Ask any vegetable grower, “How do you make a small fortune in farming?” In times like these, the answer is, “Start with a large fortune.”
The dry vegetable category, driven by Bell Peppers, was uncharacteristically lethargic this winter. Demand is facing headwinds from short-term factors, such as the Trump effect causing economic uncertainty and on-and-off again winter freezes.
And the long-term trend of consumers moving towards value-added, fresh-cut, and processed, produce. Buying bulk and cooking from whole vegetables just isn’t as prevalent in today’s busy home kitchens. Growers continue to press retailers to adjust the consumer price downward to move volume when the supply is plentiful.
On the supply side, costs continue to rise as labor costs drive inflation. Agriculture is facing a labor crisis as the crackdown on migration intensifies without an effective guest-labor program in place. Combined with the lack of available farmland, rising costs of food safety compliance, and increasing prices for other essential inputs, a continued reduction in planted acreage across the U.S. is inevitable.
In Florida, many farmers are simply waiting for their land to become more valuable for development than for growing crops.
ProduceIQ Index: $1.24/pound, + up 6.0 percent over prior week
Week #12, ending March 21st
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.
Pricing & Promotions
Peppers are below production cost. XL green bell pepper is $14, f.o.b. Florida. Red pepper, bushel, is $16-18. It’s time to promote!
Though Squash prices are moderate, coming off the floor, Cucumbers continue their rise, jumping to a $24-26 Super Selects. Yellow squash may tighten with the cold weather and is approximately $14 now. Zucchini is $10-12.
Watermelon remains all imported and is gapping until Florida production begins. Mid-winter prices have been below cost and recently rising to $0.39/lb as Guatemalan production drops off.
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ProduceIQ is an online toolset designed to improve the produce trading process for buyers and suppliers. We save you time, expand your opportunities, and provide valuable information to increase your profits.
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 the USDA’s Agricultural Marketing Service for movement and price data. The Index serves as a fair benchmark for industry price performance.
