California celery growers backing off as local regions start

The celery season is in a bit of a flux right now as supplies out of various regions experience mixed fortunes. In Mexico, heavy rain has meant volume and quality have dropped considerably, leaving the summer program in a difficult position.

"The Mexico season is stumbling along," observed Mark Sato of Fortune Growers. "The weather has been very bad, with torrential rain falling for three weeks straight. This has really reduced the quality of celery coming across the border. We are still managing to pull some clean celery now, but bug infestations, light color and quality concerns are causing receivers to be cautious." 

Meanwhile, in California, conditions are good and quality is high. However as Sato explains, growers there are preparing to slow down production so that they don't compete with local programs that are about to kick off. "California quality is excellent and weather has been good," he said. "The bigger growers though are now tapering off in their production and therefore volume is coming off due to more local markets that come online during the summer."

The local regions like Michigan and Canada are facing a few problems at the moment. The Michigan season should be well underway now, but only negligible supply has come through at this time. Canada too, is beginning a number of vegetable crops but volume is reportedly very low. It all means that the market is somewhat elevated, providing an opportunity for growers to enjoy some returns instead of barely covering costs.

"Michigan is supposed to be in full production by now but they have only been producing small sizes so far, with the larger-sized celery being delayed until the week of July 23," Sato noted. "Michigan does ship heavily into the Midwest and the Northeast with competitively priced celery although some buyers still show preference to other regions like California. Canada is due to begin importing celery next week, but has already started a few of their other summer programs now such as broccoli. However, volumes are very low and what they produced in the last two weeks has already been sold out. California is seeing excellent quality celery but as mentioned, is likely to reduce output over the next few weeks."

"The celery market is finally out of the dumps and we are seeing some good FOBs now," he continued. "California celery is today seeing $11 FOB, while at the border, prices are also at $11. While it's not very high, these are respectable numbers and much improved on what they were several months ago. Over the next month, we will be waiting on those local programs to start up and we will see how demand goes and how prices will subsequently move."

The relatively short Northeast growing season will result in a diversifying of sourcing options across all commodities. High freight costs provide an opportunity for these local growers to have a broader distribution than otherwise would be possible. These growers tend to have higher costs, so once out of the region - and the logistical advantage - they have difficulty penetrating the market.

"Many of the Northeast regions are beginning their various summer vegetable programs shortly," Sato explained. "They have the advantage in their respective areas because freight costs are still very high. However, farming costs are high for these growers. For example. in Canada, broccoli growers have to plant further apart, resulting in lower yields. California shippers have a tough time matching their delivered in prices. However, with higher freight rates this year, the local programs will be able to charge higher FOBs."

"Mexico is geographically better to supply the South and Southeast," he added. "Furthermore, the market on the hardier vegetables from Mexico like carrots and cabbage is very strong right now. Growers there are also enjoying a strong domestic market, with high demand and lighter volumes due to the difficult growing conditions."

For more information:

Mark Sato 

Tel: +1 (805) 481-1055