Prices on limes from Mexico could stay flat or drop following heavy imports and low impulse on the retail side. "The USDA crossings have been relatively high. Last week, Texas, Arizona, and California crossed 700 loads, which is a lot," says Tony Martinez of Primo Trading Services LLC. "High crossings are also expected this week, so there's plenty of fruit coming out of Mexico."
What is behind this increased supply? Lime-growing regions such as Veracruz are coming off at least three years of drought conditions. "This year has been a rain year and the bloom is set and the rain is accelerating the growth," he says, adding that while now the supply is predominantly small/medium sizes, it will move into the mostly medium/large sizes in the coming weeks.
There are a few other factors influencing pricing, notably that August is also a transitional month for lime supply. "It's when the older crop is heading out the door and the new crop is phasing in in September," says Martinez. "This year, because of all that rain accelerating growth, we may see that transition sooner, and we will also see quality issues increase sooner than expected."
© Primo Trading Services
Slower time for lime demand
This plentiful supply also comes at a time when demand softens for limes, particularly so post 4th of July holiday. "After the holidays is when the retail promotions slow down for many produce items, limes being no exception," says Martinez, adding that around August 20th, depending on how consumption is looking for limes, is when retailers start preparing promotions for another key summer holiday–Labor Day and 16 de Septiembre (Mexican Independence Day) promotions.
Then, looking further ahead, after September 16th, there are virtually no promotions on limes, given that's when retailers are more interested in promoting fall items such as pumpkins. "Until then, I see consumption continuing to drop, and if retailers are not promoting, consumption will stay flat," says Martinez.
Meanwhile, Colombia continues to supply fruit to regions such as the Northeast and Southeastern U.S. regions. The country also continues to work on increasing its share of the lime market and its role as a market disruptor on Mexican limes.
For more information:
Tony Martinez
Primo Trading Services LLC
Tel: +1 (956) 800-4343
[email protected]
https://www.primotradingservices.com/
