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Market Watch

Pacific Northwest Crop Update

December 2017

  • Rhubarb: Interpack's #1 processor/supplier of IQF ½" cut rhubarb says they are sold out. Some IQF diced seems to be available however.
  • Strawberries: Final numbers out of California..down about 16% from the last two years. Interpack continues to hear the prediction that Mexican prices will be higher than last year. Seems there's been a recent run on what's left of the organic stocks. New crop Turkey & Mexico are next....then California right behind them.
  • White Grape Market: Some customers are asking why prices for white grape are up. Further to last month's report re one of the worst crops in years with yields down about 32%.... a report published by Spend Matters in late November indicated raisin prices...which compete for Thompson seedless grapes with the juice processors... were up about 50%.
  • Cranberry industry "bailout": Further to our September report about the mandatory USDA set aside and our November report re the USDA order to literally dump 15% of this year's crop and 25% of next year's crop: the "Twilight Zone" continues for the cranberry industry with the Seattle Times reporting cranberry processors have requested the OK to utilize the "excess fruit" as fertilizer and were "anxiously awaiting government approval."
  • Wild Blueberries: The AP reported November 10th production in Maine dropped to 65 million lbs vs last year's 102 million lbs. Overall wild production...Quebec being the biggest producer... was expected to be under 300 million lbs...a drop of more than 100 million lbs from last year's 400 million lbs and somewhat lower than 2015 and 2014. "Lack of rain and lack of farming effort" motivated by low prices were cited as two causes for a smaller crop.
  • Trucking Alert: Further to last month's Trucking alert – Part I – Electronic Logs Mandate: One trucking company told Interpack, "500 miles a day will be the new standard (if they don't get held up at shippers/receivers for long) where as of now drivers are doing 600-700 miles per day." The effects of this new mandate seem extraordinary. Carriers are telling us the total cargo they can move per week as a company is dropping drastically so they are currently in the process of determining which customers, which traffic lanes and type of business...LTL vs straight loads for example... they will continue to serve and which ones they will have no choice but to drop. Another trucking company told Interpack, "We are seeing many owner operations, trucking companies closing shop due to this because they will not be able to pick up as many loads each week which will result in less money for them. The carriers that do stay around will be demanding higher rates due to the fact that they will not be able to haul as many loads each week." Yet another trucking company told Interpack, "We will shy away from facilities that hold drivers up for extended periods of time or are extremely rigid with available appointment days/times because the drivers will not be able to work around that the way they have in the past." Another trucking company told Interpack, "We have adjusted our routing to accommodate this pending change." Freight rates are expected to be affected. Team drivers are expected to be in very high demand, and some believe will cost a major premium to secure. Some believe it is unlikely for anything more than 2 to 3 picks to be of interest on team loads. A likely new trend will be for single drivers to load product and pass off to a team. Solutions? We are asking whether planning further ahead will help shippers and it seems it is not a cure and may not always work. One company contacted by Interpack told us they are looking into creating their own in-house trucking company to support their core business. Some are looking at intermodal..i.e. truck on rail...for cross country shipments. Other factors influencing the availability of trucks are weighing on the industry...such as the average age of truck drivers and the lack of young people becoming drivers and the general economy...increased activity at cold storages across the country seem to be at capacity so getting appointments to pick up and deliver is getting more and more difficult.

