Lower volumes may mean stronger markets in 2010-11 - The Packer

Lower volumes may mean stronger markets in 2010-11

11/17/2010 02:34:15 PM
Andy Nelson

Coming off a depressed 2009-10 offshore melon season, importers are optimistic that lower volumes will help guarantee more stable markets this season.

Because of a rainy growing season, Pompano Beach, Fla.-based Ayco Farms Inc. does not expect to have peak volumes of personal watermelons, honeydews and cantaloupes from Guatemala and Honduras until January, said Ken Kodish, key account manager.

That will affect the company’s ability to take full advantage of winter holiday demand, Kodish said.

“We’ll have enough to handle steady business, but not enough for aggressive ads,” he said.

That said, peaking late this season hasn’t been a bad so far, and it may not be a bad thing in December either, Kodish said.

“Last year there were cheap markets in December, and right now the personal watermelon market in Mexico is cheap,” he said. “We’re not missing out on anything.”

With the lower volumes, Kodish projected a strong December, with demand leveling out in January, though he stressed it was hard to predict markets that far in advance.

Brazilian melon shipper Itaueira Agropecuaria SA ships every week to New York and New Jersey and beginning in November and December every 15 days to Miami, Houston and Long Beach, said Rodrigo Lima, president of Key Biscayne, Fla.-based Crown International USA LLC, Itaueira's North American marketing partner.

The Miami, Houston and Long Beach deals, which were finalized at the Produce Marketing Association’s Fresh Summit October convention in Orlando, Fla., allow Itaueira to ship its canary honeydews and piel de sapos, which will be available in limited quantities this season for the first time, nationwide, Lima said.

Both canary melons and piel de sapos are individually packaged in netted bags under the company’s REI brand.

As it does with Itaueira’s East Coast shipments, Miami-based Coosemans Worldwide Inc. will handle distribution of the company’s Miami, Texas and California volumes, Lima said.

With industrywide volumes expected to be down an estimated 20% this season — and 25% lower than two years ago — Lou Kertesz, vice president of Pompano Beach, Fla.-based Fresh Quest Produce Inc., expects demand to stable at the beginning of the deal in late November and strong heading into Christmas.

That will be a welcome change from last season, Kertesz said, when a perfect storm of outstanding growing weather and a lack of promotions produced a winter glut in the Central American deal.

“Last year was a train wreck from the beginning,” he said. Markets could flatten out after the holidays, Kertesz said, but it won’t take them long to bounce back.

“When the first cycle in Guatemala finishes, they should spike,” he said. “With so little out of Costa Rica this year, Honduras will be the only source.”

Many Costa Rican growers have cut back severely on acreage because of sluggish markets in recent years, Kertesz said.

Acreage in Brazil, which ships a lot of melons to Europe, also is down, meaning that European buyers will be looking more to Central America this season, Kertesz. That also should help keep markets strong this winter and early spring, he said.

The poor quality of the domestic product still on shelves in early November also should spur strong demand for high-quality import product when it hits later in the month, Kertesz said.

“People are excited to see good product coming out the door,” he said.

By March and April, markets will likely either level out or get very competitive as other growing regions kick off their melon deals, Kertesz said.

Fresh Quest expects a smooth transition from its Central American to its Arizona deal in the first or second week of May.



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