The Source - May 29, 2019

Eastern Region:
Out East, the apple market remains steady, even though availability on certain sizes, grades and varieties continue to be on the tighter side. Only four shippers reporting out of Michigan and sheds continue to close as we make our way to June. Prices have firmed up, especially on smaller, foodservice sizes, with ‘pocket’ deals available from shippers looking to clean up inventory.

Washington:
Out West, Washington shippers continue to see demand from the Midwest and East, which has put ‘the squeeze’ on an already depleted inventory of smaller fruit (125ct and smaller). Adding to that, retail demand is taking a significant portion of the smaller sizes, and at a higher return to the shipper. There are deals to be had on larger fruit (100ct and larger), so please be on the lookout for ‘Spot Buy’ emails. We are beginning to see schools close for the summer, which should help ease demand on 113ct and smaller.

Continue to send Apple and Pear orders early. 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. We are seeing some ease in volume due to schools ending for the summer, but it is gradual.

New harvest Chilean (FOB-L.A.):
Chilean Granny Smith – 80ct XFCY (available now)
Chilean Braeburn – 70-90ct XFCY (available now)
Chilean Pink Lady – 70-90ct (available June 13)

Central Mexico (Guanajuato) has started with very low volume this week. Volume should increase by the end of next week and should run through early September depending on the weather. Domestic volumes from all regions are about the same. Peru has increased volume from the north, but the south is starting to slow down due to seasonality, and cool weather. We will start to see less of the bigger sizes due to the south slowing down. Markets on the west coast are about steady, but the east coast is seeing lower markets due to New Jersey/Michigan/Canada/Peruvian regions with good supply.

California growers have increased harvest volumes for the west coast and in step with Mexican price increases. This may shorten the California season with a historically small crop and end earlier than projected. The industry could see field increases post-Memorial Day. Organic field prices have continued to rise. Abnormal wet weather patterns have disrupted the harvest. With the current rains, we can expect lenticel spotting externally. Lenticel spotting does no harm to the fruit internally and disappears as the fruit ripens.

Field prices for Mexico remain elevated. Demand has lighted up due to high prices. The market appears to have stabilized at this point. Most sizes/grades are tight with reasonable availability on large #2s. Fruit is mature with short shelf life but, eating quality is outstanding. Summer crop expected to start with good volume mid-July. Prices for organic fruit are expected to remain high through the duration of Mexico's crop. The avocado market is likely to remain elevated until new crop/summer crop becomes readily available.
Good supply on Peruvian fruit with the bulk of it available June- August.

Green Bell Pepper supply is good, peppers are being harvested in Florida and Georgia. Florida is having quality issues and growers are winding down for the season this week. Georgia is harvesting good volume of good quality pepper, but the heat for the past 5 days has been extreme. This heat will have an effect on future supply, pepper plant stress easily and will stop producing under the current conditions. The market has been declining over the past week but if the heat holds up that could change quickly.

Alerts:
Extreme heat could hurt supply in the next week.

Peak Seasons:
Bell Pepper is in peak season

Green Bell Pepper- Light production of green bell pepper continue to arrive in Nogales from Sonora, Mexico where mostly choice grade is being harvested. The green bell pepper crop is expected to finish within 7 to 10 days. The quality from the Sonora district is fair to good. Number #1 and choice grade green bell pepper is also being harvested in Thermal, CA. Green bell pepper supply currently exceeds demand. The quality from California is good. Market on green bell pepper is Low/Steady. Green bell pepper from Mexico is also available to load in McAllen, TX.

Red Bell Pepper- Light supplies of Red bell pepper arriving in Nogales. The market on red bell pepper has risen slightly as production and in thermal have not yet started with good numbers. Light/steady volume continue with Hot House variety in mostly choice grade pack. Very light production on elongated variety starting in California. Steady production expected through Nogales through the week. The quality of red bell pepper out of Nogales remains good. Light supplies of Red hothouse bell pepper also being harvested in Baja California. Red bell pepper is also available to load in McAllen, TX.

Yellow Bell Pepper- Light volume of Yellow Bell pepper still arriving in Nogales. Hot House variety is mostly being packed in choice grade. Yellow bell pepper demand has decreased and currently meets supply. Market on yellow bell is steady. Coachella has started to harvest light supplies of yellow bell and should increase with better temperature’s in the growing district. Yellow Hot House bells are also available to load in McAllen, TX.

