Lemons take their turn as high-dollar citrus - The Packer

Lemons take their turn as high-dollar citrus

07/18/2014 09:28:00 AM
Andy Nelson

Andy Nelson, Markets EditorAndy Nelson, Markets EditorWhen lime prices hit triple-digits earlier this year, some shippers I talked to said restaurants were switching to lemons as a cheaper substitute.

Um, are they switching back to limes now ... as a substitute for lemons?

In Spanish “limon” can mean lime or lemon. And just as they’re linguistically interchangeable in Mexico, now they’re economically interchangeable in the U.S.

“The scenario we had with limes, we’re going to have with lemons,” Dave Brocksmith, citrus manager for Vero Beach, Fla.-based Seald Sweet International, told me.

Prices at the beginning of July were trending up with a bullet, with some shippers saying $50 a box was likely.

Unlike the high lime market, however, which was mainly supply-driven (bad weather in Mexico — not, as the mainstream media might have you believe, gangsters) the high lemon prices can be traced to both supply- and demand-related factors, Paul Story, director of grower services for Exeter-based California Citrus Mutual, told me.

On the supply end, frosts in Chile are the major culprit, leaving California’s Ventura County as about the only game in town until Mexico and the California desert come into production later this summer, Story said.

In Ventura County, production is down, thanks to citrus acreage turning into strawberry acreage, he said.

Then there’s demand.

“Demand has been excellent for the last year and a half,” Story said.

A lot of that is foodservice-driven, he said, as more restaurants add lemons to their menus. (And yes, that trend started before shippers ran out of limes late last winter and began subbing lemons for them.)

When it comes to explanations, Seald Sweet’s Brocksmith is leaning more toward supply than demand. And it’s not just Chile’s frosts. California and Chilean growers have had to battle water restrictions this season.

“Those trees are not producing like they have in years past,” he said.

Despite the current super-strong markets, the lemon industry will change if Argentina gains entrance to U.S. markets, Story said.

That could happen in two or three years, he said, after phytosanitary issues get ironed out. The specter of Argentina is likely one reason those Ventura County growers won’t make the switch back from strawberries to lemons.

So maybe extremely high lemon markets will one day be a thing of the past. If limes don’t go crazy again, it will be up to navels, valencias, minneolas, murcotts, clementines, tangerines, et al to make the next citrus category run at triple digits.

anelson@thepacker.com

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