Importers expect higher demand for good crop - The Packer

Importers expect higher demand for good crop

01/29/2010 11:04:52 AM
Jim Offner

As importers bring in their usual assortment of melons from Mexico and Central America, they say they’d settle for a little less drama — if an equal outcome — in the market this season than they endured a year ago.

“Volume wise and growing condition wise, it would have been exceptional. Market wise, it’s not exceptional,” said Lou Kertesz, vice president of Fresh Quest Produce Inc., Pompano Beach, Fla., which brings mainly cantaloupes and honeydews to U.S. markets from Guatemala, Honduras and Costa Rica from November through May.

Prices were low before Christmas, but they started to increase thereafter, Kertesz said.

“But, we’ve had markets that were below double digits, which are well below break-even,” he said.

The recession had something to do with that, he added.

“A lot of that had to do with lack of demand,” he said. “We felt retail pricing generally has been a little high. Movement, compared to volumes, it wasn’t an oversupply. Nobody was taking more volume than was necessary.”

Inconsistency wasn’t the story with all shippers last year, though. Brent Harrison, president of Nogales, Ariz.-based Al Harrison Co. Distributors, said the markets were good from start to finish.

“Last year, we enjoyed a good market throughout the import program,” he said.

Prices peaked at the 40-cent-per-pound level, which was phenomenal, according to Harrison.

“I think it was a lack of melons from Central America, which gave us a window,” he said. “There were light supplies out of southern Mexico, between Jalisco and Colima.”

This year, the company’s watermelons and honeydews out of Mexico have been on schedule.

In fact, things may be looking up this season, Harrison said.

“Our production is probably going to be up 80%,” he said. “One grower almost doubled his acreage. He’s got six phases and approximately 500 acres.”

As of Jan. 6, prices were in the 20s, but they were expected to move up as the season progressed, Harrison said.

“I think we’ll start to see some better prices in the next couple of weeks,” he said.

Demand started to accelerate around Christmas, Kertesz said.

“But as the demand increases, the volume will shrink,” he said.

Lighter supplies were anticipated toward the end of January, as a result, he said.

“Guatemala finishes its first cycle, so we have one area in Honduras growing, so we expect the market to increase to be moveable at retail level and break even, cost-wise,” he said.

The break-even point can vary, depending, in part, on strategy, and also on luck, Kertesz said.

“We’re able to cut costs a little here and there,” he said.

Prev 1 2 Next All

Comments (0) Leave a comment 

e-Mail (required)


characters left

Feedback Form
Leads to Insight