News and Stories

UPDATE: Market and Supply Forecast for the Desert Region

January 16, 2015

The Arizona/California desert season will continue for approximately 11 more weeks before growers make the seasonal transition to the San Joaquin Valley/Huron and Salinas, California. Volatile prices and quality problems are expected to persist in many commodity crops such as broccoli, cauliflower, celery, green leaf, iceberg, and romaine.


Current Supply/Prices

Abnormally warm weather in November and December pushed harvesting ahead of schedule by several weeks

Two weeks ago, the region received consecutive days of freezing temperatures that stunted growth, caused a severe supply gap, and pushed up market prices

Industry-wide quality issues such as epidermal blistering and peeling will persist in leafy green and lettuce items for at least two to three more weeks; expect low yields and carton weights

Most growers are one to four weeks ahead of schedule, meaning they will run out of supplies before the end of the season

Industry stocks remain limited, but high prices have weakened demand

o Many commodity markets have peaked at current levels

o Prices are expected to ease in the coming days


Future Supply/Prices

Mid- to high 70s to low 80s are forecast in the desert region for the next 10 days; freezing temperatures are not expected

Although in the short term, supplies will increase and demand will weaken, elevated prices will dominate the market until the transition north

There are three main factors that will impact the rest of the desert growing season

o Temperatures:

If warm temperatures persist, growth will increase and push harvesting ahead of schedule, resulting in a gap/supply shortages at the end of the season

If temperatures drop to freezing levels, growth will slow, supplies will tighten, and prices will rise

o End of season gap:

  If growers remain this far ahead of the production schedule, growers will start harvesting fewer acres in an effort to extend product through the end of the season

  Persistently high prices will weaken demand

o The San Joaquin Valley/Huron, California Season:

Growers have historically moved from the desert to the San Joaquin Valley/Huron area for several weeks before they transition to the Salinas Valley

Fewer growers will make the move to the San Joaquin Valley/Huron for the spring 2015 season due to extremely high water costs

Most companies have elected to extend the desert season and move straight to the Salinas Valley for an early start (skipping the San Joaquin Valley/Huron region altogether)

If temperatures are extremely warm in the desert at the end of the season, quality and supply will diminish

If weather is cold and rainy in the Salinas Valley, growth will be slow and plants will not be ready to harvest

Because many growers do not plan to plant in the San Joaquin Valley/Huron during the transition period, there is uncertainty in the industry

Elevated prices are forecast until the Salinas Valley season is fully underway


 Please contact your Markon customer service representative for more information.


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