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Cold weather influencing fresh vegetable prices, supplies

Cold weather influencing fresh vegetable prices, supplies

• Vegetable prices now are at or above the highs experienced last year. • In many cases, yields have been adversely affected leading to gaps in supply and unsettled prices.

Several freezes in Florida along with cool, wet weather in California, sub-freezing temperatures in California and Arizona, and a freeze in Mexico all have contributed to sporadic supplies of fresh-market vegetables this year.

As a result, vegetable prices now are at or above the highs experienced last year.

Mexican vegetables were hit with a stretch of unusually cold weather in early February said to be the coldest experienced in more than 50 years, according to the USDA’s latest Vegetables and Melons Outlook Report.

Crops in Sonora, Sinaloa, and most of the far northern Mexican states likely were impacted the most by the freeze. Although damage estimates were not available in time for this report, the freeze likely damaged more than 1 million acres of crops in Sinaloa, which supplies the majority of Mexico’s winter fresh-vegetable exports to the United States.

Over the past decade, the share of vegetables grown under cover (greenhouses and shadehouses) has been rising in Mexico. Thus, it is likely the level of damage will also depend both on what crop is involved, where a crop was grown, and what technology was used to produce it.

Such crops as tomatoes, peppers and cucumbers are popular crops grown under cover.

Imports from Mexico supply more than half of the warm season vegetables consumed in the United States during the winter months.

Prior to the early February Mexican freeze, fresh-market vegetable supplies had been sporadic following several destructive December freezes in Florida, periods of cool, wet weather in coastal California, and several periods of sub-freezing temperatures in the desert Southwest in January and early February.

In California and Arizona, heavy December rain, periods of unusually cold weather, and increased disease pressure disrupted growth patterns and harvest windows this winter for most cool-season vegetables such as lettuce, broccoli, carrots and celery.

In many cases, yields have been adversely affected leading to gaps in supply and unsettled prices. For example, because freeze damage reduced yields and slowed growth, iceberg lettuce prices traded in mid-February at more than $30 per 40-pound carton, double the late January price and four times the average for this time of the year. Lettuce supplies are expected to remain below average and prices well above average until late March when shipments from central California begin.

Running ahead of previous year

Despite the December freezes, Florida’s vegetable shipments, although generally below historical averages, have been running ahead of the extreme lows of a year earlier. This year, the freezes in Florida arrived earlier, were of shorter duration, and were spread out over a month. This enabled a greater share of plants to survive, resume growth, and set new blooms.

A year earlier, the weather remained very cold over an extended period of time, defeating most counter-measures used by growers and leading to nearly total crop destruction.

Prior to the Mexican freeze, total U.S. fresh vegetable supplies were generally above the freeze-reduced lows of a year earlier. In January, fresh-market shipments from all sources exceeded year earlier levels for round tomatoes (both field and greenhouse-grown), bell peppers, romaine lettuce, celery, broccoli, and snap beans.

Snap bean shipments from Florida have begun to increase following a lull caused by the December freeze. As a result, prices (although still relatively high) have eased from their December and January highs. In an average year, the majority of snap beans come from Florida during the winter and spring.

Fresh vegetable supplies likely will remain below normal for the next month or two because of these various weather events.

Although yields and available supplies will be lower, imports from Mexico are expected to continue at reduced levels until spring. Meanwhile, fresh-market vegetable supplies from both Florida and California should improve by late March as the spring harvest begins.

This winter, U.S. fresh-market vegetable growers intend to harvest 155,200 acres of 11 selected vegetables — 1 percent below a year earlier. Harvested area is expected to decline 11 percent in Florida, with most of the reduction in snap beans and sweet corn.

Meanwhile, the other three winter vegetable states expect to harvest more area than a year ago. California, which accounts for 50 percent of winter fresh vegetable area, intends to harvest 76,000 acres — up 3 percent from last winter. Although California’s broccoli acreage is lower, area is projected to be up for carrots, cauliflower, head lettuce and celery.

Although the outlook for domestic fresh vegetables this winter features reduced area, output of warm-season crops may be slightly improved from 2010 as Florida’s yields improve somewhat from the heavily freeze-damaged lows of a year ago. At the same time, supplies of leafy crops (especially lettuce and celery) from California and Arizona will be lower and variable, while imports of several key vegetables from Mexico will be lower over the next few months.

On the demand side, although still hamstrung by persistently elevated unemployment levels and consumer insecurity, the consumer market is expected to be modestly improved from a year earlier as the economy slowly makes its way forward.

Onion growers intend to plant 32,400 acres for 2011 spring-season harvest — up 14 percent from the same-state totals reported a year earlier. Despite earlier cold weather, crop growth is reportedly on a normal timeline and no unusual disease or pest issues have been noted.

Enticed by last year’s strong prices, Texas growers reportedly planted 13,000 acres — up 30 percent from a year ago and the most since 2006. Georgia growers expect to harvest 4 percent more area this spring, while California growers increased plantings 8 percent.

Most of these onions are of the non-pungent (so-called sweet varieties such as Vidalia and Texas 1015), which command a higher price (and generally feature higher production costs) than the typical pungent storage onion that makes up the majority of the onions produced in the country.

By increasing onion area, growers were reacting to both strong returns a year ago and the continuation of this past fall’s elevated onion prices. Much the same as a year earlier, strength in bulb onion prices has been the result of both favorable export demand and improved domestic movement.

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