthen due to good demand from export and supplies starting winding down on some of the Red Varietals. Red Del storage volumes continue to be down each year. Schools are starting to finishing which will take some demand off the smaller sizes. Granny Smith applies are still in a buyers market. Look for this to continue especially on the smaller sizes. Honeycrisp, Braeburn, and Jonagold will be the first to finish up for the season. Gold Delicious movement is steady to good with sizing peaking on Prem/Waxf #1 80-100s. Regional shippers Michigan and Pennsylvania are finished for the season which has put more pressure on Washington. New York has limited supplies of reds. The Gala market continues to be good. Fiji demand and markets are steady with sizing peaking on 88-100 counts. Quality on all flavors has been good with few reports of issues.

Ciudad Obregon, Mexico is starting to wind down due to seasonality, and very warm weather in the region. Gonzales, CA still has decent volume with their weather pattern remaining unchanged. Washington State will see better weather next week, which will increase production. Volume in both Ica, and Trujillo, Peru are about the same as last week and should continue to increase over the next two weeks. Airfreight from Peru has dropped a little bit with the Mothers Day flower rush finished, and should continue to drop over the next week. Markets on the east coast have come off, and the west should follow suit over the next week.

Transitions:
Central Mexico should begin harvesting in the next week to 10 days.

California production was steady at 13 million pounds last week and looks to stay at this level through the month before ramping back up early in June. Export demand remains strong. The crop is currently peaking on 48s & 60s. Fruit is ripening well and has good flavor.

Mexico's harvest volumes bounced up a little last week to 36 million pounds, but with the seasonal end of their normal crop approaching toward the end of May / mid-June, we anticipate levels to dip to around 20 to 25 million pounds through the month. Demand is strong, and we are still seeing tighter supply situation on 48s & 60s #1 fruit.

Green Bell Pepper supply is extremely tight, South Florida is winding down for the season, and central Florida is working on limited acreage. Plant City has been squeezed out over the past few years and cut back on planting bell pepper because of Georgia starting earlier year after year. This year a cool spring has Georgia starting two weeks behind schedule, creating a gap in supply. Georgia will start light supply early next week, but any volume is still two weeks away.

Alerts:
Extremely short supplies.

Transitions:
Bell Pepper is transitioning to central Florida.

Blackberry supplies are gradually increasing. Domestic harvest is still limited, so Mexico continues to be the primary source. However, shippers expecting Santa Maria to start ramping up over the next two weeks and Salinas / Watsonville to start by the beginning of June. Quality is good; berries are large with good flavor. Market prices have been fairly steady and will gradually adjust as volume increases. Georgia has now started with light volume. Quality is good, but price is higher. Supplies will improve in GA moving forward.

Supplies came to a sudden halt last week. Due to weather in Florida, their season ended abruptly. Georgia has had light harvest with on and off rain. California is very slow to get started with minimal harvest, and Mexico is winding down. All of this led to an industry-wide supply gap. Demand continues to far exceed supply this week as we wait for production to increase in California. Market prices have escalated, and coverage remains a challenge. That being said, the shortages are expected to be temporary. California growers are expecting supplies to increase rapidly over the next two weeks and North Carolina will begin harvest by the end of the month. Total production numbers are expected to ramp up and hit peak volumes by the first two weeks of June. New Jersey will start mid to late June.

Alerts:
Supplies continue to be very limited this week as we wait for California harvest to increase. Markets are higher.

Transitions:
North Carolina will start by the end of the month. New Jersey will start mid June.

Peak Seasons:
California is expected to reach peak volumes by the front part of June.

Supplies have started to improve as domestic production in California is gradually increasing. We continue to see an overlap with Mexican fruit being harvested consistently. Quality in both regions is being reported as good, and prices have started to decline slowly. Moving forward we expect to see domestic harvest continue to improve as Salinas and Watsonville areas begin early June. Market prices are expected to adjust down gradually as volume increases.

Transitions:
Salinas and Watsonville will start harvest early June.

