“The table grape market on the US East Coast belongs to Chile”

Through week 12, Chilean table grape shippers have loaded 503,239 metric tons of table grapes to markets worldwide, down 11% from the 566,508 metric tons shipped over the same period last season. Shipments to the US (US East Coast and US West Coast combined) over the same period this year are at 288,795 metric tons or approximately 57% of Chile’s total table grape exports so far this year. This is down 7.2% from the 311,157 metric tons shipped last season over the same period, a volume that represented 55% of Chile’s table grape export tonnage through the same week last year. “In spite of a relatively weaker US dollar and a US grape market that has been complicated and indifferent for most of the winter, Chilean shippers continue to favor the US market at levels similar to previous years,” says Mark Greenberg with Capespan North America.

 

By the end of week 13, Chilean table grape arrivals on the USEC will reach 22.9 million cases, further closing the deficit from last season to 12%. By the end of week 14, the deficit will be narrowed to 9% and will likely disappear by week 15. 

Peruvian table grape arrivals on the USEC have declined in the last few weeks with the last substantial seedless table grape arrival in week 9. Modest volumes of Peruvian Red Globes continue to arrive. The very light South African table grape program into the US has also come to an end for the season. 

 

“So the table grape market on the USEC belongs to Chile but the market continues to be complicated and troubling with receivers and retailers generally less than impressed,” Greenberg shared. Variable condition issues which plagued early Chilean shipments (especially the hapless Flames) have continued with the fruit from the Central Valley. Product that looked solid at packing has arrived with all manner of condition challenges, especially on Thompson Seedless. So, while table grape prices have stabilized to some degree, there is still a wide gap between prices for solid fruit and prices for fruit showing various forms of condition issues. 

In week 13 table grape movement on the USEC has been fair to moderate if perhaps less exciting than one would have hoped for in the week preceding the weekend’s Easter celebrations. 

 

Thompson Seedless are selling in a very wide price range reflecting a very wide range of quality and condition. Solid fruit is moving at US$ 26 - 28 for XL (900), US$ 24 - 26 for L (700) and US$ 20 - 24 for M (500) but this represents a woefully small portion of the arriving fruit. Most of the arriving Thompsons have condition issues of some form or another and the returns for this fruit will vary based upon the severity of the condition issues, the speed with which the product can be put into circulation and whether it can get in the door at a retailer rather than be consigned to a wholesale market. 

 

There is some part of the arriving Thompson Seedless volume that is being put away as storage fruit, but in this complicated season there is some doubt as to how much of this fruit is true storage fruit and actually has the legs to wait for the stronger prices anticipated for mid-April. “We expect that the traditional white seedless market will soften in the coming weeks as sellers realize that they must get through their weaker lots while they still have value and hold onto whatever storage fruit they have for later sale,” Greenberg commented.

 

Crimsons will continue to arrive as Chile’s harvest enters its last few weeks. Crimson sales on the USEC are running at US$ 20 – 22 for XL (900), US$ 18 – 20 for L (700) and US$ 16 – 18 for M (500). Crimsons are not facing the same condition challenges as the Thompson Seedless. While we expect to see light sales in week 14, the week following Easter, we anticipate solid movement thereafter. Mexico’s Sonora table grape crop and California’s desert crop are both said to be facing some delay so there is some hope that if product condition holds up and the fruit is unaffected by last week’s rains, we could see a strengthened Crimson market in the last weeks of April.

Early end of California citrus season 

California citrus producers continue to face weather challenges that have slowed the harvest, reduced the expected yield and portends an early end to the domestic sweet citrus season. In the meantime, domestic navel oranges are selling at price levels seldom seen in March with 40’s selling at US$ 16 – 18, 48’s and 56’s at US$ 18 – 20 and 72’s and 88’s at US$ 20 – 22 (all prices FOB point of loading in California). California mandarins are selling at US$ 34 – 36 for 10 x 3 lbs bags. 

 

“With California navel oranges not expected to go beyond June and mandarins not likely to go beyond mid-May, expectations for the Southern Hemisphere sweet citrus market are running high. Very high,” said Greenberg.

 

The first clementines from Chile and Peru are expected to find a depleted, if not empty, market and growers anticipate an opening price in mid-April in the US$ 40+ range. Import volumes will increase as we enter May and by mid-May there should be an interesting mix of easy peelers from Chile, South Africa, Peru and Uruguay with good volumes expected throughout the summer. Late Mandarin volumes from all Southern Hemisphere sources continue to increase as more acreage comes into production and more is planted. But increased consumption is expected to keep pricing relatively stable. 

 

The navel orange harvests in both South Africa and Chile are running slightly later than last season and there is an expectation that there will be a gap on the USEC between the end of the California season and the start of imports. Imported navel oranges from South Africa will begin to arrive in mid-June in light volumes. But South African and Chilean navel volumes will ramp up in July to levels better able to service the market and retail programs. It is significant to note that the AMS/USDA Marketing Order For Oranges that regulates the maturity, quality and condition entry requirements for navel oranges does not apply for arrivals in July and August. 

 

The early start to the imported navel season should deliver value to growers and exporters not so much in the form of higher prices - although we are expecting stable and attractive prices this summer – but, rather, in the form of lower inventory build-up throughout the season. The impact of a low inventory buildup will result in the delivery of better quality to chain store customers and less shrink at retail as well as in the value adding process and distribution chain.