Market Update For Table Grapes
Week of April 19 – April 25
For months, importers have offered aggressive pricing on Chilean grapes in hopes of moving through substantial volumes of suspect quality lots. Rejections have mounted, and so has the demand for better quality fruit. As a result, we have seen market pricing for good-conditioned grapes tick higher. Unfortunately, cold storages are still packed with fair and poor quality inventories that will no longer make retail specification. Regional terminal markets, as well as food banks across the country, can no longer move through existing volumes. We will see thousands of pallets being dumped this season, costing Chilean growers millions of dollars. The financial losses incurred will not be fully known for months, but some growers will not survive. It’s likely that remaining supplies of Chilean, Peruvian and Brazilian fruit will not be sufficient to make a smooth transition south of the border. The most recent estimates from Mexico indicate a crop of just over 20 million total boxes, and the majority of that fruit will cross into the US in June. Spot markets are expected to remain very strong all the way through the month of May, and then drop like a rock once production ramps-up. Retailers will look to take advantage of both promotional opportunities and aggressive FOB’s from Mexico. Marketers will be pressed to move through another large crop before California supplies become available by the second week of July.
The industry is experiencing a true split market as importers continue to offer very aggressive pricing on fruit that needs to move quickly. Growers from the northern region of Copiapo, Chile have been sending decent volumes of good quality, late-season proprietary red seedless. Some marketers are asking a premium for that fruit, and others will be looking to hold supplies until the first week of May. There have been reasonable volumes of good quality Crimsons arriving ,but those numbers will decline rapidly now that we are past the April 10th USDA Marketing Order. Pricing on good quality Chilean red seedless currently ranges from $14 on medium/large, $16-$18 on large and $20-$22 on x-large with the mostly market at $20. Importers still holding onto premium lots of Peruvian Jack Salute are able to fetch pricing over $24. With early shipments of Flames from Mexico not expected until the 15th of May, supplies of good conditioned red grapes will be hard to come by, and spot market pricing is expected to go higher each week. Retailers will have to wait until June to set red seedless promotions with confidence.
Overall supplies of good quality green seedless have been relatively short since the middle of March. With volumes from Jalisco, Mexico unable to make an impact, we are set to see short-supplies well into May. Importers with strong Brazilian programs will have a leg-up on the competition, as the majority of green seedless volumes are in just a few hands. Although volumes have been greatly reduced, retail pricing has been at or above $2.49 per lb. since the middle of March, keeping overall demand tempered. We should continue to see arrivals of Brazilian Arra 15 and Sugar Crunch into the first week of May, and Sweet Globe shipments from Jalisco should increase week by week. Early reports from Hermosillo indicate less acreage of Sugraone this year, but we will see more volume of proprietary varieties in June. Spot market pricing on good quality green seedless ranges from $34-$36 on large and $36-$38 on x-large, with some importers fetching $40 and higher for premium lots. There will be very limited promotional opportunities on green seedless until we get to June, followed by volumes from Mexico set to come-on fast and furious.
There seems to be steady supplies of Peruvian Sweet Favor and Adora available, as well as good supplies of Chilean Autumn Royal. With general shelf space for table grapes reduced at store level, retailers have not made an effort to push black seedless. Spot market pricing has dropped quite a bit over the past two weeks, as importers have been trying to spark some last minute movement. Pricing for good quality black seedless ranges form $18- $20 on large and $22-$24 on x-large and jumbo. As long as condition holds, there should be supplies available into May.