ProduceIQ: Avocados surge as growers hold back harvests

Today marks the official start of the Atlantic hurricane season, but the early outlook offers a rare reason for optimism.

Forecasted El Niño conditions are expected to suppress Atlantic storm activity, increasing the likelihood of a quieter-than-average season for East Coast suppliers and buyers. For produce markets, fewer tropical storms could mean fewer supply disruptions along the Gulf and Atlantic coasts during the season.

That doesn’t eliminate weather risk, but it may remove one potential source of volatility as produce players navigate Mother Nature’s whims. While hurricane season may be starting on a relatively quiet note, produce markets are entering June with plenty of volatility of their own.

ProduceIQ Index:  $1.21/pound, down +2.6 percent over prior week

Week #22, ending May 29^th  

Blue Book has teamed with ProduceIQ BB #:368175 to bring the ProduceIQ Index to its readers. The index provides a produce industry price benchmark using 40 top commodities to provide data for decision making.

Avocado markets are suffering a self-inflicted disaster. Mexican growers are delaying harvests in hopes of securing stronger end-of-season prices. As a result, average hass prices are up +54 percent over the previous week. Supply tightened so rapidly late last week that several suppliers declared force majeure.

Suppliers are turning to growers in California, Colombia, and Peru to help offset the sharp decline in volume. Prices and availability will likely remain volatile until at least mid-June, when Peruvian production is expected to accelerate.

Hass Avocado

Romaine markets continue to wilt under cool weather and disease pressure. Up another +11 percent over the previous week, average prices dwarf the previous ten-year high record. Strong demand will likely keep prices in record-breaking territory for the next few weeks. For buyers’ sake, we hope sleepy Salinas supply finally shakes off its spring slumber.

Romaine

For a commodity known for sticker shock, raspberry prices are surprisingly tame. Raspberry prices remain below average for the eighth consecutive week. Raspberry prices typically soften through June as domestic production joins ongoing Mexican supply. But rising domestic production doesn’t always guarantee smooth sailing. Declining Mexican production could push prices higher by mid-June as California growers work to fill the gap.

Raspberries

After weeks of elevated prices and thin supply, asparagus markets are finally returning to normal. Prices will likely trend lower over the next few weeks as markets benefit from ample supply from a wide swath of growing regions. With supply flowing from Canada, Mexico, Michigan, and Washington, buyers should find plenty of opportunities to score deals on grass this June.

Asparagus

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ProduceIQ Index

The ProduceIQ Index is the fresh produce industry’s only shipping point price index. It represents the industry-wide price per pound at the location of packing for domestic produce and at the port of U.S. entry for imported produce. 

ProduceIQ uses 40 top commodities to represent the industry. The Index weights each commodity dynamically, by season, as a function of the weekly 5-year rolling average Sales. Sales are calculated using USDA Agricultural Marketing Service data on movement and prices. The Index serves as a fair benchmark for industry price performance.