Suppliers are expecting table grape supplies to tighten up as the industry transitions from the southern to the northern hemisphere crop. Fruit arrivals from Chile are decreasing weekly - especially on green seedless - and Mexico is not due to start shipping promotable volumes until well into May. This follows a period of relatively stable supplies. However, according to Ira Greenstein of Direct Source Marketing, the USDA Marketing Order which came into effect on April 10 is having an impact on arrivals.
"All inbound Chilean Seedless shipments must meet US #1 upon arrival, leaving growers unlikely to ship anything but excellent quality fruit," Greenstein said. "There will still be a fair amount of Crimson Seedless entering the market for the next 7-10 days, but overall black and green seedless arrivals will decline rapidly through the balance of season. Although a heavy crop of seedless table grapes is hanging in Hermosillo and Caborca Mexico, the industry isn’t expected to see any meaningful volume until the third week of May. Importers will do their best to stretch Chilean supplies until then, but there is a real concern that we could see extremely light supplies on green seedless."
Green seedless supplies likely to be exhausted
Reports are that Chilean green seedless grapes are varying in quality. Some of the fruit is of premium storage-quality while other fruit is poor to average quality and needs to be moved quickly. As a result, the market is split with a wider spread of prices being quoted. "Pricing on fair quality green seedless currently ranges from $24-$28 on medium/large, $28-$30 on large and $30-$32 on x-large," Greenstein noted. "Importers with premium quality storage lots are asking anywhere from $34-$38 with size and condition being the determining factors."
He also warned that supplies of green seedless are likely to become very tight until Mexico can start to ship some decent volumes. "The industry will surely exhaust overall supplies of green seedless before early volumes begin crossing from Mexico. Look for spot market pricing on green seedless to continue to tick higher week by week with FOB’s eventually reaching the $40 mark."
Good supplies of reds, but black seedless almost done
A similar observation can be seen on black seedless grapes, whereby supplies are set to become scarcer over the next few weeks. The USDA Marketing Order is at play here too, with importers suggesting declining quality will discourage shippers from sending any more fruit from South America. Prices are increasing as the availability tightens.
"Growers and shippers usually do not ship fruit past the USDA Marketing Order because the Autumn Royal variety is susceptible to shatter and will not make US #1 on arrival," Greenstein explained. "Overall availability has begun to tighten with FOB’s adjusting higher week by week. Pricing for good quality black seedless currently ranges from $28-$32 with the market trending higher. Look for supplies to be available for another 7-10 days as the industry moves through the last volumes of the season."
Red seedless varieties are in more plentiful supply, and Red Globes are starting to arrive from Chile now that the Peruvian season has ended. Suppliers say one of the reasons there are more red table grapes in the US market at the moment is due to more unstable markets in Asia and Europe, meaning that Chilean growers have opted to send more volume to the United States. As a result, the market is steadier on reds for now.
"Importers will continue to offer aggressive FOB’s in order to keep fruit moving through the system in a controlled fashion," Greenstein observed. "General pricing on Crimson Seedless currently ranges from $16-$18 on medium/large, $18-$20 on large and $20-$22 on x-large. There are decent supplies of proprietary red seedless varieties such as Jack Salute, Allison and others with pricing ranging from $20-$24 depending on size, condition and importer. Many importers have locked in promotional program pricing through the end of the month, which could prompt some of them to ask for higher pricing on spot market sales."