Market Update for Table Grapes

Week of April 13 – April 19

As expected, we saw a drastic drop off for table grape exports from Chile week 14. Less than 1.5 million total cartons were exported, signaling the beginning of the end for South American table grapes. Peru is no longer reporting exports, as the volumes are now insignificant. The southern region of Chile lost a tremendous amount of fruit and week 14’s exports validate everything we’ve been told. We could see similar volumes for week 15, but the industry needs 3 million boxes weekly to keep the pipeline filled. Strong exports in weeks 12 and 13 won’t impact the market much, as importers will be holding onto as much of their best fruit as they can just to manage commitments through the end of the month. Spot markets have jumped as well, as importers realize that every box they sell on the spot is one less box they have for their programs. The good news is that it has been very warm in Mexico, and their season seems to be on a fast track. Growers in Sonora, Mexico will start to see early crossing by the end of April and should see meaningful volumes by the 15th of May. For now, navigating through the next 6 weeks will be challenging but typically, once retailers get above $3.99 per lb., consumers will start to look for cheaper fruit alternatives and possibly take some of the pressure off.

Red Seedless

With a real shortage of green seedless and very high spot market pricing, we have finally seen demand for quality red grapes match the volumes currently entering the market. Exports of red grapes have almost equaled that of green and that had importers worried based on how red grapes under preformed the entire import season. That is no longer the case as the spot market and most programs are locked in at profitable levels for Chilean growers. So far, all the pre-rain red seedless have looked very good. Excellent eating quality and good size on Allison and even Crimsons is being reflected at store level as consumers seem to be very happy with the fruit. Spot market pricing has ticked higher, with the floor now at $28.00 FOB. Most importers are taking red grape pricing to $32.00 to $34.00 and will start testing the water at even higher prices for the end of the month. The challenge will be, as they take costs higher, quality will certainly decline with the majority of the fruit coming in after April 15th showing the effects of the rain from 4 weeks ago. Sonora, Mexico will also be earlier on the Flame harvest this year but still trailing the early greens by two full weeks, so availability will be limited until the 15th of May.

Green Seedless

Week 15 exports from Chile saw less than 500k total cartons, a far cry from the 2 million boxes the industry absorbs every week. Spot market pricing has already surpassed all pre-committed programs and now importers will have to balance the pressure from their growers to sell more fruit to the spot market. The real problem is that there is just not enough fruit to satisfy both. Chilean Sweet Globes, Timson and Arra 15 have been trading between $32.00 and $36.00, but we will see prices for that fruit tick even higher this week. Chilean Autumn Crisp are trading between programs at $38.00 and spot sales at $40.00 to $42.00. The best of the best Peruvian Autumn Crisp is still fetching more than $50.00 in the wholesale markets. While retail programs are set at $42.00 and higher, Sonora, Mexico can’t come soon enough, as there will be an empty pipeline when things really get going in May. Marketers of Mexican grapes need to be very careful though, as to not get caught up in the hype of the high spot market, because if promotions are not in place when the real volumes start to cross, the market will be headed for a freefall.