During last season’s desert deal, iceberg prices skyrocketed, sometimes surpassing the $50 mark. Manassero said odds were that won’t happen again this year.
By the end of the winter deal, shippers got all the cartons they expected out of their fields, he said. The problem was that weather fluctuations caused the industry to be severely short for four to five weeks.
Also contributing was a trend toward contract buying and a more limited pool of open market supplies, which now represent only 25% to 30% of total product. So if overall supplies in the industry drop by 10%, open market supplies go down 30%, which magnifies market fluctuations, Manassero said.
Last season, processed salad producers drove much of the heightened market, he said. Processors sometmes paid much as 10 times their usual costs for lettuce on the open market.
“They’re not going to underplant this year,” Manassero said. It’s cheaper for processors to disc under a few unneeded acres than buy open-market supplies, he said.
As early October approached, Manassero said demand seemed limited. A West Coast dock strike wasn’t helping movement, either, he said, but the strike’s effects would hurt broccoli more than lettuce, he said.