Reefers Needed, to Move Bumper Crops

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The USDA came out with their weekly market report today and indicated tight conditions for refrigerated equipment in SW Indiana, SE Illinois, Southern Michigan (melons), Nebraska, and the Columbia Basin in Washington state. It looks like they missed a few hot spots that brokers and carriers may wish to update:

Grapes in California – The California grape harvest has been hitting record levels for nearly three weeks. The grape harvest started in May and can extend into January. DAT sees strong evidence of constrained truck capacity in the Fresno market, where well over a thousand reefer loads were chasing fewer than 200 trucks yesterday, boosting the load-to-truck ratio to 6.5. The Fresno market includes Bakersfield and Santa Maria near the Pacific Coast, and much of the San Joaquin Valley. Further up the coast, Salinas and Watsonville are also stretched for equipment. Trucks are not nearly as tight in the southern part of the state, where the Santa Ana market continues to produce avocados and citrus with seemingly adequate truck supplies.

Apples Everywhere – Last year’s apple production was 2.7 million bushels in Michigan, and this year is projected at 30 million bushels, more than a 10X increase. Michigan’s load-to-truck ratio leaped to an average of 18 yesterday with strong load volume. The entire state looks tight for trucks, especially towards the western part of the state. Reefers in the Grand Rapids market faced a load-to-truck ratio of 36 yesterday. New York will also be back at or near full production this season. Last year, the Empire State produced 17.1 million bushels and is expecting a whopping 30.5 million bushels this year. Washington State is likely to be the top apple producer again at 143.9 million bushels, a decline of 7% compared to last year’s 154.8 million bushels.

Potatoes in Wisconsin – A shortage of both reefers and vans is plaguing growers in central Wisconsin — including Marshfield, Appleton and Green Bay. Yesterday’s load-to-truck ratio for reefers was 37 for the state, and the van ratio was 6.5, with well over a thousand load posts for each of the two trailer types. Bumper crops include cabbages and potatoes. Idaho also grows fall potatoes, of course, and volume is building in that state, as well, with more to come.

Bountiful Harvests – Crops are coming in strong all across the country. Favorable growing conditions have been reported in locations from Delaware, eastern Virginia, and New Jersey, to the Upper Midwest for Michigan, Minnesota, and Wisconsin, out to the West Coast where San Diego is seeing a strong tomato crop, and Oregon is producing grapes as well as tree fruit.

Timing May Lead to Labor Shortage – The only sour note I found was a concern that the timing of the seasons could result in labor shortages for some California crops. If growers must compete for skilled labor, the end result could be lower yields, higher prices, or both.

Sources: DAT RateView, DAT Hot Market Maps, USDA Fruit & Vegetable report for 9/4/2013, The Produce News and The Packer.

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