Supplies of lemons remain strong as the import period of the fruit winds down.
“There are some limited supplies from Chile, Argentina and Mexico on the market but those will continue to close out by the end of December,” says Hans Weaver of Earth Source in Ephrata, PA. “Then we’ll rely mostly on the domestic market for lemons until the import season begins again next year.” The majority of lemons domestically come from California and Arizona.
Hans Weaver of Earth Source.
For now, supplies are meeting demand for lemons. “But with the rising COVID-19 cases, we’re keeping our eye on consumer trends regarding going to the grocery store versus going out to eat and how we may start shifting back towards what we saw in March and April,” says Weaver. “If COVID cases continue in the U.S. and the government continues to look at either closing schools or implementing more restrictions that we saw earlier on in the year, I expect consumer demand trends to mimic what we saw in March and April.” He adds that the company’s almost daily conversations with its growers and its own internal analytics will help Earth Source navigate this next period as much as possible.
Changes in demand
That increased demand at retail also caused movement in what types of lemons were available. Retailers have different requirements than foodservice requirements for lemons in terms of type and sizing—namely, they prefer larger fruit that’s Fancy grade compared to the Choice grade of lemons used in foodservice. (And while some retailers have broadened their requirements, many have not.) “Farmers have all sizes and quality of fruit and we’ve moved into the era where the opportunities to move a certain size of fruit are more limited because of what consumers demand. It’s a challenge we’re continuing to navigate,” says Weaver.
Also factoring into the unusual year were shipping container challenges. “Earlier in the year when we’d normally receive a lot of our citrus during the summer from South America, a lot of exports were going from Chile/other South American countries to Asia. And the cherry containers going to China at the beginning of the pandemic were getting stuck within Asia. That caused the hold up in the beginning and impacted the cold supply chain,” says Weaver. “We were worried about disruptions to the supply chain early on in the year. But now a lot of those concerns have been negated and I’m not concerned about those supply chains from a transportation point of view.”
Pricing to go up?
So where does all of this leave pricing now? Pricing is within historical norms but may not stay there. “It will be interesting to see what happens in the coming months as we rely mostly on domestic fruit. Throughout the whole pandemic, within the U.S., we’ve had the luxury of being able to import lemons from other countries to alleviate demand and make sure prices don’t skyrocket,” says Weaver. “These next three to four months will be the first period during the pandemic where the U.S. will rely primarily on domestic production.”
Imports from Northern Hemisphere countries begin in the coming weeks and Weaver notes it will bring in lemons from Turkey this year into the Northeast market. “We also anticipate pricing will allow for Spanish lemons to come into the East Coast, even with the 25 percent tariff implemented last year by the Trump administration.”
For more information:
Hans Weaver
Earth Source
Tel: +1 (877) 321-8200
hansw@earthsourcetrading.com
https://www.earthsourcetrading.com/