Blackberries are steady coming out of Mexico and Central California. Quality has been good. There have been some transfer issues causing delays. Look for the prices to increase slightly as we move into the weekend

Blueberries are beginning to decline coming out Mexico and Georgia. Product is at the tail end of their season. California is ramping up production. Quality and yields are expected to be good. A few shippers are reporting a small planting gap in the near future affecting their availability. Other shippers are reporting seamless production. Look for the market be slightly stronger as we move through the week.

Raspberries are coming out of Mexico and California. Quality is good out of both areas. The market remains steady with slightly higher overtones. Some shippers are relying heavily on transferred Mexican product and shipping delays and substitutions to organic product have been reported. Production should streamline as we move farther into the summer in California and temperatures begin to heat up.

Strawberries continue to be inadequate supplies as we move past Memorial Day. Quality is still fair out of Salinas, Watsonville and Santa Maria with shippers working through residual water-related issues from two weeks ago. Last weekend's rains were largely insignificant and harvests were not affected. Look for markets to ease off as we see slightly higher temperatures begin to take effect towards this weekend increasing yields for most growers. Demand has been good for the front of this week but may slow down as we move through this week.

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

The Brussels Sprout market continues to be in a demand exceeds supply situation. Brussels Sprouts remain extremely tight with supply being affected by the recent rains in Salinas and Oxnard during the growing process. The quality has been affected by the rain and cold weather and sizing tend to run smaller due to this recent colder weather. Look for the Brussels Sprout market to remain tight going into next week.

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

The cauliflower market has started to come off as there continues to be more supplies in the pipeline. Yields are getting better and the heads are starting to size up. 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.

Light supplies continue to be the story with this commodity. This pattern will continue for the next few weeks at the minimum. Production in Salinas is expected to begin approximately the second to the third week in June. Demand continues to exceed supplies. Production in Santa Maria and Oxnard is not enough to meet demand in the marketplace. Production in Mexico due to erratic weather has been light. Some defects being reported upon arrivals which include mechanical, leafy tops and seeder.

As expected, the rain in California last week created havoc on cherry supplies. It had a detrimental impact on quality, causing heavy pitting and splits on the ripe fruit. It has completely wiped out some growers, leaving very little usable fruit on the trees. Other growers are trying to salvage what they can, but availability is extremely limited and quality is fair. Market prices have jumped up quickly and will continue to escalate until we transition into the Pacific Northwest harvest in mid-June.

Alerts:
Cherry supplies have been essentially wiped out due to the heavy rains last week. Availability is extremely limited and markets are escalated.

Transitions:
Pacific Northwest harvest will start in mid June.

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

Pasilla- Moderate supply of Pasilla peppers available to load in Nogales, AZ from Mexico. Moderate volume is expected to continue through the week. Quality on Pasilla is fair to good. Size on the pepper is mostly medium to Large. Market on Pasilla is steady. Pasilla crossing through Nogales is being harvested in Sonora. Pasilla from Mexico also available to load in McAllen, Texas.

Anaheim- Moderate supply of Anaheim available to load in Nogales, AZ from Sonora, Mexico. Moderate Anaheim production expected to continue through the week. Quality of peppers from Sonora is fair to good with mostly medium size. Anaheim continues to be harvested in Sonora, Mexico. Anaheim from Mexico also available to load in McAllen, Texas.

Serrano – Moderate supplies of Serrano peppers available to load in Nogales, 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 Nogales, from Mexico. Quality of husk variety is good. Good supplies on husk tomatillos are expected to continue through the week. The tomatillo market is expected to increase. Both Husked and Peeled tomatillos are increasing in the teens. Both varieties of tomatillos also available to load in McAllen, TX.

The cilantro market continues to remain steady in Mexico with the recent warm weather and now production has started in Salinas. The cilantro quality is good with an occasional yellow leaf. Look for the cilantro market to continue to stay steady going into next week.

