Bigger crops, promotable prices expected - The Packer

Bigger crops, promotable prices expected

05/23/2014 09:58:00 AM
Tom Karst

Mast said CMI sets up a majority of its volume on a program basis.

“We try not to lock on pricing for the season, but we can do price locks for one- or two-week periods,” he said.

Last year, f.o.b. prices ranged anywhere from the low $30s to the mid-$50s on red cherries. Rainier variety cherries had f.o.b. prices from the mid-$40s to the high $70s.

The rainier variety makes up about 10% of the cherry category, and Thurlby said some retailers are under-utilizing the variety.

Average retail sales of rainiers as a percent of total cherry sales range from about 3% in some stores to a high of 15% in others, he said.

When visiting with major retailers, Northwest Cherry representatives ask retailers to assess their percent of sales of rainier cherries compared with the whole category.

In 2009, heavier volume of rainiers allowed price points of $2.99-3.99 per pound, Thurlby said. In subsequent years, the average retail price for rainiers has moved up to $3.99-5.99 per pound.

Even so, Thurlby said the 2009 crop year introduced more shoppers to the rainier, and sales have increased.

“We felt like that the demand has been stronger since (2009). We brought some people into the category,” he said.

 

Organic segment

Organic fruit is less than 2% of the Northwest cherry crop, but Thurlby said growers may be increasing that percentage in coming years.

“I have a feeling at this point that there is not enough organic in the ground to meet the demand that is there,” he said.

Retailers have increasingly mentioned their desire for more organic cherries, Thurlby said.

Suzanne Wolter, director of marketing for Rainier Fruit Co., said while the apple is the gateway item for the organic consumer, organic cherries could boost retail sales.

The greater perishability of the fruit demands greater attention to ordering and rotation, she said.

The USDA reported that the U.S. average wholesale price in 2013 for Washington organic cherries was $79.21 per box in June and $70.54 per box in July.

That compares to the average wholesale price for conventional Washington cherries at wholesale markets of $62.29 per box in June, $47.23 in July and $41.40 in August, according to the USDA.


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