Market Update For Table Grapes
Week of April 6 – April 12
Over the past week, we’ve seen better retail demand for table grapes and a sense of stability to the market. After a rush of consumer panic buying in mid-March, retailers were challenged logistically and eventually found themselves carrying heavier inventories than they had planned. It took weeks for that product to move through the system, but finally last week we saw consistent demand, hopefully setting the industry up for a stable month in April. Consumers are now adjusting to their new normal as online purchasing continues to spike higher and the panic and confusion has subsided. Table grapes as a category seem to be holding their own, even as more essential items like citrus and apples lead in consumer purchases. Not surprising, we have seen increased demand for packaged produce items like bagged salads and citrus as the general public has raised concerns about the safety of bulk produce displays. Grapes fall somewhere in between, but the ability to just grab a bag quickly certainly helps with impulse buying. Chilean table grape export volumes are actually a bit stronger than expected, as it looks as if Chilean growers were holding onto fruit in hopes of stabilizing grape pricing. Only time will tell if that strategy will result in positive returns for growers but for now marketers and retailers need to focus on keeping table grapes relevant at store level.
According to the most recent Chilean reports, overall shipments last week of red seedless are higher than expected. Most likely, growers and shippers were holding back supplies due to the poor markets in March, while hoping to achieve better pricing for April. It’s typical to see an influx of fruit right before the April 10th USDA Marketing order, but these numbers indicate significant volumes now set to arrive through the end of the month. That being said, we are still seeing 20% less fruit coming to the US market for this time period, compared to the last two seasons. With less volume to send, steamship companies have reduced vessel schedules with only one boat leaving every other week. Even with 1.6 million boxes of red grapes currently on water and more to follow, the industry should be able to manage these numbers. Expectations are for Chilean red seedless supplies to carry the industry to a smooth transition to Mexican supplies in May. Pricing on good quality Chilean red seedless currently ranges from $16-$18 on medium/large, $18-$20 on large and $20-$24 with the mostly market at $22 for premium fruit. With so much uncertainty and reasonable volumes available, it would be unlikely to see any changes in the market over the next two weeks.
Although green seedless pricing has spiked higher over the past 10 days, supplies seem to be readily available with plenty of fruit being offered on the spot market. Overall quality and condition has been better than expected, as we typically see growers and shippers saving their best lots of storage Thompsons for the April market. There are still volumes of fair quality and repacked green seedless that are being discounted to move quickly. As FOB’s have ticked higher, store level pricing has followed and overall demand has dropped off significantly. Many importers are still projecting that green seedless supplies will come up short, but after 10 days of slow movement, it might not be so easy to take FOB’s higher. Pricing on good quality Thompson seedless currently ranges from $26-$28 on medium/large, $28-$32 on large and $32-$36 on x-large. Expectations are to see overall shipments wind down for the season after the April 10th marketing order, but we should see supplies available until the third week of April. Look for early Mexican green seedless to start crossing the border towards the end of the month. Red seedless should continue to out-sell green seedless 3-1, especially with a $10 difference in price.
With retail buyers reducing overall SKU’s and focusing on key produce commodities, black seedless movement has suffered with only moderate demand. Overall quality and condition remains very good with both Chilean and Peruvian supplies available in the market. Pricing currently ranges from $20-$22 on medium large, $22-$24 on large and $24-$26 on x-large. Look for FOB’s to remain at current level over the coming weeks as importers keep pushing for market share.