The U.S. is getting browner, apple inventories are getting redder

06/12/2013 05:59:00 AM
Tom Karst

Tom KarstAs I clock into this blog at about 5:26 a.m., I wanted to mention a couple of reports that caught my eye. One is an embargoed release from the Census Bureau that reveals the status of the population on July 1, 2012. Though the details can’t be spilled until tomorrow, it is safe to say we are older and less white than we used to be.

I continue to marvel at the U.S. Apple Association statistics showing storage holdings running way up from a year ago, yet at market conditions that are historically strong. The apple marketers in Washington state are seemingly impervious to the fact that supplies are so heavy.

We have strong apple sellers in Washington and the state is the only substantial source of apples in the U.S.

 From Andy Nelson’s coverage this week, we see that roughly 24.9 million bushels of U.S. fresh-market apples were still in storage on June 1, 27% more than last year at the same time and 21% up from the five-year average. Of that total, Washington accounted for all but 300,000 bushels.

I talked to a market source yesterday and reported fairly firm pricing for most remaining apples, though he acknowledged that red delicious have come off this spring. Red delicious holdings in Washington were at 12 million bushels on June 1 compared with 10 million a year ago.

For the uninitiated, the USDA’s new Custom Average Tool helps to quickly break down the average price trends for any commodity.

Taking a look at red delicious apples, the USDA’s custom average tool calculated that the average shipping point price for red delicious apples in the U.S. from Sept. 8 to Dec. 29 was $29.28 per carton for all sizes. Shipping point prices started off at an average of $34.76 the week of Sept. 8, falling to $26.79 by the end of December.

For 2013, the USDA custom average tool show that red delicious prices have averaged $22.49 from Jan. 5 to June 8. Average prices for reds started the year at $23.86 but fell to an average of about $20.05 per carton by June 8.

As we look forward to the U.S. Apple Association Marketing Conference in August, there will be high drama over the first estimate of the U.S. apple crop that will be unwrapped there. Budget cuts have knocked out the USDA August crop estimate, so the whole world will be looking to what industry estimators say.

With expectations of a much bigger national crop of apples, it would seem Washington apple marketers will look to thin inventories in the weeks ahead, particularly for heavy varieties like red delicious.


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