Lemon supplies continue to remain snug on 165’s and smaller, heading into June expect limited availability until we’re able to offset orders with offshore lemons. Market prices continue to climb weekly, looking at the low $30’s on choice and fancy fruit. Lemons supplies continue to peak on the large sizes 75ct/95ct/115ct. The rain and cold weather brought on the larger fruit and smaller fruit is staying limited on sizing and green on the trees.

Limes supplies are improving, we’re seeing more crossings from the border and more shippers are quoting open market fruit. Supplies continue to peak on the 200’s and smaller, with markets in the low teens. Supplies continue to remain limited on large sizes 110’s – 175’s, markets in the high $20’s. The lack of rain in the growing regions has brought on the volume on the small sizes. The market is still expected to stay strong on large size fruit until supplies improve by mid to late June.

Supplies on Navels and Valencia are looking to be in better shape this week after the rain we had last week. Late season navels are still in full swing, we’re looking at another three weeks until we fully transition to Valencia’s. Foodservice sizes 113’s and smaller will remain snug the rest of May going into June until we fully transition to Valencia’s. A majority of shippers are utilizing Valencia’s to offset the balance to fulfill orders in full. Markets are looking to be in the $14-$16 range depending on grade and size. On Specialty Citrus, we’re looking steady on the Delite Mandarins that are peaking on 15’s - 40’s. Cara Caras & Blood are moving along nicely, steady supplies are available. Ojai Pixie Tangerines quality is looking great and the taste is excellent. Please reach out for pricing.

Cucumber supplies are coming mainly from Georgia with a few still being harvested in Florida and the Carolina's are starting light volume this week. Georgia has been producing good quality so far this season from most shippers, volume is declining mainly because of extreme heat. Movement is very good especially on #1 supers and carton 24's, #2 product is also starting to move better, we expect pricing to rise for the weekend. North Carolina is starting this week in what is traditionally a short and fast season. There are only a few growers in the eastern part of the state that come in with a big splash and then quit as soon as their pepper crop starts.

Alerts:
Supplies on cucumbers are getting tighter by the day.

Transitions:
Cucumbers are starting the transition up the coast to the Carolina's.

Moderate supplies of cucumber are 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. Quality out of Sonora growing district is good. The cucumber market is currently steady and is expected to remain steady. Mexican cucumbers are also available in San Diego from the Baja growing district where the quality is also good.

Eggplant supplies are very tight. Plant city is shipping steady volume but shippers are over their peak volume. Georgia is starting light volume this week with a few shippers but volume will not start until late next week. Quality has been good in both regions and eggplant are the one item that likes the high temperatures.

Alerts:
Supplies are very tight.

Transitions:
Eggplant is transitioning to Georgia.

Light supplies of eggplant arriving from the Mexican State of Sinaloa. More choice grade eggplant than fancy are arriving from this district. The eggplant crop from Sinaloa is expected to finish within 7 to 10 days. Light supplies of eggplant also being harvested in Thermal, CA. Eggplant supplies from Thermal are expected to increase with better temperatures in the growing area. The market is expected to increase as supplies decrease as the Sinaloa crop finishes and California crop not fully started. Quality from Sinaloa is mostly fair. Eggplant quality from California is good.

Green grape supplies have started to improve this week and are expected to ramp up over the weekend. Most of the green grape production is coming from Mexico. Coachella is still a week from getting started. By the second week of June, we expect to have both areas in full production with excellent supplies. This week, market prices are still firm. With the increased production later in the week, we may see prices adjust down slightly, but markets won't shift until Coachella harvest gets started. Quality is being reported as strong. The majority of the fruit is being shipped from Nogales, but as more fruit becomes available, it will be transferred to CA locations to load with red.

Transitions:
Coachella is expected to start in another week. Mexico harvest will ramp up this weekend.

Red grapes are going to start ramping up quickly. Although we are starting the week off with limited availability out of Nogales, most shippers are expecting a flush of fruit to hit by the weekend. Mexico harvest is expected to pick up as well as Coachella. Market prices remain high, but I expect that to change as production increases. At this point, shippers are being cautious to quote cheaper, but I anticipate prices starting to drop by $4-$5 next week. Quality on all new harvest is being reported as very good. With the warmer weather expected this week in all growing regions, we can expect higher sugar levels and better yield. We can expect strong supplies for the summer season, as soon as we get past this short term shortage.

Transitions:
Supplies will continue to increase as Coachella and Mexico production ramps up over the next week.