Supplies continue to be excellent this week. Santa Maria, Salinas and Watsonville are in full production with good quality and heavy volumes. Oxnard is getting close to the end of the season. Most shippers have pulled out of fresh harvest and are using the remaining fruit for juice and processing. Any fruit being offered out of this area can expect to have marginal quality and should not travel far. To absorb the sudden onset of volume, Santa Maria growers have also dedicated a big portion of their fruit to processing this week. Although this will help, supplies continue to be heavy with plenty of good quality fruit to push. Aggressive prices and volume opportunities are available. Salinas and Watsonville production saw a boost last week as well. This week, harvest continues to be steady with good availability and good quality. Again, aggressive prices and volume opportunities are available. As we move past this wave of volume and post-holiday demand lull, we hope to see markets begin to normalize. Looking forward, all areas expect to have steady volume and good quality.

Alerts:
Supply exceeds demand this week. Plenty of good quality fruit with aggressive volume buy opportunities.

Peak Seasons:
We will see peak volumes continue in Santa Maria and Salinas for the next 3-4 weeks.

Broccoli supplies from all growing regions have been decreasing over the past couple weeks. This trend will last well into next week. The market is active with the most competitive prices coming out of Mexico. The overall quality is still good with minimal dehydration, yellowing, and minimal decay.

The brussels sprout market is trending higher. This is due to the volume out of Mexico is decreasing over the next couple months. Oxnard will not have the supplies to fill the void. We will see an upward trend in the market until supplies out of the Salinas Valley start in July. Quality is still really nice with minimal decay and a full range of sizes.

California carrot supplies are good on value-added packs and medium-size carrot. We are now seeing a better percentage of jumbo sizes coming out of the fields of the Coachella Valley.

Cauliflower supplies are increasing in both the Santa Maria and Salinas Valley growing regions. As a result, the market is trending lower. Quality has been nice through this small supply gap. We have seen minimal brown to black spotting, little to no cream color, and decent weights in the 26 to 29-pound level.

This market attempted to get stronger, but demand quickly fell off. Overall, this market is steady. Small sizing, thirty-six counts, in particular, are light in availability and command a higher price in the marketplace. The quality aside from some slight seeder and bowing is good with most shippers. Flexing is occurring with multiple suppliers. The best deals continue to be out of the Oxnard Santa Maria region. Orders loading in Salinas will require a transfer fee, contract or open market so please be aware.

The supplies of cilantro have been consistent. The market has stayed relatively competitive. We have seen arrivals with full bunches, minimal yellow to brown leaves, and little dehydration. This will trend into next week.

The Central Valley crop is near its seasonal end. The Ventura/Oxnard areas are becoming the main growing area. Demand is improving, especially on the smaller sizes of 162s/200s. These smaller sizes are beginning to sell out daily, and the market is firming.

Smaller size limes are ramping up quickly. Growers are sending big volumes of 200ct - 250ct fruit. Quality is good, and prices are declining gradually as production increases. The larger size limes (175 -110ct) are still lighter in supplies, and market prices remain higher. However, the weather looks to be good in the Veracruz growing regions and shippers are expecting increased supplies of all sizes moving forward.

The late varieties of navels and eating quality is some of the best of the season; we expect to see the larger sizes available into early June. Size structure is mostly large sizes 72s/56s/48s and very few of the small size fruit 113s/138s. California Valencia harvest has begun in a limited way. Growers are size picking for 72s and larger sizes that export uses, but we see some fall out of smaller sizes for domestic shipments. Availability continues to improve as Navel production winds down. Smaller size fruit of 113s/138s remain very limited.

Alerts:
Small size oranges, 113s/138s remain very limited.

The cucumber supply is lower than last week in Florida with light volume starting in Georgia. Rain in Florida and south Georgia has curtailed harvesting. There is also a wide range of quality in Florida; some product is light in color, all quality reports from Georgia are good. There is a good supply of selects in both states with super select supplies tight in both places. Expect supplies to vary with weather; there is rain forecast all week in the southeast which will slow production. We expect a big gap in pricing between Selects and Super Selects.

