Freight costs likely to hike California cherry prices - The Packer

Freight costs likely to hike California cherry prices

04/18/2011 11:28:52 AM
Don Schrack

With per-gallon gasoline prices hovering around $4 and diesel fuel even higher, retailers will likely be forced to charge more for California cherries this season.

“A truckload is going to be an increase of about 25% compared to a year ago,” said Jim Culbertson, manager of the California Cherry Advisory Board, Lodi.

One consolation for cherry buyers is the industry’s standard 16-pound carton, which is among the smaller cartons for fresh California fruit.

“We’re able to put 90 cartons on a pallet,” said Rich Sambado, sales manager for Primavera Marketing Inc., Stockton, Calif.

While higher freight costs may raise per-carton prices, the cost is divided by so many cartons that it gives the illusion that the price didn’t go up so much, said Maurice Cameron, president of Flavor Tree Fruit Co., Hanford, Calif.

Another small advantage for the cherry industry is that not all of the deal will be shipped by truck.

“Cherries are a commodity that still travels occasionally by air in the U.S.,” said Cameron.

“If it gets really expensive to go by truck, I think you’ll see a lot more people stay in the air business longer because the difference won’t be as much.”

The airfreight market, Cameron said, tends to be more of a supply and demand situation driven by the available freight capacity of the airliners.

Primavera Marketing uses airfreight domestically on the front end of the season, Sambado said, while nearly all export shipments go by air.

A problem still facing the cherry industry is the drosophila fly, a relatively new to California pest.

“It likes good quality fruit,” Culbertson said.

“That’s where it’s different from most vinegar flies that prefer rotting fruit.”

Adult drosophila flies penetrate the skin of cherries and lay eggs in the fruit, he said.

“I think we’re going to have to deal with it from now on,” Culbertson said. “Eradication is not being discussed.”

Grower-shippers were able to implement control measures last season, and the industry was successful in keeping the drosophila out of packs and keeping orchards clean, he said.

With eradication not on the horizon, the California cherry industry, Culbertson said, is conducting research on how grower-shippers could use fewer sprays and control the pest easier with better timing.

An enigma for California cherry grower-shippers is the industry’s long-held belief that the fruit is alternate bearing — large volume one year followed by lower volume the following year and repeating the cycles.

“Cherries do tend to be alternate bearing,” Cameron said. “But we don’t see it across the whole crop. It almost depends on the unique situation of each particular orchard.”

Adding to the uncertainty is that the trees don’t recognize some weather problems once the fruit is set.

“If it rains, for instance, and the fruit splits, the tree doesn’t know it’s lost all of its fruit,” Cameron said.

On the other hand, the trees do seem to be aware when a light bloom, poor pollination or frost damage reduces volume, he said.

A luxury enjoyed by California grower-shippers, Culbertson pointed out, is the state’s cherries are the first of the year to hit the domestic market.

“We don’t compete with anything internationally,” he said.

“What little import pressure there is comes from Europe, and most of that fruit goes only to the East Coast.”



Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left

Feedback Form
Leads to Insight