Salinas, CA: Daytime highs will briefly reach the mid-80s May 4 and 5, then quickly retreat to the low to mid-60s through May 10. Overnight lows will be in the mid- to upper 40s.
Bakersfield, CA: Daytime highs will briefly reach the low 90s May 4, 5 and 6, then slide back into the mid-70s through May 10. Overnight lows will be in the mid-60s through May 6, then drop into the low to mid-50s through May 10.
Row crop shippers were seeing moderate demand on most key items. Carrot shippers were seeing continued strong jumbo and plug demand on limited production.
TRANSPORTATION & FUEL
Freight rates from California increased in late March with the shift of shipping districts from the desert north to the Salinas Valley. Truck availability will tighten and rates will rise further in early to mid-May with the start of California's stone fruit, grape and melon seasons.
The price of crude oil fell $2.05 May 4 to $109 per barrel, which is 26 percent below record levels of July 2008. The nationwide average price for a gallon of diesel the week of May 2 was $4.12, which is 32 percent higher than one year ago. The average price in California for a gallon of diesel is $4.46, which is 37 percent higher than last year.
The transition from California's Central Valley to the Central Coast is complete. Lettuce supplies now will come from the Salinas Valley and Santa Maria into mid-October. Initial quality from the Salinas Valley has been strong with good color, weights and shelf life. The market has been reasonably priced since the Salinas season started in mid/late April.
A short-lived hot spell will raise Salinas Valley daytime temperatures into the mid-80s May 4 and 5. Daytime temperatures will drop 20 degrees by Sunday, May 8, which is forecast to have a high of just 63 degrees. Shippers are not concerned that the heat will produce any significant tip burn. A Salinas Valley lettuce salesman recently stated, "Any issues brought on by the brief heat spell will be more than offset by plentiful supplies."
The near term lettuce market heading into the week of May 9 is expected to hold fairly steady. Buyers can expect good quality throughout May. This remains a good time to highlight Iceberg from California's Central Coast.
Romaine and green leaf have completed the transition from the Central Valley to the Central Coast. Romaine supplies are ample, overall quality is strong, and the market has eased recently to reasonably priced levels. The green leaf market remains robust and is priced noticeably higher than Romaine. Despite expensive prices, green leaf quality is strong with good shelf life. Green leaf prices are expected to ease into the week of May 9 and settle closer to the Romaine market. A few shippers said that leaf from New Jersey will be ready soon.
The broccoli market has been inundated with ample supplies since mid/late April. The current warm spell will foster continued good supplies through May 7. For every glut there is a gap, and sooner or later, today's excessive supply will reverse course.
Broccoli prices are about as low as they can go, so the only way the market can swing is higher. Much cooler temperatures are expected by May 7, and this will likely be the turning point which produces lighter supplies and triggers rising prices.
The celery market has increased considerably since late April. Prices will continue to rise into the week of May 9 and remain stout through the month of May.
The market is rising for two reasons. First, the much anticipated seeder problem in Oxnard has arrived in full force and is reducing yields. Seeders are produced when celery begins its reproductive phase and pushes up from the inner stalk to produce seeds. Seeders are allowed to be two-and-a-half times taller than the bottom width of the celery stalk. Excessive seeders are not marketable, hence growers harvest their fields early before the seeders exceed the allowed standards. Second, shippers are in a production gap caused by the heavy winter rains which prevented growers from planting their fields on schedule.
New-crop celery is slated to start in Santa Maria around May 13-20. Shippers predict that they will combat seeders from the beginning. The Salinas celery season will start in early June. Buyers can expect high prices and a seller's market through May.
The California strawberry harvest has slowly but surely marched north from Oxnard to the Salinas Valley. Foodservice buyers can load strawberries in Oxnard, Santa Maria, Salinas and Watsonville. Fruit quality from Salinas, Watsonville and Santa Maria is exceptional with good sizing, deep color, a glossy sheen and lengthy shelf life after delivery.
The Mother's Day pull is over, and the near-term market is expected to ease modestly into early/mid May. A two-tier market may develop as shippers in Oxnard and Santa Maria attempt to lure both orders and trucks away from the Salinas Valley.
