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Bernardi: New minimum prices just one of many factors affecting tomato market

“I think the big question out there, is how will the higher minimum prices under the new anti-dumping suspension agreement announced by the U.S. Commerce Department in March,” affect the 2013-14 Mexican tomato season, said Joe Bernardi, president of Bernardi & Associates Inc., Nov. 19.

However, “I think there are so many more factors than just the minimum being implemented,” Bernardi said. “A lot of it depends on how much acreage is planted in tomatoes and Romas,” not just in Mexico but in Florida “for the same time period.”

The primary time when Mexico and Florida compete is February and March, he said. During that time, “you are talking mostly about Homestead [FL] tomatoes, so I don’t know if there is going to be a big increase from there.”

Another major factor, he said, is weather in both growing areas, and “none of us ever know until we get into it, what the weather is going to do.” If there is “any sort of catastrophic weather event, the minimum becomes a moot point anyway.”

01-Nogales-Bernardi-JoeJoe BernardiThat said, Bernardi expects to see less tomato volume out of Mexico this year for the industry than in the past. “From what I understand, from what I am hearing, there is less tomato acreage planted overall,” with a greater decrease in the rounds than in the Romas, he said.

In any case, higher tomato prices seem to have become the “new normal,” even apart from the suspension agreement, Bernardi said. “For going on a year now, tomato prices have been higher than historical prices have been for the like time periods. I am wondering at this point if we have almost gotten used to it, like we have to higher gas prices.”

In the case of tomatoes, it is “not necessarily a bad thing,” he continued. “I’ve always said” that tomato prices in the $8-12 range are “really good numbers for everybody across the board. It allows people up and down the supply chain to make some money” while still keeping end-user prices low enough to “keep consumption up” and thus, “still keep a good amount of volume moving through the system. So that is not a bad thing at all.”

With vegetables out of Mexico, the season seems to get longer every year, Bernardi said. “We are already loading quite a bit of product out of Nogales” such as bell peppers, cucumbers and squash. “We have been loading since early September, which is getting Nogales to be closer and closer to a year-round shipping deal all the time. We were shipping product into early July, and now starting in early September, it has become almost a year-round deal.”

Additionally, “we are seeing more and more of the vegetable products grown in protected culture,” he said. That has been “growing steadily every year.”

Bernardi & Associates, which is headquartered in Nogales, AZ, and has branch offices in California, Texas and Florida, is a full-line broker in the Nogales tomato and vegetable deal.

The company’s sales team in Nogales is the same for this year as it was last year, said Bernardi, who was in the Turlock, CA, office where he has been working the summer and fall California tomato deal, when The Produce News spoke with him. As is customary, he will be going down to Nogales the first of the year for the winter deal. Also in Nogales once again this winter will be Manny Gerardo, Alex Leon and Jose Suarez.

“We have continued to increase volume with our core business,” Bernardi said. “We are very lucky that we get a lot of referral business from customers that have been with us for 20-plus years. That has been real advantageous for us to continue to grow our business.”

The company continues to do “the same things we have been doing,” he said. “We add value to the product out there by having quality control people on the ground, on the back of trucks. I think we have good information regarding volume and what is going on with market trends.” That is a value, “to the receivers that we deal with, and also the shippers that we represent.”