After a very difficult marketing situation during the first part of the season, dwindling supplies from Mexico have quickly created very strong demand for California avocados and the market continues to gain strength.
Rob Wedin, vice president of fresh sales and marketing for Calavo Growers Inc. in Santa Paula, CA, told The Produce News May 25 that with Mexico’s production declining significantly in May, even better-than-expected production from California has resulted in upward movement on the price. In much of April, even the largest and most popular avocado SKUs were selling for only about $25 per carton. By late May, those same SKUs were in the mid-$40s per-box range prior to Memorial Day, and Wedin said the expectation is that the price will climb higher in June.
Robb Bertels, vice president of marketing at Mission Produce Inc. in Oxnard, CA, said the same report came from the production meeting his company held the previous day. With regard to the market price, he said, “We don’t believe we have reached the peak. The marketplace volatility created by declining supplies from Mexico has upset the whole system. Prices are being pushed up and we think that will continue.”
Gary Clevenger, chief operating officer at Freska Produce International LLC in Oxnard, CA, noted the same supply issue when interviewed on May 20. He said the California field price had shot up in mid-May as a result of demand. While a lot of California fruit is pre-committed to various packers by the thousands of growers who produce it, the daily or weekly field price is quite volatile and very reflective of the demand situation. In April, filed prices were very low but were seemingly rising daily come late May.
Bertels said the U.S. demand for avocados has proven to be around 50 million pounds per week. Mexican producers had a few very large weeks in the first couple of months in the year, when their shipments alone topped 50 million pounds. That depressed the market as California was starting to ship.
But looking forward, the Mission Produce executive said it is hard to see how the 50 million pound number will be reached in late June and early July.
“That’s when it looks like there are going to be some gaps,” he said.
Wedin noted that California growers do have great marketing opportunities right now and they are taking advantage of them. In late May, those growers were sending about 18 million pounds per week to the market. Mexico was around 30 million pounds and expected to drop to closer to 25 million pounds per week for much of June. He expects California production to peak at around 19 million to 20 million pounds and stay in that arena through maybe mid-June.
In July, Calavo has estimated that California’s production will drop into the 15 million-pounds-per-week level and August will see a further decline.
Wedin noted that lack of rain in Mexico has delayed the new crop from Michoacan, with most packers not expecting to have new-season fruit until after July 1. That means the 50 million-pound-per-week threshold could be very difficult to reach through at least early July. Consequently, the demand-exceeds-supply situation could continue deep into the summer, which is when demand is typically at a peak.
By around May 20, California had shipped close to 40 percent of its estimated 2016 volume of 390 million pounds. Another 100 million pounds should be shipped by the end of June, leaving a very manageable volume for the final few months of the season.
Of course, each of the marketers noted that the situation can change quickly. If prices continue to strengthen, growers from all points of origin will try to take advantage and get some fruit in the box and into the U.S. marketplace.
Peru avocado exporters are largely relying on Europe this year because of strong markets there, but they might increase their shipments to the United States if warranted.
In any event, it appears as if a very significant volume of the 2016 California crop will be shipped under strong marketing conditions — a situation that did not seem possible just six weeks ago.
One of the most critical issues surrounding consumers today is the safety of fresh fruits and vegetables purchased at the supermarket.
Where was that lettuce before you bought it at the store? How many people handled it? What did they handle before the lettuce? Who cut up that fruit in the container you just put in your shopping cart? Where and how was it processed? How clean is it? Is it safe to eat? Was the display case cleaned where you picked up that broccoli? How was it cleaned? What type of cleaning material was used near the product?
These may seem like intimidating questions, but they’re legitimate. After all, we’re talking about the safety of our food, especially in the produce department where a good portion of the product is exposed in bulk form.
Our food supply is the safest in the world. We have the strictest rules and regulations from farms to dinner tables that protect our food throughout the system. Besides governmental rules and regulations, companies have added their own in-house programs to further ensure the safety of food they grow, pack, ship and sell to consumers. And those companies work very hard at making it right.
The FDA Food Safety Modernization Act concentrates on averting food problems beforehand rather than just taking action whenever foodborne illnesses materialize. However, that is a huge challenge in itself.