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.

Demand is off. The holiday at the start of the week has slowed business. There was a good amount of rain that hit the growing regions on Sunday, but supplies were still ample enough to meet demand. This market is steady overall. Some issues with this commodity that has been reported include big vein, insect damage, mechanical, and occasional growth crack. The weights on liner product have been reported at 41-46 pounds. Supplies are expected to be moderate to good for the entire week with most shippers.

A few suppliers were expecting stronger markets due to the past week's rains in the growing regions, but the demand remained steady, overall. Some common defects being reported on romaine include twisting, mechanical, fringe burn and insect damage. Green and red leaf, as well as butter, are also similarly being reported with the same defects as romaine. Shippers are disclosing up front these issues. The rain was strong this past weekend, but there is no rain is in the forecast for this week. Expect quality to remain fair. The weights on romaine are averaging 34-37 pounds while green and red leaf has been 22-26 pounds.

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

Cantaloupe market is active this week. We are seeing price increases on all sizes. The pipeline has cleaned up on offshore fruit as they are done for the season. Mexico is tapering off on production and will be done by next week. Domestic fruit has started but, seeing very light volume this week. Due to extreme weather conditions earlier this year, growers got a late start to the season. This warmer weather in the desert should help bring on fruit quicker as we are seeing optimal growing temperatures for melons (90F-100F). Currently, the best quality we are seeing is on the domestic fruit. Brix is ranging from 12%-16% with good internal and external color.

The honeydew market remains flat this week but will improve in the coming weeks. Very light demand on all sizes. There is still some offshore dews in the pipeline but, pretty much done for the season. Mexico will have good volume into June. Quality on Mexican fruit is good externally and eats great. Domestic melons are showing some external issues. We tend to get some strong winds this time of year (Brawley, CA & Maricopa/Yuma, AZ) causing external scarring. Brix/sugar levels on domestic fruit is ranging from 10%-12%. Good supply on domestic mixed melons and will be available through June.

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

South Texas and California desert onions are winding down as we begin transitioning into New Mexico and the California San Joaquin Valley. Both areas will finish in the next 7-10 days. Uvalde, Texas will have supplies until mid-June. New Mexico has started with all three colors available. Supplies are limited on the larger sizes to start the season but will increase as we head into June. California San Joaquin Valley will start next week. Markets are relatively steady with some decrease in the white onions as supplies improve. Quality is good on the fresh run onions but will exhibit a thin, flaky skin set and shorter shelf life.

Market/prices remain steady on pears out west. Foodservice sizes (110ct and smaller) – on Washington Anjou and Bosc pears – are slowly becoming available, but are in few hands. Half carton Red Anjou pears are the prevalent pack – for most shippers – this time of year (30s through 55s) and are available through mid-June.

Bosc pears are expected to end mid-June. Volume is on 110ct and larger, with smaller sizes slowly becoming more available. Anjou’s should be available through July.

Chilean and Argentinean Bartlett pears are still available and loading in Los Angeles. Also, Chilean Packems (70-120ct) are available to load in the City Of Angels.

California Bartlett pears are expected to start the week of July 8.

Pineapples supplies are looking steady. Quality has been solid with a nice brix to add. As we head into June supplies looking to be good. The only issue we seem to run into is product coming off USDA inspection hold. If we expect any delays we’ll be sure to communicate it. Markets remain steady $12-$14 depending on the size.

Idaho russet potato markets continue to inch up on the larger size 40-70 count as supplies are limited on the Burbank variety. 80 count and smaller are steady as the Burbank size profile is small. Consumer business is good and moving cartons through packing sheds as we approach the Father's Day holiday in the next few weeks. Quality on Burbank's 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 slightly higher pricing; Wisconsin quality is fair. Advanced orders for large size potatoes out of Idaho are necessary to ensure full coverage. Expect rising markets on larger size 40 - 70 count through the summer months until new crop harvest begins in August.

Alerts:
40-70 count sizes are limited. Advanced orders are needed to ensure coverage.