Alerts:
There is a wide range in quality of cucumbers in Florida and light volume starting in Georgia.

Transitions:
Cucumbers are starting to transition to Georgia.

There are new fields in central Florida with peak production being harvested now. Quality is very good, and the market is weaker. This is the best production Florida has had all season. Georgia is behind two weeks from their traditional harvest date. We expect ten more days of good production before supplies start to decline in central Florida and another three weeks before Georgia begins harvest.

Alerts:
Good supplies and good quality.

Peak Seasons:
Eggplant is in peak season

Green grapes are done out of Chile and will need to move to Mexican/Californian fruit. Mexico is in full swing, and there is plenty of fruit loading in Nogales, and most shippers have options to transfer to Harvest Sensations for an extra fee. Quality is being reported as excellent. California fruit is just starting out of Coachella and should be going full speed within the next week. Quality is reported as excellent.

There are a few red grapes available on the East Coast out of Chile, but Mexican fruit is crossing the border into Nogales regularly. Quality is reported as excellent. California fruit is now available out of Coachella, and the quality is also reported as excellent.

We have seen steady supplies of green onions crossing from Mexico. Suppliers have been very competitive with pricing. Quality has been really nice as well with green tops, minimal yellowing, and white tips.

Kale supplies remain steady with all suppliers and growing regions. Quality has been excellent with full bunches, dark green color, minimal yellowing or dehydration.

Better supplies exist with this commodity in both northern and southern California. This market is softer. The overall quality is good with slight puffiness, mechanical and a little insect damage. The weights have been reported at 38-42 pounds on palletized liner in both Santa Maria and Salinas. Santa Maria is expected to have moderate production throughout the week. Production in Salinas will likely be moderate as well. Pricing should be competitive throughout this week.

This market has softened on green and red leaf. Romaine and butter are steady. Romaine hearts are plentiful, and shippers are flexing on volume type orders. Production in Santa Maria has picked up compared to past weeks. High pricing has steered away demand. Some common defects still being reported include some wind damage, mechanical and a bit of mildew. Weights continue to be above average.

The tender leaf market remains steady with good supplies of all flavors. We have seen some minimal shortages on organic baby spinach, but not enough to be alarmed. Quality is really nice with minimal slimy decay, excessive wetness, or yellowing.

For the most part offshore fruit will end this week. There have limited sizes, but the market remains steady. The fruit out of Arizona and California is sizing large in the 9 to 12 count ranges and is commanding a premium versus fruit from Mexico. Nogales has a full range of sizes and is the most competitive with the fruit from Mexico. Quality is really nice from Mexico, Arizona, and California with good sugar levels. The offshore fruit is on its last legs with some fruit arriving with soft spots and mold.

The offshore fruit will be finished after this weekend. The market is steady for the offshore fruit. The quality is really nice even with the last shipments with good sugar levels. Mexican honeydews are plentiful and are the most competitive. Honeydews out of California and Arizona are commanding a premium, and the sizing is mostly 5ct and 6ct. Quality is really nice with both domestic and Mexican fruit with good sugar levels, no spotting, or soft spots.

Onions, Onions, and more new crop onions coming out of California, Texas, Mexico and Georgia with some storage supplies out of Washington in the pipe line. Just too many onions to hold a market. Market is at the bottom and doesn't look to be going anywhere soon. All sizes, colors, and packs are available. New Mexico has already started to clip which means onions will start shipping in the next couple weeks. If we don't see supplies tighten up around June 15th, we could see this market stay as a buyer market. Quality is good out of all areas.

Peak Seasons:
Texas and Southern California are in peak production.

Washington pear crop is in only a few hands and being packed on certain days. The pears that are left are all being repacked due to quality. Sizing is 70/80/90's with only handfuls of smaller sizes. Demand on pears is very good.

On the import front, we have a few Packham and Bosc which are mostly in the 100 and larger.

