Lime suppliers in the US are warning that prices are expected to rise as volume crossing the border decreases. They say that seasonally poor weather is causing a dip in production and there is simply less fruit available for crossings. As a result, prices are creeping upwards, a trend that is expected to continue over the next few weeks.
"Right now, we are seeing a tightening of lime supplies as production is hampered by rain and colder weather in Veracruz," said Jose Duran of La Minita Fresh in McAllen. "It is normal for this time of year to see a shortage of fruit crossing into the US. Right now, prices for 110s are $12, 150s are $14, and 175s - 230s are $16 - $18, all FOB McAllen. This is up by about a dollar to two dollars from last week and prices will continue to climb through the month of February."
"There were two hurricanes which affected the region last year," he added. "This resulted in a shifting of the growing season a little."
Demand is rising, but growers not keeping up
One of the reasons for the shortfall in supply to the US is the strong demand for limes - particularly smaller sized fruit. Combined with the observed slowdown of fruit crossing the border, this has helped create the tight market right now. According to Duran, growers are not keeping up with the long-term strengthening in demand.
"There is simply a growing demand for limes in the US," he said. "At this time of year, it's normal for supplies to slow down, but each year consumers keep buying more and growers are not keeping up. The strong demand is creating a shortage each winter."
Duran also noted that the reported fuel shortages have not affected them. "It's all political," he says. "We have not felt any effects because fruit is still arriving at the border without issue."
New packing equipment close to the border
La Minita Fresh has been packing their limes at the source and also in bulk containers. However, the company recently invested in some new packing machinery at their border facility in McAllen, which they said allows for more flexibility.
"We mainly use the conventional 10lb and 40lb bags," Duran shared. "This year, we invested in the purchase of new packaging machinery that enables us to pack in configurations of 1lb, 2lb, 3lb, and 5lb consumer packs. This is what more retailers are looking for and the new machinery enables us take these orders right at the border."