Pacific Northwest crop

August 2017

  • Reports of short crops have come in all over the Pacific NW and we've seen seriously delayed pricing. It is August and many blueberry processors have not sold a single lb yet. One Oregon blueberry processor announced a 50% pro rate for all regular customers. Many processors are off the market as of this posting. Black raspberries were a challenge...somewhere around half a crop....prices for straight pack and IQF are up....puree is down due to a carryover. Blackberries look to be about a half crop and prices are coming out approximately $ 0.40/lb higher than last year. The red tart cherry crop in Oregon is about 40% of average and new crop here is sold out. The dark sweet cherry crop looks good but one processor is sold out. Unclear at this writing how sales are going for red raspberries but the overall crop was definitely down and yet IQF prices are also way down.
  • California crop: Apricots did much better this year but are sold out...except maybe apricot puree 32° and some single strength puree are still available. Peaches seem to be on an even keel.
  • Dark tart cherries - Europe: Received the following from a customer...asking about our cherries, "Poland has had a crop failure and their price has escalated."
  • Cold storage figures: Looks like US cold storage comparisons with last year are misleading because the crops are so much later than last year....In a month or two we'll have a better feel. For example last month we reported blackberries, "30 year high and 22% higher than last year" and this month, "Above average and 32% lower than last year" mainly because last year was early and this year is late.
  • California strawberry market: We've seen dramatic declines in strawberry prices in California this year...both conventional and organic.
  • Mango crop – Mexico: Things are winding down in Mexico. So far the season seems to have turned out pretty well.
  • Apple market: Interpack received numerous indications of shortage over the last month or so...for apple juice and frozen apples and sure enough apple prices have spiked. Juice concentrate prices, however, seem to not have been affected. Some see this as temporary and that prices should return to normal come new crop. The cause seems to be at least partially because the 2016 crop had above average quality so the percentage of apples that are ending up as peelers and juice is below average. The shortage was reportedly exacerbated when fresh packing houses switched to cherries. The USDA reported prices for peelers in April at mostly $ 140 - 150/ton vs July at $ 160 – 180/ton and juice apples in April $ 20 – 25/ton vs July $ 60 – 80/ton.
  • "Clean labels": Interpack continues to hear reference to "clean labels".....that customers want ingredients that allow them to have "clean labels" on their products. Seems that the definition of what constitutes a "clean label" is anyone's guess. Some believe it means, "all natural" and/or "non-GMO" and/or "no additives or preservatives" and/or "sustainably produced" and/or "minimally processed" and/or "made with real ingredients" and/or "a small number of simple, easy to understand ingredients" and/or "no added chemicals" and/or "healthy". Whatever a "clean label" is...it seems consumers want them.

Pacific Northwest crop update

June 2017

  • Snowpack is above normal so the irrigation water supply for tree fruit in the Yakima Valley looks good. Weather has been cooler and wetter than usual so timing of the crop looks to be closer to normal vs last year's early start.
  • The dark sweet cherry crop looks big. With some dark sweet cherry inventory carryover and the look of the tree fruit crop in general price trends are expected to be horizontal or perhaps even slightly lower than last year's already lower prices.
  • Strawberries in Oregon look to start almost three weeks later than last year...a little later than average...but around June 10th.
  • Blackberry crop: most in the industry are expecting yields to be down from last year. Just how much will depend on the weather.
  • Interpack visited a big grower of rhubarb the week of May 22 right after harvest began the previous weekend and the grower reported color better than last year. The crop is two to three weeks later than normal and about a month later than last year. The same rhubarb grower also reported that there is significant damage to his blackberry crop.
  • Blueberry growers in British Columbia reportedly say the crop is 4 weeks later than last year. Interpack heard one of the big club store chains has switched from frozen cultivated to frozen wild blueberries for all stores in the eastern half of the country. So the weakness in the cultivated market is being exacerbated by what appears to be an oversupply of wild blueberries.
  • California strawberries: Production picked up in late April and has been going strong ever since. Through the week ending May 27 deliveries of Grade No. 1 fruit to freezers is slightly ahead of last year but pretty far behind two years ago. June and July will tell the story.
  • Apricots: Season looks to be set for a normal start...around mid June and finishing up very early July. Crop prospects for frozen bulk industrial volumes look better than last year.
  • Raspberry market: Word out of Europe is that their crop is down approximately 25% from either normal or last year...not clear at this writing...but down. Interpack received an April photo of a raspberry field in Serbia totally snowbound.
  • Organic...really? The Washington Post published an analysis by M. Jason Kuo, a postdoctoral fellow at the Mortara Center for Int'l Studies at Georgtown University, detailing the challenges faced by the USDA when dealing with fraudulent organic certification handled by third-party certifiers in off-shore countries. Interpack has received multiple reports of off shore origin certified organic food products that turn out to not actually be organic.

Pacific NW crop prospects

May 2017

Rhubarb in the field

Oregon rhubarb being harvested in late May.

  • Rhuburb is harvesting in Oregon and color looks to be better than last year. Yield expected to be average and price similar to last year.
  • Winter damage is starting to show up in Marion blackberry fields in Oregon. The Willamette Valley is over 19 inches ahead of average for rainfall and temperatures have been cool which also concerns growers. Don't expect a bumper crop this year.
  • Blueberries in Whatcom County are reportedly 3 weeks behind last year...which was remarkably early.
  • Raspberries in Whatcom County are showing signs of winter damage and a reduction in yields seems likely; no big surprise since last season was a record crop. Harvesting likely to begin after July 4th.....much closer to normal and weeks earlier than last year. Interpack is receiving reports that the effects of root rot in all berry crops will soon become evident.
  • The bloom and fruit set so far for central Washington cherries, apples and apricots is looking "strong" according to reports out of The Packer.