So going forward expect small pears to be much tighter than they have been. The only potential relief could be in the California Bartlett pears, but it's too early to tell what size they will be, and they won't be available until mid-July.

Alerts:
Small size pear 90 and smaller are very limited with not much relief in sight till the California Bartlett season starts in mid July.

Pineapple volume coming from the tropics remains good and looks to be so through May. Size peaking on 6s/7s.

Markets continue steady at current levels with only minimal changes. Storage supplies continue in Idaho, Washington, Colorado, and Wisconsin. Washington, Colorado, and Wisconsin have growers finishing up for the season others working through their inventor of storage to make sure they can bridge the gap to new crop. All areas have next years crops in the ground and so far are looking good. Look for the markets to slowly firm on most sizes of cartons as we get into June. Quality overall is good with only a few issues being reported upon arrival.

Supplies of Color potatoes are being shipped from Idaho, Colorado, Wisconsin, Florida, California, and Arizona. Wisconsin and Colorado supplies are winding down quickly followed by Idaho that will finish up the end of this month. Quality over all is good. Wet weather in Florida from the tropical storm sitting in the gulf has supplies limited for most of this week. California supplies are limited on all colors and sizes this week due to skinning. This has growers slowing down harvest. Idaho and North Dakota have plenty of supplies of Reds and Golds to offset limited supplies from other areas. Arizona just started this week with limited supplies of Reds but will be building over the next couple of weeks. Look for the markets to stay steady at current levels into the end of this month.

Alerts:
Rain hitting Florida has supplies limited.

Squash supplies have gotten better over the past week with Georgia shippers starting more fields. Georgia is still not in peak production, and the forecast is calling for rain all week in north Florida and south Georgia which will slow production even further. If the weather clears out more growers are set to start in south Georgia. The market has weakened but not as fast as most people thought, with cloudy conditions slowing production shippers has kept supplies current, and the held the market steady.

Alerts:
Better supplies of squash but movement is good.

Transitions:
Squash is transitioning to Georgia.

There are still some black plums available on both coasts out of Chile, but we are still a week out from seeing any California plums. Peach numbers are ramping up, and we are starting to see larger sized fruit as the season progresses. Nectarines are still hit or miss, and apricots are just starting with small fruit more prevalent.

Eastern rain is quickly churning the market upward as sizing, quality, and availability begin to show signs that the end of the central Florida season is nearing. Recent reports of more than 5 inches of rain have fallen in the Palmetto-Ruskin growing region soaking fields and postponing harvests until fields can dry. With more showers in the schedule, quality and availability are a concern while fruit is left to sit on the vine exposed to the elements. Round tomatoes are being quoted daily with an increase of multiple dollars from last week, nearly doubling the market. Similarly, a lighter supply of Roma tomatoes has boosted FOBs by a couple of dollars already this week, pressing both demand and FOBs for Mexican grown imports upward as well. Cherry and grape tomatoes have also increased by $5 or more as supplies slow to an early seasonal end. With Quincy Florida on deck for mid-June harvest, the transition to North Florida may prove to be a rocky when with a supply gap occurring the first half of June as Central Florida wraps up early from rain.

Alerts:
Florida rain may end the Palmetto-Ruskin season early creating a brief supply gap the first two weeks of June until Quincy and South Carolina break ground in Mid June.

There is a wide spectrum of fruit on the Mexican market with pricing equally representing what is paid for. It is not hard to find quotes for product listed at mandated minimums, but it is not priced without quality being factored in. Better product is selling for premiums a few dollars higher this week as Florida begins to slow down and buyers take into account the cost of freight against regional FOBS. It is reasonable to expect FOBs to slowly climb each week while supply shrinks until the middle of June when both California and Florida and South Carolina break ground in new fields. Until then, the Roma market has also begun to lift off with, climbing a couple of dollars since last week. Quality is reported as sporadic with size varying widely between shippers. There is also a considerable variance in the quality of grape tomato crops as operations begin transitioning and shippers pick between fields. Markets are forecasted to go higher through the begging of June as supply grows limited.