The industry has made considerable headway in establishing safety programs throughout our food chain system. But even though we have all the structures in place, our food is still sensitive to harm by other means, such as vandalism or bioterrorism.
Whenever these crimes occur, they have an effect across the board, including on personal lifestyles. And they increase rules on manufacturing and products, which comes with a costly price.
In September of 1982, poisoning deaths occurred when someone deliberately tampered with bottles of Tylenol. Soon afterwards, more deaths followed as a result of copycat criminality. Tragic deaths from these crimes led to the foundation of tamper-proof containers.
In 2001, a traveler boarded an airliner with explosives hidden in his shoes. Thanks to alert passengers, he failed to detonate it. But now we have to remove our shoes at the airport while going through security screening.
More recently, there was an incident in Michigan where someone intentionally sprayed poison on fresh produce in several supermarkets. A suspect was taken into custody and the case is now being investigated by the FBI.
And here we are with still another price to pay. Will this incident force us to change the manner in which we display produce and how we stock the grocery store shelves? After all, spraying poison onto fresh fruits and vegetables by some deranged individual is not exactly expected in our produce departments. In fact, it’s downright frightening.
Could this act force us to focus on the expansion of packaging? It could strengthen additional protection for the product and consumers. But it may not be a guarantee in totally stopping foodborne illnesses or dangerous people.
Tim Vaux, vice chairman of FreshXperts LLC in Fresno, CA, said, “My first thought is that packaging can help, but if someone wants to cause harm, they’ll find a way, in spite of the best attempts at trying to protect consumers.”
Packaged produce has its value to both retailers and consumers. It safeguards sanitation, seals in freshness, controls shrink and adds convenience.
All these reasons are favorable when it comes to packaged produce. However, in a much-changed world today, we must still be on high alert for any similarities like the incident in Michigan.
The FDA.gov website has some worthwhile information on industry security and preventative guidance related to food. It lists some very good advice, especially for employees to be watchful of any signs of product tampering or various other acts of sabotage. It also encourages employees to immediately alert management of any suspicious or criminal conduct.
You’ve heard the phrase, “If you see something, say something.” We all play a vital role in preventing our produce from becoming the victim of bioterrorism by being on the high alert.
This is yet another unpleasant challenging battle out in the trenches.
NEW YORK -- Avocados from Peru hosted a superfoods breakfast May 27 to honor the 2,000 men and women of the U.S. Navy and U.S. Marine Corps who proudly serve on board the USS Bataan, an 844-foot, 40,358-ton amphibious assault vessel.
The breakfast featured Peruvian avocados and other superfoods from the South American nation and was timed to take advantage of the patriotism associated with Fleet Week and the Memorial Day holiday weekend. This was the second year the Peruvian Avocado Commission hosted such a breakfast, following last year’s event aboard the USS Cole in Port Everglades, FL.
“The Superfoods Breakfast is a historic event and we are pleased to be giving back to the great men and women of the U.S. Navy and Marine Corps,” said Xavier Equihua, president and chief executive officer of the Peruvian Avocado Commission, based in Washington, DC. “We look forward to many more opportunities where we can feature Avocados from Peru, as they are at the peak of their season this summer, and 100 million pounds are projected to be imported into the United States between May and September.”
Further highlighting and already special event was the presence of Gustavo Meza-Cuadra, Ambassador of Peru to the United Nations, and his wife, Sonia Balcazar de Meza-Cuadra, who joined the men and women serving on the USS Bataan for breakfast.
McLane Co. Inc., a $48 billion supply chain-services leader, has announced the rollout of McLane Kitchen’s nationwide Fresh Produce + supply chain solution to help convenience store operators establish their locations as destinations for fresh produce.
The company said Fresh Produce + provides top-quality products, operational best practices, merchandising units, information on suggested retail pricing and best-in-class customer service, allowing operators in multiple regions to offer a consistent product mix of healthier options. For single convenience stores, McLane’s nationwide distribution means leveraging the company’s buying power to better compete pricewise, while ensuring high-quality fresh produce.
“We recognized our customers wanted a consistent way to fill their consumers’ need for safe, fresh, better-for-you produce,” Holly Veale, product director for foodservice at McLane, said in a press release. “McLane Kitchen’s Fresh Produce + solution makes fresh produce and cut fruit available to all our customers, regardless of size or location.”
