Thursday, January 22, 2009

A Tree Falls In The Forest...

I know it’s early in the process but…what if Florida had a freeze and nobody cared?

Early data coming out of south Florida this morning shows significant time periods under 32 degrees in the tomato growing areas, with little wind (bad) and clear skies (worse). Here’s the best website for that weather info:

http://fawn.ifas.ufl.edu/

Traditionally, the way the scenario plays out is this: the freeze takes place, the growers assess the damage, and then decide whether a salvage operation is feasible. Most times it is---in my 29 years in the business I can only remember two or three times when there has been a complete and utter wipe-out.

So we wait. We’ve been down this road many, many times before but, at least initially, I get the sneaking suspicion that, for a variety of reasons, we aren’t going to get the highly volatile price spikes we’ve had in the past after a freeze. The Mexican tomato market has been glutted for at least two weeks, with export prices to the U.S. up till now not able to rise above the minimums deigned by the Department of Commerce suspension agreement. Depending on the severity of the Florida freeze, the Nogales market is due for at least a bump. And the tomato pipeline right now is full to bursting with little terminal market movement, especially in Chicago where we’ve been below freezing for over two weeks straight.

And truthfully, I still don’t think we’re totally past the salmonella fiasco of last summer, at least from a consumption standpoint. If the retails are forced up in the stratosphere again, say $2.49 plus, the customers don't need ‘em. It’s that simple, unfortunately.

Later,

Jay

1 comment:

Tom Karst said...

Good link. I think you may be right about the wild price swings - they may be a little toned down this winter

Tom K