Supplies of green beans are really light and have pushed prices up to a reported 10-year high. Why? “It’s the perfect storm,” says Tony Martinez of Primo Trading Services LLC.
That started with light plantings. “Mexico plants light color green beans for domestic consumption and dark green beans for the export market and there’s a lot less production overall,” he says, adding that dark green beans are not essential for Mexico and are not a priority to most farms.
The plantings are also light because of the higher costs. “We saw this light supply coming at the turn of the year for many reasons,” says Martinez. “A lot of people didn’t plant normal volumes and I think the number one reason is cost. In the last two years, people have speculated higher pricing on green beans but costs are the only thing that has gone up in the last two to three years.”
Then there was also the weather. Texas for example should have begun production in April but has yet to start because of rains while production in Georgia also saw rains.
Demand for green beans
Yet, it’s not a higher demand season for green beans, which are largely a foodservice item with some retail as well. Martinez says Primo Trading sees heavier movement of the vegetable from October through December and then January slows down, though in February, demand picks up again given restaurant eating holidays such as Valentine’s Day. “We start slowing down come March because there’s more domestic product. Florida will start going, Georgia and Tennessee start going and then central Texas normally starts around April,” he says.
As for those record prices, they will come down as more of the domestic crop comes on. “Beans are also not a big mover in summer. Even if the shortages continue, they’ll hit the price point--especially in retail--where they’ll pull minimum volumes and then promote something else. Supply will stay snug but if these high price points continue, they won’t hold it. Green beans are just not an everyday item,” he says. He adds that the reality is that post-COVID, people were paying for green beans and other high-value items. However due to economic uncertainty, currently consumers are much more price-conscious about purchases and are looking to stretch every dollar.
Looking ahead, later this year the market could see more of what it’s seeing now. “I think there will be fewer people wanting to plant these high-risk items,” says Martinez. “Q4 could be as volatile as what we’re seeing now. They need to be prepping land right now for Q4 and we’re being offered leases that we’ve never had before because there are fewer people doing it.”
For more information:
Tony Martinez
Primo Trading Services LLC
Tel: +1 (956) 800-4343
tony.martinez@primotradingservices.com
https://www.primotradingservices.com/