Texas onion supplies are beginning to fade and will fall noticeably further the weeks of May 9 and May 16. Production from California's Imperial Valley is rising and will compensate for the decline in Texas. Imperial Valley shippers will reduce their f.o.b. prices accordingly to compete with Texas shippers in Eastern markets. Initial quality from the Imperial Valley is strong. The near-term jumbo yellow market is expected to hold fairly steady into the week of May 9. The jumbo red market is gaining moderate strength as Texas winds down and California supplies have not yet reached full production.
Looking down range, New Mexico and Huron, CA, will begin around June 1. Rumors are flying that the front end of the New Mexico deal will be plagued with light yields and undersized onions. The early February freeze brought overnight temperatures between zero and 10 degrees in the onion-growing districts. Onion tops in countless over-wintered fields fell and did not recover. A New Mexico salesman recently stated, "We knew onions were in trouble when the cold temperatures killed some palm trees."
Trucks availability is limited, and fuel is expensive. Buyers are encouraged to stay ahead of inventories and load trucks as they become available. Flatbed trucks are the preferred mode of transportation because the highway wind whistles through the load and keeps the respiring onions dry.
Through March, the mantra for the 2010-11 Idaho Burbank crop had been "a lack of size." The market structure over the past several months offered price breaks from 70s to 80s and again from 80s to 90s. Slowly but surely, the foodservice trade shifted demand to these more reasonably priced carton counts. Today's good availability of large Burbank cartons has caught shippers somewhat by surprise. A salesman for an eastern Idaho shipper recently stated, "We offer both Norkotahs and Burbanks from August to March, then rely on Burbanks into July. The Norkotahs offered more size all shipping season, and we expected the Burbank profile to be heavier to the mid cartons. It will vary from cellar to cellar, but the Burbank crop has more size than first thought."
The heavy Easter pull by retailers on consumer bales generated high carton inventories, and many Idaho sheds were flush with cartons in mid- to late April. The Idaho market on 70-count and larger cartons has eased over the past few weeks and is now more in line with Colorado and Washington state. Deals are available for volume purchases on large cartons.
The post-Easter decline in consumer bale demand was expected and should rise to normal levels the week of May 9. Idaho shippers expect continued good carton supplies into mid-May and possibly later. Overall supplies in Colorado are light, and several shippers will conclude their seasons in late May, which is one month ahead of schedule.
Demand and prices historically rise through the spring months. Overall lemon supplies are fairly tight, and the longer term market will slowly but surely push higher. Sizing will gradually increase as the summer months approach. Prices are firm at current levels and are on the verge of more increases in May. Overall quality is strong. Lemons are available to load in Oxnard and the Central Valley, and can load together with oranges.
The pending variety change from navels to Valencias is approaching. California Valencias are now available in light quantities and are mainly going to export. Production will increase weekly into late May. Valencia prices are currently the same as navels. Valencia sizing will begin heavier to the smaller foodservice sizes, and prices of Valencia 88s and smaller will fall below navels by mid- to late May. Navel oranges are available for loading in the Central Valley followed distantly by Oxnard and Riverside. Oranges and lemons can load together in either district. For now, foodservice buyers are encouraged to stay with navels and review the variety switch week by week.
Amazingly enough, California carrot shippers continue to struggle with undersized carrots and light production caused by the cold winter and hard freeze in early February. A salesman for a large California shipper recently stated, "We will continue to harvest in the desert into late May. We started the Bakersfield harvest the week of April 18, three weeks early, which improved supplies on the baby whole peel carrots. The availability of jumbo and large plug carrots will remain light into mid- or late May. Availability will return to normal by June 1." Shred carrots and carrot sticks will remain limited into mid-May because they are made from plug carrots.
(Bill Armstrong is a self-employed produce broker who operates Armstrong Marketing in Salinas, CA. His column appears here every Wednesday afternoon/Thursday morning. He may be reached by phone at 888/484-0800 or at ArmstrongMarketing@comcast.net.)