California summer grape deal adds stability to market

Author: 
beckman@theproducenews.com (Tim Linden)
Date: 
Wednesday, 17 July 2019 - 10:48am

By all accounts, this has been an abnormal season for fresh table grapes. Both California’s Coachella Valley and new-crop grapes crossing from Mexico typically fill retailer shelves in May and continue through June, overlapping a bit with early July production from California’s San Joaquin Valley.

This year has been different.calgr

Cool spring weather saw both of the spring deals get off to a slow start. In fact, in late May, Louie Galvan of Delano, CA-based Fruit Royale Inc., which has a significant Mexican deal, said: “We keep waiting for Mexico’s massive crop,” he said adding that in his 20-plus years of sourcing grapes from below the border he has never seen such cool weather in Mexico at that time of year. “We’re going to have to put our selling shoes on for the next six weeks to move that crop.”

Six weeks later, in early July, Mexico was still shipping a lot of grapes to the United States. Rob Spinelli, sales manager for Anthony Vineyards, in Bakersfield, CA, indicated that shippers from Mexico were desperately trying to clear out their coolers prior to the start of volume from California’s Central Valley. He noted that grapes from Mexico were being offered at very low prices.

Coachella Valley also had some volume left as the late start, and continued cooler-than-usual summer temperatures, had that deal also limping to the finish line following the Fourth of July weekend. But, at this writing on July 8, temperatures were expected to spike in the Coachella Valley with a 118 degree day forecast for July 12, and similar temperatures for the days surrounding that day. The grapes will have a tough time surviving those temperatures and even if they did, workers will not be spending much time in the vineyards.

Spinelli said the availability of all three colors of grapes from the San Joaquin Valley by the week of July 15 should effectively end the Coachella Valley and Mexican grape deals. He reasoned that buyers and truckers are not going to go the extra miles to pick up grapes from those regions when they can get new crop grapes from the Central Valley. He said that by the week of July 22, there should be promotable volume of all three varieties and he expected a stable marketing situation to return.

Brian Crettol, vice president of sales and marketing for Jasmine Vineyards Inc., in Delano, CA, made a similar observation on July 5. On that day, he said the price for Mexican grapes “were all over the place” while Coachella shippers were commanding $16-18 for their fruit. “Give it two weeks and the market will stabilize when all the colors are coming out of the valley.”

Jared Lane, vice president of sales and marketing for Grapeman Farms, in Los Angeles, told The Produce News on July 8 that his firm had harvested its first vineyard of Flame Seedless that day but by the following week, they would be in full production. “It’s going to be a sprint this year,” he reasoned when talking about the late start to the deal.

Lane said there is going to be no gradual ramp up in production as the industry goes from zero to 60 in a very short time frame. He predicted promotable volume within two weeks of his firm’s start date.

Commenting on the Mexican situation, Lane diplomatically said, “Mexico has cleared up its red grapes but it still has extra supplies of greens.”

He noted that the San Joaquin Valley is now being dominated by many different proprietary varieties leading to the generic promotion of red, green and black grapes rather than varietal promotions. He said these new varieties are high flavor and are preferred by consumers but varietal name recognition is still lagging behind. In addition, the volume of each of these varieties does not rise to the level of the old standards, which dominated the market in their respective colors. While the Thompson Seedless variety has been phased out by almost all growers, Lane said there is still no one-for-one replacement for the Flame Seedless.

This lack of a single dominant red or green variety means most retailers are more comfortable advertising grape promotions by color rather than variety. That gives them options when trying to fill end displays on ad.

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In business since 1989, D. Otani Produce, Inc. has grown into one of Hawaii’s largest produce wholesalers, enjoying business with hotels, restaurants, local business institutions. We are also a major distributor to Hawaii’s retailers.

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