October 14, 2009

2 Min Read

Unusually high temperatures in July and August has cut production of California table grapes — in fact, in late September the California Table Grape Commission lowered its forecast production for 2009 by 10 percent to 90 million boxes.

What’s more, the Oct. 6 Western Fruit Report Grape Cold Storage Summary issued by the USDA’s Agricultural Marketing Service lists Sept. 30 holdings of grapes in California as the lowest since at least 2003, says Rick Paul, category director for grapes for producer grower and marketer Sun World, based in Bakersfield, Calif.

Among the varieties most affected by lower yields have been the later-season types such as Red Globe, Autumn Royal and Thompson seedless.

To this point, the smaller 2009 crop has been matched by higher-than-average prices.

“The higher prices reflect lower supply, but demand that is still very good,” Paul says. “That’s a pleasant surprise.”

In early October, for example, No. 1 Crimson seedless, representing the largest share of grapes being harvested at that point, was selling for $16 to $18 a box. That compares to a year ago, when prices for No. 1s ranged from $12 to $14 a box. That’s the same price a box of No. 2 Crimson seedless has been selling for this season — $4 to $6 higher than last year.

To drive consumer traffic in a downturned economy, many retailers have heavily promoted table grapes this season, Paul says.

“They are promoting grapes at aggressive price points and compressing margins in the category. But, they want to get people into the store and fresh grapes are one of the most effective traffic builders in the produce department.”

Still, he warns, the higher prices that growers are enjoying can cut the other way, if they reach the point where retailers will pull support and promotional sales fall off.

The overall quality of San Joaquin Valley grapes this season has also helped spur consumer purchases.

“Sugar was higher on the first day of the San Joaquin Valley harvest than we ever saw this year in the Coachella Valley, where maturity was really a problem,” Paul says.

Despite the good results so far this year, it’s not time to get overconfident about the market.

“We feel good about where we are right now — but we have a way to go,” says Gordon Robertson, Sun World vice president, sales and marketing. “Red Scarlotta’s, Crimsons and Red Globes are big varieties for us and we’re only about halfway through harvest, so, we’ve still got substantial volume to move.”

These comments came before heavy rains drenched the Central Valley in earlier this week.

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