Growers hope for strong prices during tough times - The Packer

Growers hope for strong prices during tough times

01/25/2010 10:36:00 AM
Bob Luder

It’s a funny thing, the relationship between the economy and selling citrus. Sometimes it seems that difficult economic times actually can be a boon to the industry.

After all, as some point out, people are always looking for a boost of vitamin C during cold and flu season, not to mention incorporating grapefruit into New Year’s diet plans.

“Most of the time, when the economy is strong and healthy, selling commodities is a hard thing to do,” said John McClung, president of the Texas Produce Association, Mission. “During recession, people continue to buy those commodities.

“If there’s been real damage to the Texas produce industry, I’m not aware of it. Everybody just hunkered down. I haven’t seen the fall-off in demand that I’ve seen for other products. Prices continue to be strong.”

Prices on Jan. 19 for California and Arizona oranges ranged from $12.53-13.55 for 7/10 bushel cartons of first-grade 72s navels. That compared with $13.48-15.50 a year ago. Rio Star Texas Fancy grapefruit was priced at $19.25-20.30 for 7/10 bushel 23-27s. First-grade 75s lemons from California and Arizona ranged from $24.53-28.55.

“It seems to be steadier this year,” said Gene Coughlin, category manager for oranges and lemons at Sun World International Inc., Bakersfield, Calif. “Last fall, we saw a slowing of business when the bank mess was going on. This summer and fall (of 2009), it’s been getting back to normal.”

Regardless of price, citrus should be regarded as a value product, according to some in the industry.

“If you look at the prices of oranges relative to the price of other produce items, oranges are a value,” said Neil Galone, vice president of sales for Booth Ranches LLC, Orange Cove, Calif.

“They can be sold for less money. Retailers reflect that in price. Because of the economy, movement continues to be good because of value within the produce department.”

Still, there also are reasons why citrus might not be as easy to sell as, say, apples, which can be easily eaten behind the wheel, or grapes which can be popped easily into the mouth.

“I don’t think anything has held its own,” said David Mixon, senior vice president for Seald Sweet International, Vero Beach, Fla. “The economy has affected every walk of life. We’re not moving the volume we were moving two or three years ago.

“At the same time, thank God we’re in the food business, and we’re in the natural, healthy food business.”

In other words, as long as there are dieters and cold and flu fighters, there will be demand for citrus.

“People still have to eat, and citrus is one of those basic items,” said Mike Martin, president at Rio Queen Citrus Inc., Mission, Texas.

“It’s not a luxury. People who want to eat for health are going to continue to do so. People look to fight off colds and flu by eating vitamin C.”

Most in the industry also realize they must do their parts in keeping pricing under control.

“Last year we had a very light crop,” said Joel Nelsen, president of California Citrus Mutual, Exeter.

“We noticed the movement was very slow as people were hunkering down. This season, demand is more positive. It could be the better quality of fruit. As long as we don’t get greedy and price too high, I think we’ll be OK. We know we have to take care of things on our end.”



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