Tighter supplies of oranges in North America

Supplies of California Valencia oranges are somewhat slim right now in California as some shippers are finished and some are re-entering the marketplace.

Some California growers and shippers such as Cecelia Packing Corp. in Orange Cove, CA suspended production in May. “We picked a certain percentage of our crop and the market was somewhat unsettled. Valencia oranges “regreen” and they’re going to have to go through the color enhancement process anyways. So, we decided to just shut down, do some plant maintenance and re-enter the market here in August,” says Keith Wilson with Cecelia.

Photo: Cecelia Packing Corp.

Wilson notes that while some growers have taken this approach, others have wrapped up completely by now for the season. “I think supplies of California oranges are sporadic,” he says, adding that other regions such as Florida’s storage deal and Mexico’s production have likely also wrapped up.

Spike in citrus consumption
Part of the reason for the earlier than usual finish to the season could be the strong COVID-related demand oranges saw happening earlier on when the pandemic hit North America, even with the drop in foodservice demand. “There was some good demand in the marketplace. Early on some of that was driven by the USDA food box programs needing to be fulfilled. It was really good business but there wasn’t much in the way of foodservice at the time because of what has happened with COVID,” says Wilson, noting typically Valencia are a foodservice-oriented product. “Consumers decided they probably needed to increase their intake of Vitamin C and soon after that, the USDA programs started.”

And in the current marketplace, pricing is profitable to the grower for California citrus, says Wilson. “It’s not gone off the charts. It just seems to be fairly steady and more or less where we left off when we shut down for maintenance,” he notes. “As people finish and start again there’ll probably be a fairly good continuity of supply. I don’t think you’ll see that much overall spike in supply. Even when we start, we won’t be trying to push a big amount into the system.”

Tomas Urdapilleta (left) and Frank Telge of Gold Cup Fresh.

Meanwhile imports of navel oranges are currently coming from South Africa and Chile and those began arriving near the end of June. “They arrived to a clean market because there was very high demand for navels. June saw a lack of product and very slow volumes out of California and arrivals from South Africa and Chile came at the end of the month,” says Tomas Urdapilleta of Gold Cup Fresh, a Miami, FL.-based U.S. company that imports citrus through ports on the U.S. East and West Coasts.

High navel pricing
Urdapilleta notes that given the situation, some retailers who had promotions lined up for the early part of July cancelled them over concerns about not fulfilling the volumes on promotions. As for Gold Cup, it is only supplying oranges to its contracted customers and not participating in spot-market sales. Pricing, notes Urdapilleta, is currently high for navels between the high $20s and even into the low $30s.

South Africa will continue to ship until August and that’s when it switches over to shipping Midknight Valencia oranges and Chile will continue to ship until mid-September or even early October.

Photo: Cecelia Packing Corp.

In turn all of this have left some opportunities in the marketplace this summer. “Our first arrivals of Australian navels arrive this week,” says Urdapilleta. “With a good market, we’re trying to develop this origin as regular supplier for our retail programs. We see a good opportunity for the West Coast due the quality and good reputation.”

Other citrus options?
At the same time, he says there have been opportunities for other types of citrus. Urdapilleta notes that some retailers have been open to taking more clementines and have seen some good demand for the fruit.

Gold Cup Fresh packing house in Peru.

“And for Peruvian minneolas, we see this as a good opportunity for them because of that high navel demand. There’s not enough volume to cover it and we think minneolas can help cover that,” says Urdapilleta.

Minneolas will hit peak volumes in the next few weeks and also have spot-market availability.

For more information:
Keith Wilson
Cecelia Packing Corporation
Ph. +1 (559) 626-7411

Tomas Urdapilleta
Gold Cup Fresh
Tel: +1 (856) 491-2022

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