“The supply of grapes is too high—it’s higher than last year,” says Mario Macias with Mario Macias & Co. in Bakersfield, Ca. “There’s too much volume.”
Part of the problem is the import market. “Chile was later this year--and in the future Peru will have later supplies—and both countries are planting new varieties. And Mexico is starting sooner because they are planting in other regions in Mexico.” On top of that, Macias notes that Mexican growers have also heavily expanded the varieties of grapes they grow. “There are many new ones, private company varieties from special breeders,” says Macias.
Domestically, Macias says that the Coachella region is off to a slightly later start this year ranging anywhere from four to eight days later.
As far as demand for grapes, both retail and foodservice has solid demand though foodservice is still contending with Chilean red seedless grape supplies. “And consumption will be good if retail lowers the prices,” notes Macias.
He points to pricing variation and the range they spread depending on the variety involved. “New varieties are up $3.00 to $5.00 higher than the older varieties and there are many new varieties in white and red seedless grapes,” he says. “The older varieties are phasing out.” That said, the new varieties are holding at stable pricing.
Also factoring into the pricing are labor costs. “There’s a big difference in the labor costs between Mexico and Coachella. In California, the minimum wages are increasing every year and Coachella will have a very hard time competing with that,” says Macias.
Looking ahead, Macias sees big promotions coming on black grapes out of Mexico with lower pricing as well as big volume on flames, also carrying lower pricing and also out of Mexico.
For more information:
Mario Macias & Co.
Tel: +1 (661) 368-3077