Impact of cold weather

"Consumers reach for soup instead of oranges"

Domestic supplies of oranges are currently in a bit of a wait and see situation.

“Supplies of Navels are strong. We do have a good supply this year. It’s probably a little on the higher end than normal, yet size has been dramatically smaller” says David Hicks of Vegalab Produce in Lindsay, Ca.

Growing has been abundant in California. “We had a really really good growing year early on,” says Hicks. “The yields were so good in December and January that we were kind of behind on fields.”

Matt Brown, Vegalab's VP of Grower Relations in his own field of Cara Caras. 

Wait and see on the rain
That said, growers are waiting to find out the effect of the recent California weather on the crop.

“We have had more rains and freezes this year so it’ll be interesting to see how everything comes through the last couple of weeks,” says Hicks. “We’ve had some pretty extreme weather that could dramatically affect supply. It could put us back in a normal supply vs. demand position. But as of right now, we’re still watching what’s happening. We still have wet fields and cold nights.”

It’s a different scene from last year where there was less of the abundance of fruit that is being seen in this year’s market. While there are other markets producing oranges, Hicks notes that the majority of Florida’s Valencia crop are juicing oranges and there have been concerns over the quality of Mexican citrus.

Right now Vegalab is moving into Washingtons, Cara Caras and late varieties of Navels. “And demand is good,” says Hicks. “Exports are coming in strong now and local demand is decent.”

Weather affecting demand
However, as has been seen across many commodities, the recent cold weather and storms that have affected large swaths of North America have taken its toll on demand. “The whole Northeast has just been hammered,” says Hicks. “So from a consumer standpoint, they’re reaching for soup more than oranges right now. It’s definitely had an impact.”

However now that the cold weather has taken a turn, Hicks notes that the California rains are in play. “So we’re in the position where we’re still trying to find our spot,” he says. “We’re still not at the point where everything is balanced back yet out.”

That leaves any movement on pricing questionable for now. “It’s hard to make a move when you don’t really know what’s going on yet,” he says. “Pricing has been lower than we’ve had in years. There’s just been so much product available and size has not been ideal here. So as of today, we’re waiting and seeing.”

For more information:
David Hicks
Vegalab Produce
Tel: +1 (559) 205-0000

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