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Winter vegetable deal looks promising

Using the fairly fail-safe produce industry conventional logic that a bad year is followed by a good one and visa versa, participants in this year’s western winter vegetable deal are expecting a pretty good year with good movement and good demand.

Echoing the comments of many was Russell Widerburg, sales manager for Boskovich Farms, which is headquartered in Oxnard, CA. “We are expecting a great winter deal,” he said. “As modest as last season was, this has to be better.”

Mr. Widerburg’s comments about 2010-11 were a bit understated. He said that almost across the board movement was poor. “We know growers are a lot more cautious this year (in terms of acreage planted) so that should stem the supply side and lead to tighter markets.”

In mid-November, he said the situation was already beginning to play out as expected with the Brussels sprouts market showing very good life. It was in the mid-teens and he anticipated it would top $20 before the end of the month.

Doug Classen, sales manager for The Nunes Co. in Salinas, CA, had pretty similar comments to make about this year’s upcoming winter vegetable deal. He said the 2011-12 season was marked by great yields, a mild winter and no real disruption in supplies. That led to a demand-exceeds-supply situation in many crops and poor markets on the f.o.b. side. He has heard rumblings that some growers cut acreage this season, and he said weather factors will probably play a role. All things being equal one would not expect back-to-back mild winters with no disruptions in production. “We are optimistic that it is going to be better this year,” he said.

Jay Iverson, vice president of sales and marketing for Greengate Fresh, which has its main office in Salinas, CA, said the key to the winter deal is no mystery. “It’s always about weather. If you get some weather (limiting supplies) you’ll have a good deal; if you don’t, you won’t.”

He has not heard of any significant reduction in acreage nor does he believe there will be any increases after last year’s difficult deal. Proving his point, he said last year’s abundant supplies and low prices were caused by a mild winter. “I sometimes think it doesn’t matter how many acres are planted. You can have double the acres and if you get bad weather you’ll have a good market, and you can have half the acres but if you have good weather you’ll have too much supplies.”

Mike Aiton, marketing manager for Prime Time International, based in Coachella, CA, is also expecting a good market for colored peppers, but he believes supplies should be plentiful for some great promotional prices throughout the winter. Speaking in early to mid-November, Mr. Aiton said the market was currently quite volatile because of erratic supplies but he expected that situation to smooth out as the month progressed. By December, he expected a good flow of supplies and promotional pricing. There is some belief that there are fewer tomatoes and more of other vegetables — including peppers — this winter because of uncertainty of the U.S. tomato suspension agreement.