The South American table grape supplies have mostly been cleaned out of the market, and US supplies are currently coming from Mexico and Coachella, though the volumes coming out of Mexico haven’t been as high as they should be in the past weeks.
Ira Greenstein of Direct Source Marketing says: “Lack of sugar on green seedless and color on Flames have set the table for strong spot market FOB’s, but we are likely to see significantly more fruit crossing by the end of the week. It certainly looks as if we are heading to a repeat of last season with compressed volumes arriving in June and July. I would expect marketers to try and hold onto the last high spot market sales early in the week but with aggressive retail programs in place and 17 million boxes to sell, we should see pricing drop below $20 by the 8th of June.
Mexican Flame crop 2 weeks behind
Excessive heat in Hermosillo has caused a delay on the Mexican Flame crop, which is currently about two weeks behind schedule. “Marketers have been scrambling to fulfill their program commitments, and for the second year in a row Chilean supplies of Crimson, Allison and Scarlotta filled the gap while waiting on Mexico to get started. Interestingly, spot market FOB’s for Chilean fruit in May never saw the spike that we would have expected. Clearly our current health and economic crisis has had an impact on the table grape industry,” says Greenstein.
While the spot prices are currently quite high for the red seedless grapes, they’ll like decrease in the coming week because many programs are locked in at lower prices. Greenstein explains: “Mexican Flames currently range from $24.95-$28.95. Some growers had good volumes of Sweet Celebrations last week and fruit moved pretty easily at $28.95. With so many programs locked in ranging from $18.95 - $22.95, marketers will certainly start dropping the spot market to be more in line. If volumes still hanging come as compressed as we expect, we’ll look for FOB’s to drop well below $18.95 by the 15th of June.”
Slow start to green seedless
The amount of green seedless in the market is currently at quite low levels, which has kept pricing high. “We saw steady crossings of Early Sweets, Primes and Perlettes last week but it was not enough to cover spot market demand and committed programs. As growers continue to fight sugar, FOB’s have remained elevated. Typically, during the first week of June, green seedless pricing would be ranging between $16.95-$20.95, but with such a slow start we won’t see those levels for another 7-10 days. Programmed pricing is still lower than the daily spot market, but marketers will have to find a balance very soon as production begins to ramp up.”
“Spot market pricing on Mexican Perlettes ranges from $18.95-$22.95, and Primes and Early Sweets range from $22.95-$26.95. This week, the FOB’s will likely adjust a bit lower on premium fruit as more product should become available. As the temperatures in Hermosillo could continue to have an impact, the market could be kept at close to these current levels,” Greenstein adds.
Flat market for black seedless
While the supplies of black seedless grapes such as the Mexican Summer Royal have been steady, the demand hasn’t been very high, which has left the market relatively flat. “Overall condition and quality have been very good but there seems to be a wide range of sizing available. Spot market FOB’s range from $18.95 - $20.05 on large fruit and $20.95 - $22.95 on premium extra-large lots. As retailers look to more high-profile commodities to promote, we should see overall pricing adjust lower over the next two weeks. Even as we get to $16.95 it is unlikely to see any significant promotional activity on black seedless,” Greenstein concludes.
For more information:
Ira Greenstein
Direct Source Marketing
Tel: +1 (914) 241-4434
Email: ira@directsourcemktg.com
https://www.directsourcemktg.com/