According to an independent study, 48 percent of Americans say c-stores are a place to buy fresh items. What’s more, 50 percent of c-stores have expanded fresh-fruit sales, while 30 percent have increased cut fruit and vegetable offerings, according to a 2015 NACS retailer sentiment survey.
Fresh Produce + offers mark-up options associated with varying levels of product guarantee. It is also fully compatible with McLane’s Premium Ordering Management Suite and smart hand-held technology, giving operators the ability to order fresh items just as they would any other SKU. Over the coming months, the solution will integrate seasonal items and category management.
In conjunction with the Fresh Produce + rollout, McLane also recently announced its affiliation with The Partnership for a Healthier America.
McLane provides grocery and foodservice supply-chain solutions for convenience stores, mass merchants, drug stores and chain restaurants throughout the United States and it operates 80 distribution centers. The company buys, sells and delivers more than 50,000 consumer products to nearly 90,000 U.S. locations.
Exporters and U.S. importers of Guatemalan fresh fruits and vegetables are in the process of building their association, which was established last fall.
Priscilla Lleras-Bush, the Miami-based coordinator of the new Guatemala Produce Trade Association, said, “As an association, we work as a united front on the basis of increasing brand awareness for Guatemalan produce consumed throughout the United States. We collaborate and share information with members regarding industry production, technology and regulatory issues to enhance quality standards. The co-chairs and the coordinator identify the industry needs, goals and collectively strategize, represent and implement solutions on behalf of the association’s industry issues.”
Leading the association are the exporter co-chair, Ricardo Sieveking, president of Transcafe S.A., based in Guatemala City, and importer co-chair, Robert Colescott, president and chief executive officer of Southern Specialties, located in Pompano Beach, FL.
While Transcafe is a large coffee company, it also has an interest in produce and Sieveking is the president of Guatemala’s sno pea committee.
Colescott said that Guatemala, as a producing region, has tremendous potential to provide true value to the North American market. “The range of products being grown there continues to expand,” he said. “We see huge opportunities for growth, and by working together we can create synergies for our grower and importer members that would not be available to us as individual entities.”
GPTA’s mission statement states that the group “aligns Guatemala exporters and U.S. importers towards the goal of increasing consumption of Guatemalan-grown fresh fruits and vegetables throughout the United States.”
“One of the goals as an organization is to gain support from both government and private sectors in Guatemala to recognize the importance of agriculture to Guatemala’s economy in many ways, which include their GDP supported by strong labor employment,” Colescott said. “We want to improve the technical expertise of those involved with agriculture and further improve existing standards associated with food safety, traceability and growing practices.”
“Since the inception of exporting, Guatemala has kept our focus on food safety, social responsibility and traceability,” Sieveking said. “Through our exporter associations, we provide many initiatives and avenues for growers of all fresh fruit and vegetables to advance their farms’ expertise with the implementation of food safety, social responsibility and traceability.”
Colescott said that over the years, members of the association have made significant investments in implementing food-safety measures and establishing sustainability and social responsibility programs. “One of our goals is to inform buyers and consumers of the high caliber of our operations in Guatemala and the U.S., as well as those products we grow and import.”
“We will be working with other Guatemalan category associations, and government agencies to collaborate and strengthen efforts,” said Lleras-Bush. “It is our opinion that through collaborated efforts of both agency and industry, we will be able to improve and enhance the entire trade process with Guatemala and provide an example of excellence for other commodities and countries to emulate.”
Lleras-Bush noted that the association met April 28 in Miami. The meeting, with more than 25 people in attendance, “proved completely successful and has increased momentum on maximizing our focus and influence to amplify the brand awareness of produce from Guatemala.”
Expressing the overall benefit of the association, Sieveking said, “We will be able to further advance and enhance initiatives that will help increase exporter and importer collaboration, per-capita consumption and bring Guatemala to the forefront of retailers, foodservice and U.S. consumers’ minds by providing healthy, nutritious and delicious fruits and vegetables. We are already making many inroads with GPTA and look forward to gaining even further momentum.”