MARKET REPORT – OCT 12, 2018
Time to start looking at the bigger picture …
…with the local production season winding down quickly now that we’re aiming into the middle of October and for me to start sending out reports much more regularly.
Apples: This will be a very interesting year, and no one will know until it’s over. Here’s the deal. Without knowing why, or being able to comprehend outcomes, the Trump child-person decided to attack China on trade and impose tariffs. China countered with their own. One of the victims was U.S. Fruit, where Chinese importers have to pay 25-50% duties to their government now. Which makes Washington Apples 25-50% more expensive. (The US exports of cherries back in July were down nearly 50%. China instead imported twice the amount of cherries from BC as a year before.) Washington relies on exporting literally tens of millions of pounds of apples to Asia, with China being the lions share. Losing that market will see early domestic dumping, after an above-average harvest. At the same time, there could be huge demand for BC Apples, organic and conventional, and at what we would consider outrageously high pricing. BC Organics will continue to be in high demand in Korea and Taiwan, countries that, like the EU, have much stricter tolerance levels for pesticide/insecticide residues, which has already left most American conventional produce entirely out of their markets, with importers in these Asian countries only buying organics rather than leaving containers of produce at port when it doesn’t pass muster. Bottom line – BC growers are going to shove more fruit into the export pipeline and potentially end the season early, esp. on Granny, Fuji, Gala and Pinks, if they can get a good push into those offshore markets – and Washington fruit will start dumping early and be in strong supply well into early summer. Who knows?
Onto weather: We’ve got some very interesting set-ups in play that have already affected pricing today.
Matthew: Very dynamic storm this was – going from a ‘maybe’ to a borderline Cat 5 in 72 hours. Even 2 days before landfall all the global models except one were forecasting a weak storm barely reaching Cat 1. It just happened to pass directly over some of the warmest loop eddies in the Gulf of Mexico and blow up. There is potentially 1 – 2 Billion dollars of agricultural loss in Georgia and some parts of Florida. These areas produce a huge percentage of the continent’s peanut demands, as well as cotton and corn. Georgia is also a huge ground crop region, supplying thousands of acres of greens, cukes, zukes, tomatoes etc. for the N.E. US markets (New York, Philly) and Toronto and Montreal. They’ve lost the entire last 6 weeks of their production cycle – for many of these growers they were just starting harvest. We expect to see some impact on pricing as Mexico, just starting into their winter cycle will see some very strong demand.
Sergio: The third hurricane to pass through Baja and southern California / Arizona is due in 48 hours. (Bud and Rosa already did their damage earlier this year.) Although not a big storm, there will still be serious ramifications for some growers. A predominant amount of our winter supply for tomatoes, peppers, zucchini and many more is produced along the coasts of Culiacan (just north of Manzanillo) and Sonora, inland to Hermosillo (3 hours south of Tuscon, AZ) as well as the Baja peninsula. We’re talking about Covilli, Wholesum, Divine Flavour, Rico, Del Cabo and many more. While all these storms have different paths, their impact spreads over a large area. Growers in many parts of this area are still cleaning up after Rosa. The picture is of an underwater field in Los Mochis in Sonora, from Rosa in late September.
On the pleasant side, it is absolutely unheard of to have this:
Who would have thought the Fraser Valley would have 12 days of continuously nice weather in the forecast, and then add on 5 nice days we just had to the front end of that. 17 days of sun! Much speculation about how a changing climate is slowing down high pressure ridges (and low troughs) to the point they stand still. Blocking ridges they call them – well this one is a beauty and looks like it will block rain from coastal BC for some time. Every vegetable farmer out there would have planted an additional rotation of fast growing lettuce, radishes and spinach if they had this pattern in their sights when planning their season– could have been awesome – instead, their late fall plantings are never very big because days of rain can end the season quickly, and now they are sizing up faster than expected. Thin supply levels are not cold weather related at this time on lettuce, cilantro and others – that’s just latest plantings sizing up faster than normal on days that historically are never this warm. Some records will be set next week. But other than that it sure is nice!
A few other quick notes:
BC Grape Season is all but done with the last of the latest in house. Same story with BC Plums. Pear selection always excellent although BC Bartletts are finished their fast 8 week ride already, a little earlier than normal after a disappointing harvest of smaller than normal fruit. We’re down to the last of the California Mangos – we always save the best for the end of the season! But Mango Season are two words that don’t go together anymore! We used to have a 3 month gap when Mexico and California ended – waiting for the first Ecuador fruit to hit before Christmas. No more – Ecuador is already harvesting with product due in here potentially before the last California Keitt is gone in 2 weeks. Peru is expecting to harvest up to 6 weeks earlier than historic normal. That is definitely climate change. Peru growers are going to get crunched in with Ecuador production for the first time I can remember, but on the other hand, Peru is expecting a dramatic crop reduction of up to 90%, with whole regions experiencing a high branch and leaf growth period with low fruit production. Mangos are very fussy about growing conditions and speculation is that, like all vegetation, increasing their food (CO2) by 60% in the atmosphere in just a few decades is changing growing patterns substantially.
Seasonal changes of note now include Kiwi Berries (although past the peak) Persimmons, Pomegranates, and in just a couple of weeks the beginning of the Chinese Mandarin deal.