Market Update For Table Grapes
Week of June 14 – June 20
By the second week of June, we should be at the peak of Mexican table grape volumes, but it’s starting to feel as if we may never get there. More than 10 million boxes have already crossed the border, and some have adjusted the total crop to less than 17 million. Down from the original estimate of over 20 million. This year we have seen more boarder rejections for wind scaring and low brix on proprietary greens and a much lighter crop of Flame Seedless. This adds up to a very unusual situation as spot market prices rise higher; something we very rarely see in June. Mexican growers are putting pressure on marketers to take advantage of this unexpected shortfall, but national programs are booked-in well below today’s prices. Caborca, Mexico is still expecting good volume and is just getting started. We’ve seen this before where retailers will react and take store level pricing higher, slowing overall movement. Either way, we are in very uncharted waters for a mid-June Mexican table grape season. Looking ahead, California growers were originally concerned about the Mexican season overlapping. That no longer seems to be a threat, as Mexican supplies look to wind down by the middle of July. This week, temperatures in the Central San Joaquin valley will top 110 degrees for 4-5 days straight, pushing back start dates for many California grape growers. We shouldn’t expect any meaningful volumes from Arvin until after the 4th of July. It’s possible that we could see the markets for all table grapes hold at current levels until then.
This year’s Mexican Flame crop has been underwhelming as size has been an issue and overall quality has been just fair. The only thing keeping the spot market stable is a lack volume crossing. Growers in Caborca are just beginning to harvest, and expectations are to see much better size and condition from that region. Flame volumes from Coachella have been way down this year as well. Marketers have been able to hold prices firm since the middle of May. We might see the spot market in Mexico tick much higher towards the end of the month for both conventional and proprietary varieties. There has been more volume of Sweet Celebrations from Mexico this year, but size and quality has also been a bit of a disappointment. Pricing on Flames currently ranges from $12.95-$14.95 on medium/large and $16.96-$18.95 on large with many retailers locked in at $16.95. Very few lots of premium x-large Flames are available at 20.95. Sweet Celebrations are being quoted from $20.95-$24.95 with the mostly market at $22.95 and holding firm. Look for Flame pricing to remain where it is through the end of the month, and then tick higher by the first week in July.
What a difference a week makes! Over the last 10 days, there had been steady volumes of Ivory, Sugar drop, Early Sweets and Sweet Globes available. Growers were anticipating volumes of Sugraone’s to start crossing by now, but the fruit just isn’t ready. By the end of last week, demand far exceeded the supply, and marketers felt pressure and started taking the spot market higher. This year’s Sugraone crop was expected to be lighter as many growers have pulled them in favor of planting proprietary varieties. With many major retailers locked in with lower pricing, marketers will be stuck trying to cover cheaper commitments, and appeasing growers looking to take advantage of the spot market. Don’t be surprised to see retailers adjust store level pricing and back-off promotions through the balance of the season. If growers continue to get rejections on the Mexican side, and Sugraones from Caborca are lighter than expected, we could see these pricing hold until August. FOB’s currently range from $18.95-$20.95 on Sugraone with some looking to push to $22.95. Sweet Globe pricing has also adjusted higher from $20.95-$24.95. Look for the first green seedless from Arvin by the 15th of July.
Overall movement on black seedless continues to be flat, unless you are a grower with promotional support. Even so, supplies of black seedless are not readily available. Growers in Mexico have greatly reduced acreage of Summer Royal, due to low returns over the past 5 years. FOB’s on Mexican black seedless are relatively high ranging from $20.95-$24.95. Mexican Sweet Sapphire range from $22.95-$24.95 with only limited availability. There seems to be better volumes of Midnight Beauty in Coachella, but supplies are controlled by just a few marketers. Pricing on Midnights range from $22.95-$26.95 with size being the determining factor.