Produce markets tend to remain in a narrow price band throughout late summer and early fall, August to October.
This year, at $0.75, values are near the middle of the 10-year range, from $0.59 to $0.84. Prices typically stay mild until Thanksgiving creates a surge in demand the second and third week of November.
Blue Book has teamed with ProduceIQ 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.
ProduceIQ Index: $0.75 /pound, +4.2 percent over prior week
Low yields (with low quality), caused by hot California weather, are driving the entire Lettuce & Leaf category significantly higher, +29 percent. Iceberg led with an impressive bounce, +59 percent, though the gain was from a low floor price ($0.17/ pound).
At $0.27/ pound, Iceberg has significant runway (and experience) in reaching prices that exceed $0.50/ pound. Anticipate continued price gains in the category as demand-exceeds-supply.
Price gains were also realized in Dry Vegetables, Wet Vegetables, and Berries (except for Blackberries).
Asparagus was this week’s biggest loser and fell to a 10-year low, to $1.56/ pound. The irony of these very low prices is that quality is high. Increased supply, irrespective of quality, causes low prices.
When markets have low prices, growers tend to pick and grade “tighter” because only the highest quality will have market demand. Many consumers would incorrectly expect that quality and price are positively correlated, rather than the inverse.
Quality supplies are anticipated to continue from Mexico and Peru. Now, it’s time to promote Asparagus.
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.
