Discovery Organics | MARKET REPORT – MARCH 4TH, 2016
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MARKET REPORT – MARCH 4TH, 2016

MARKET REPORT – MARCH 4TH, 2016

The real punch of El Nino starts to hone in, albeit a few months later than forecast

A Brief touch on the weather will likely guide you on the upcoming markets.  Temperature anomalies have continued across southern California into Arizona, and coastal Mexico all week with highs and lows hitting April-like values.  That will change this week, with temperatures dropping closer to normal as the real punch of El Nino starts to hone in, albeit a few months later than forecast.  Coastal California is expecting copious rains, which will slow down the small amount of harvesting going on with greens, but will definitely impact all strawberry production, although it has been well below average for several weeks and just hit stride the last few days.

c.Azul

All ripening berries have to be stripped and tossed after a good soak, so expect markets to tighten right back up later in the week.  The rain will extend across the desert areas, but only minimally, and for one day.  These powerful storms, which are just touching us up here are also pulling a tongue of cold air south – very far south, with a high probability of cold and snow as far south as Guadalahara, where they haven’t had snow since 1881, and which could impact production from Agrofresco.

We have just received our last shipment of Cerro Azul bananas, switching entirely over, starting in 10 days, to Peru (BOS).  This shipment is not labelled Fair Trade, nor are we selling it as such.  Although nothing to do with organic rules, Cerro Azul has been de-certified by FLO because of irregularities in supply traceability in their Fair Trade supply chain.  When you are dealing with hundreds of small producers delivering fruit every day, packed for a multitude of customers and shipping 6 or 7 containers a day, you just gotta keep on top of things.  FLO audits are rigorous – I’ve seen some involve 5 or 6 auditors at one coop lasting for a week, and have seen the massive amount of paperwork required by all producers in the Fair Trade certification programs.  (At the Cerro Azul offices, it equates to a big binder a day worth of paperwork.)  So, apparently Cerro Azul has drowned in paper and made some major errors somewhere along the line – enough to put their Fair Trade program on hold.  They are one of the largest Fair Trade organic banana suppliers in Ecuador, so this is a big hit for some vendors.

Next to Mangos – we’re nearly done with Peru fruit on our direct program from Apromalpi.  We we’re hoping for one more container but El Nino rains a few weeks ago made that impossible – conventional producers can ship mangos that have been rained on, but organic ones can’t be treated for anthracnose – a fungus that starts as little black dots and only gets worse in transit.  We will transition to buying mangos from US Brokers until the beginning of the Michoacan season, which is very late.  Mangos have two flushes of flowers, producing a small harvest of mature fruit while most on the trees is small and un-developed.  That first flush is coming in at 20-25% of normal, as well as late – all that is in the market at present is this small first flush of Tommy’s coming out of Southern Mexico.

Awful weather is currently affecting central and southern Peru.  It even rained in Lima – the city where it never rains, but up in the jungles, where ginger and turmeric come from, roads are impassible.  You may not know that the millions of pounds of ginger and turmeric grown in the Peruvian Andes all come down to the coast on a 9 – 12 hour drive in small trucks and 4 X 4’s, so with roads that are awful at the best of times, they are now not drive-able.

It’s touch and go on Pears, with Washington coolers empty (2 months earlier than last year) and the first Bartlett’s unloading this week – we will just squeak through the week on the last Washington storage varieties.

On the greens front, the glut continues, with growers pleading for sales on a multitude of crops.  This isn’t unusual for one crop or another, but all greens are down across the board.  What comes up, must go down…..old lyrics but pay-back time will come soon and we continue to believe, and be told, that this will switch back to tight and spendy markets imminently.  No one has been able to put a finger on what imminently actually means, but enjoy the pricing while you can.  Prices are also completely in the basement on tomatoes as well.  In fact, looking at our average price per case going out of here, we are currently at 19% below a year ago, and that’s with a 15% currency difference compared to last year, which is somewhat remarkable.  Considering we all know this isn’t going to last forever, with even Mexican product selling well below the cost of production, you may want to look at sneaking in a little bit of extra margin on these dirt-cheap products.  I saw organic broccoli on the shelf at a major supermarket yesterday with a hefty 300% markup – just sayin’.  Speaking of currency, the dollar has recovered somewhat in the last couple of weeks, so you will see adjustments downwards as well on a few items.

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