Prices of materials and inputs may not be spiraling out of control as they were in the recent past, but produce distributors in the Twin Cities area still face some economic challenges.
“Produce is a little bit different than other commodities,” said Pat Miller, chief marketing officer for Russ Davis Wholesale, Wadena, Minn., owner of Liberty Fresh, St. Paul, Minn. “It’s a roller coaster.”
Inflationary periods often are followed by periods of lower prices, he said. “It depends on growing conditions and Mother Nature.”
The costs of growing and processing produce have gone up since the COVID-19 pandemic because of inflation on labor, energy, fuel and materials, Miller said, but the cost of trucking has flattened in recent months.
More truck drivers are available than a few years ago due to lower demand, but there still remains a shortage, he said.
“We deal in commodities, we buy and sell fruits and vegetables, we hire trucks,” said Jason Hendrickson, vice president of procurement and business development for Wholesale Produce Supply LLC, Minneapolis.
“These are all fluctuating markets,” he said. “There are reasons things are up and down that have nothing to do with inflation.”
Costs are starting to come down for Bergin Fruit and Nut Co. Inc., St. Paul, said Tom Bergin, chief operating officer. During the COVID-19 pandemic, capacity ramped up at many of the companies Bergin Fruit and Nut Co. does business with as production switched from bulk to packaged, he said.
“Now, a lot of production plants have excess capacity, and things have opened up,” Bergin said.
Labor costs seem to be more of a challenge for some firms than others.
“Labor is the toughest part of the industry right now,” Miller said. “Labor is much more expensive and very, very, difficult to find for us, as it is in other businesses around the country.”
Nonetheless, he said, “We continue to train workers and get people on the job.”
Wholesale Produce Supply doesn’t seem to be experiencing the same labor woes as many other companies.
Hendrickson says the company’s stability as a business and its reputation have provided good access to a labor pool.
“Wages have stabilized and are not as challenging as they were two or three years ago,” he said.
Similarly, Bergin said, “Labor has gotten to be more stable.”
