By Mark Greenberg from Fisher Capespan
Dramatic shift Chilean grape exports to Asia
Through Week 10, the total volume of Chilean table grape arrivals on the east coast was running roughly equal to last season with a strange mix of higher volumes of Thompsons (for now) and Crimsons, but far lighter arrivals of Flames and Red Globes. The generally light weekly arrivals has left the market stable with upward price pressure on both red seedless and white seedless grapes. With the end of the Chilean harvest in sight (with really only a few Thompsons and the Crimsons left to harvest), we expect to see firm pricing through the end of the deal. Indeed, last season almost 3 million cases of Thompson Seedless arrived in Weeks 13 – 14 – and 15, combined. There are sure to be far fewer arriving in those weeks this season. So, although it is not yet clear how many Crimsons will be shipped to the US from Chile, it appears that there will be a healthy scarcity of grapes from now until the end of the season.
Red Seedless:
An obviously distressed customer called twice this week to ask why it is that red
seedless grapes, a product normally widely available in the last weeks of February and even in early March, were unavailable this season. Actually, it was not the absence of fruit that caused his distress. Rather, it was what he felt was the failure of “The Industry” to predict this a few weeks in advance and to prepare the market accordingly. It’s a good point and one we have made at various times in the past: Good advance field information from Chile generates efficient sales. Sellers can’t make fruit appear when it doesn`t exist, but we can prepare our customers for the gap and plan with them. Instead, what we have in the market today is a vacuum where the red grapes should be and customers left feeling disenfranchised. As a result, those customers have no hesitation of insisting that US$ 18 commitments for Flames (made perhaps four weeks ago) be honored today when the spot market is at US$ 22-24 (heated up by the absence of fruit, and then super-heated by the frenzied attempts by sellers to find fruit with which to honor commitments).
Today, red seedless grapes are a hot commodity. Flames (if you can find any) are
selling at US$ 20-24. There are some light volumes of Crimson in the market and
they are also enjoying the scarcity of red seedless grapes selling in a price range of
US$ 20-24.
With the Thompson harvest done, attention in Week 11 will focus on Crimsons. But,
as we noted above, it is not clear just how many Crimsons will be shipped to North
America. Reports out of Chile suggest that the peculiarly warm days and evenings
has left the Crimsons slow to color. In all events, we expect Crimson arrivals to
continue through Week 16 but not much beyond. Most of the Crimsons will miss
this year’s especially early Easter. But with few grapes in the market we expect to
see Crimsons continue through April in the US$ 18 – 22 range. With Mexico and
Coachella expected to start in mid-May (although that could change), most sellers
will aim to be out of Chilean Crimsons by Week 19.
White Seedless:
Thompson Seedless arrivals will continue strong in Weeks 11, 12 and 13 but, after
that, arrival volumes will drop off dramatically. That will leave the market with
solid, but not excessive, weekly arrivals heading into Easter week. Indeed, the
surge of pre-Marketing order Thompson Seedless that has characterized this
market for the last many years appears unlikely to materialize this season. The
only fly in the Thompson ointment is the high incidence of amber that we are
expecting to see on the late Thompsons. Indeed, the amber may be part of the
cause of lower expected Thompson arrival volumes as amber fruit is being directed
to markets that appreciate amber (or, at least, that don`t punish it).
Today, on relatively light inventories and modest arrivals, the Thompson Seedless
market is strong and gaining strength. Thompsons are being quoted in a broad
range of prices but spot market sales are US$ 16-18 (mostly $18) for 500’s and
US$ 18 -22 (mostly US$ 18-20) for 700’s. There are promotional sales at US$ 16-
18 and amber fruit is also selling in that range.
The price of Thompsons should not soften going forward, as long as arrival volumes
remain in the 1 million case per week range and general condition is not an issue. If
Week 12 and 13 show a volume bump to over 1.5 million cases per week, the market
could soften as sellers try to lighten their inventories. But with a lot of
forewarning by Chilean shippers that Weeks 13 will be the last week of substantial
arrivals (and there has been alot of forewarning), the Thompson market should not
soften dramatically.
Black Seedless:
Today, Autumn Royals are selling at US$ 20-22 for 500`s and US$ 22-24 for 700`s.
Black seedless are selling US$ 18-20 (mostly US$ 18).
Red Globes:
Red Globes continue to be in tight supply and are selling well in this market where red grapes are so hard to find. Red Globes are selling in the US$ 20-24 range, size
depending.