Color potato markets are rising as Idaho winds down for the season and will have limited storage supplies until new crop begins in September. Sizing on each color will be sporadic with rising markets. California is producing out of Bakersfield with all three colors into July. Stockton, CA is expected to start mid-July and run through August. Eloy, AZ is running red and yellow potatoes through the month of June; quality and color are good. Florida has transitioned north into the Hastings area with all three colors and excellent quality. Supplies will be available through most of June. Texas is expected to start early July followed by Minnesota and Wisconsin starting in early August.

Squash is in good supply with light supplies in central Florida, good supply in Georgia and the Carolina's and Virginia starting steady volume. Extreme heat will hurt supplies in the southeast, plants will stop producing with the kind of temperatures the region has received over the last 5 days and the forecast does not have any real relief this week. Quality on zucchini has been good for the most part, yellow squash has had a few issues with scaring and discoloration. The heat is also hurting the shelf life on yellow squash.

Transitions:
Squash is Transitioning up the coast to the Carolina's and Virginia.

Peak Seasons:
Squash is in peak season

Light supplies on both Italian and Yellow straight-neck squash continue to cross through Nogales, AZ from Sonora, Mexico. The Italian and Yellow straight-neck crop from Sonora is currently producing mostly #2 quality on both fancy and medium size. Both Italian and yellow straight-neck #1 grade squash are being harvested in Santa Maria and Baja California. Market on soft squash is steady but could increase with cooler temperature expected through the week in Santa Maria. Quality from Santa Maria and Baja California is good.

This week we will see increased harvest numbers on all varieties including plums. This will be the first week of harvest on domestic plums, so volumes and size selections may be limited. Market prices on plums are starting off on the high side, but we expect supplies to improve and market to adjust down over the next 2 weeks. Quality is being reported as strong. Yellow Peaches and White Nectarines are still yielding the highest volumes this week, but all fruit is ramping up. Market prices have started to gradually decline across the board. Both tray pack and volume fill packs are available. Quality is very good. As we move forward, we expect to have a good domestic season with plenty of promotional opportunities.

Transitions:
Plums are starting this week.

Most Florida shippers will finish crown picking this week in the Ruskin and Palmetto districts. Recent temperatures in Florida have been in the mid-nineties and recent rains are casing quality concerns with scarring, some softness and fewer travel legs mixed throughout pieces in transit. There have been fewer offerings on the 6x6 and 6x7 size over the past two weeks, however, smaller offerings are improving through the first week of June. Roma tomato supplies have contracted as districts begin to transition north. Supply will remain diminished until Mid-July when eastern regional programs begin production. Grape and cherry tomato volumes and quality have been up and down due to weather as most growers approach the end of their crops in the central portion of Florida. South Carolina is forecasted to begin harvesting a new crop as soon as next week and should alleviate some of the softness and splits currently in puckouts this week. The Quincy districts in North Florida and South Carolina that are beginning next week are forecasted to run through the July 4th holiday. Tennessee is forecasted to begin operations near July 10th, shortly followed by Virginia and smaller eastern seaboard deals.

Mexico tomato prices continue to fluctuate while growing regions transition. New crops in Eastern Mexico and Baja are underway and should begin to increase the number of crossings into the US. San Diego will have crossings through Summer with a small dip in supply the first part of September. Hot weather is causing some puffiness in fruit but there is plenty of good product to be sourced. Mainland Mexico is slowly improving Grape tomato harvests while Baja produces better quality this week. Duties are set at 17.56% of the value of tomatoes crossing into the US directly affecting the cost of goods. It is too soon to determine how the supply will be affected, but it is expected that imports will be reduced at some point down the line.

Alerts:
The Department of Commerce has officially terminated the 2013 Suspension Agreement for Fresh tomatoes from Mexico, setting a 17.56% duty on Mexico tomatoes arriving in the United States. The Department of Commerce has directed Customs and Boarder Protection to collect cash deposits or bonds in the amount of 17.56% of the value of product entering the U.S. unless, or until, a new deal can be made between the U.S. and Mexico. Following the refusal of the most recent Florida Growers proposal, Mexico growers on May 23rd have proposed new terms for an Agreement the Florida Tomato Exchange is, “Considering a step backwards” from the May 10 proposal stating “The domestic industry simply will not support any proposal that does not stop the injury to American growers by dumped Mexican tomatoes”. It is a good sign that negotiations continue but a deal is yet to be struck between the two countries for the time being.