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Russet potato shippers seeing good demand

WEATHER

Daytime temperatures in Yuma, AZ, were expected to reach the low 80s through Feb. 25 before easing into the mid-70s through Feb. 28. Overnight lows were expected to range in the mid-40s to low 50s. Rain was not in the near-term forecast.

In Oxnard, CA, daytime temperatures were forecast to reach the low to mid-70s through Feb. 23 before dipping into the low to mid-60s through Feb. 28. Overnight lows were predicted to be in the upper 40s to low 50s. Rain was not in the near-term forecast.

Daytime temperatures in Bakersfield, CA, were expected to be in the low 70s Feb. 22-24 and the low 60s Feb. 26-28. Overnight lows were expected to be in the mid-40s through Feb. 24 and the upper 30s through Feb. 28. Rain was not in the near-term forecast.

 

DEMAND

Row crop shippers were seeing the unprecedented stretch of minimal demand they have experienced since the holiday season. Strawberry and russet potato shippers were seeing continued good demand, while onion shippers were facing light demand.

 

TRANSPORTATION & FUEL

Trucks are plentiful in California and Arizona, and rates are steady. Crude oil prices were unchanged Feb. 22 at $106.25 per barrel, which is 28 percent below record levels of July 2008.

The nationwide average price for a gallon of diesel the week of Feb. 20 was $3.96, which is 11 percent higher than one year ago. The average price in California for a gallon of diesel is $4.26, or 12 percent higher than last year.

 

STRAWBERRIES

The recent winter challenges of freezing temperatures in Florida and rain in central Mexico are fading. Florida’s production is now slowing and fruit sizes are falling. The rains in central Mexico have eased considerably and production is beginning to improve.

Ideal growing conditions in Southern California are aiding early-season production. Assuming continued good weather, Oxnard shippers expect production to increase significantly by the week of March 12. Good availability of high-quality fruit from Oxnard is two to three weeks away.

 

ICEBERG LETTUCE

Iceberg lettuce from the California and Arizona deserts is free of epidermal peel and overall quality is excellent. Today’s lettuce offers good weights, color and shelf life upon arrival.

Ideal growing conditions over the past several weeks have produced an overabundance of lettuce. The near-term forecast in the desert called for daytime highs in the low 80s through Feb. 25 before easing into the mid-70s through Feb. 29. Overnight lows were expected to be well above freezing, in the mid-40s to low 50s.

But the big story is the lack of demand.

A Yuma lettuce salesman recently stated, “Historically, the slowest demand period of the year is the week between Christmas and New Year’s Day. Demand has been that light since the holiday season. I’ve been in the business for 25 years and have never seen such a long stretch of minimal demand. I know it’s not the case, but it seems as though receivers just don’t care.”

For now, late February into early March will be an excellent time to highlight high-quality Iceberg from the Southwest desert at very reasonable prices.

 

LEAF LETTUCE

Leaf lettuce from the California and Arizona deserts is free of epidermal peel and overall quality is excellent. Romaine, Green Leaf, Red Leaf and Butter lettuce offer good color, weights and shelf life upon arrival. The mild weather forecast through at least Feb. 28 should ensure the continuation of high-quality leaf into late February and early March. Today’s leaf markets are very reasonable and should remain as such into the week of Feb. 27. This is an excellent time to highlight high-quality leaf lettuce from the Southwest desert.

 

RUSSETS

Consumption of russets from processors has always been noticeably larger than the fresh industry. Processor purchasing habits continue to have a significant impact on the price of fresh russets paid by foodservice distributors and retail outlets.

Processors (including dehy and flakers) like to keep a 60-day supply of russets on hand, and they started this season with only 20 days’ worth. Processor demand has been above normal since the autumn and today they continue to build their supply base. As an industry, processors are secretive and do not disclose their near-, mid- or long-term needs.

Fresh shippers can only speculate and the current consensus is processors will procure a substantial amount of open market russets. But when? Tomorrow? Next week? Next month? Late spring? The exact timing is unknown, but the speculation of a pending purchase has created a bullish undertone in the fresh russet market.

Idaho russet supplies in storage are down 10-15 percent from the 10-year average. Combine this shortfall with the speculation of stronger processor demand, and the result is an increasing likelihood of rising prices heading into in the spring. Idaho packingsheds are slowly but surely switching from Norkotahs to Burbanks, which have a smaller size profile. As a result, prices of the larger carton counts will rise faster when the general market eventually pushes higher.

Shippers were seeing good retail bale demand for February’s Potato Lover’s Month. Current carton prices are reasonable, but shippers sense the carton market will push higher beginning in March. Now is a good time to build your carton inventories.

 

BROCCOLI

Ideal growing conditions, light demand and ample supplies have created a very reasonable western broccoli market. Prices are very attractive and quality is excellent from Yuma, the Imperial Valley and Blythe.

Buyers can choose from a full array of packs, including plentiful supplies of Asian-cut broccoli crowns. The near-term weather forecast called for continuing ideal growing conditions well into the week of Feb. 27. This is an excellent time to highlight broccoli from the Southwest desert.

 

CELERY

Ideal growing conditions, light demand and ample supplies have created a very reasonable western celery market. Prices are very attractive and quality is high from Oxnard and the Southwest desert near Yuma.

Buyers can choose from a full array of sizes in both shipping areas. The near-term weather forecast suggests that growing conditions would continue to be excellent well into the week of Feb. 27. Late February and early March will be an excellent time to highlight high-quality celery from California and Arizona.

 

ORANGES

Very mild and dry winter conditions were expected to continue in California’s Central Valley through at least Feb. 28. Navel quality is superb and production is running at full capacity. Color is naturally full color with Brix between 11 and 12. Packouts are 75 percent Fancy and 25 percent Choice. Peak sizes are 88s followed by 113s then 72s. Sizing will gradually increase into March. The market is reasonably priced and this remains a wonderful time to highlight Navel oranges from California.

 

LEMONS

Desert lemon production had been down as much as 75 percent this winter season due to the harsh freeze in February 2011. The desert lemon season started this past October instead of early September, and is concluding now instead of late March. Yuma and Coachella, CA, packingsheds are done for the season. This early conclusion should stabilize the market and/or push prices moderately higher into March. Trucks now have to load lemons in Oxnard or California’s Central Valley.

 

Bill Armstrong is a self-employed produce broker who operates Armstrong Marketing in Salinas, CA. He may be reached by phone at 888/484-0800 or by e-mail at ArmstrongMarketing@-comcast.net.

Contrary to industry predictions last autumn, yellow and red onion prices have been depressed for many, many weeks. The yellow and red onion markets have been so low since the holidays that processor contracts are noticeably higher than the open market.

There seems to be a faint light at the end of the tunnel. Currently, shippers say that the sloppiness at the bottom end of the red and yellow markets is beginning to firm. It’s hard to pinpoint, but it’s likely increasing shrink rates, slightly improving demand or both. Only subtle changes are expected in the near term.

In the longer term, prices have been so low for so long that there is only one direction the market can move — up. This remains an excellent time to buy yellows and reds because, frankly, the markets can’t move any lower and overall quality is excellent.

The Ontario, OR, onion season is expected to continue into late March or early April. Washington state shippers will continue into mid- to late April. The domestic Texas season should start in early to mid-March.

 

Bill Armstrong is a self-employed produce broker who operates Armstrong Marketing in Salinas, CA. He may be reached by phone at 888/484-0800 or by e-mail at ArmstrongMarketing@-comcast.net.