Volumes remain low following early finish to heat-affected Mexican table grape season.
The California table grape industry has seen its fair share of change in recent years. It seems almost every season growers from Coachella to Fresno are confronted with fluctuating circumstances well beyond their control with the potential to threaten their businesses. These include rising costs of production, labour shortages, declining exports as well as an increasingly volatile climate. What hasn’t changed, unfortunately, is the consumption rate of table grapes in the US, which has remained essentially flat for decades.
Export markets have long been counted on to absorb a certain percentage of California’s annual table grape production and to help support domestic returns. However, with the advent of the Covid-19 pandemic and its lasting impact on the global supply chain, less fruit has found its way to foreign markets over the last several seasons as shippers have been reluctant to export on substantially prolonged sea voyages. According to USDA data, total US exports of fresh grapes fell by 24 per cent between 2019 and 2022, while shipments to the Pacific Rim dropped 49 per cent.
Last year, exports reached their lowest level since 1989 due to a rare tropical storm that slammed the San Joaquin Valley in late August, destroying an estimated 25m cartons worth of fruit yet to be harvested. Exports could be impacted again this season as the 2024 summer is already one of the hottest on record, exceeding 38°C every day from 2 July through to mid-month – and frequently topping 43°C. Such prolonged heat has caused grape vines to shut down metabolically, affecting sugar development, impacting colour in red varieties and potentially delaying the 2024 San Joaquin harvest.
“The heat has just been incredible so far and has really kept a lid on volume,” said Brian Crettol of Jasmine Vineyards in the second week of July. “Mexico and Coachella are both done and the trade wants to switch to the San Joaquin but the supplies just aren’t there yet.”
San Joaquin growers have become accustomed to contending with the presence of Mexican fruit lingering in domestic supply channels through much of July every year. That’s not been the case this season as Mexico’s production fell short of initial estimates due to their own heat issues finishing the season early.
While shipping more fruit than last season, the Coachella Valley has seen its production drop off substantially in the last couple of decades due to shrinking acreage. Consequently, supplies of table grapes have been unusually short across North America in recent weeks, keeping FOB prices abnormally high.
“Both Flame and Sugraone Seedless (varieties) are running between US$26 to US$28 at the moment,” Crettol said. “We’ll see the first of the premium varieties in another week or so but these will be even higher in price. Until this heat lets up, I don’t see any promotable volumes (of grapes) until sometime in August.”
Short supplies have reportedly not been a problem for shippers to start the San Joaquin deal, however. According to Anthony Vineyards’ vice president of sales, John Harley, the vineyard has been packing fruit in good volumes since late June as it owns some of the earliest-bearing acreage in the valley.
“Our business has just been ‘screaming’ the last few weeks,” says Harley.
He adds that Anthony Vineyards’ San Joaquin inventories are supplemented by fruit repositioned from their Coachella operations with stocks of proprietary varietals that are preferred by retailers.
“Our Flames from Arvin (near Bakersfield) have size and colour and with repositioned fruit from our Coachella deal, it’s been a good start to the season for us. It also helps that there’s been little overlap with Mexico this year.”
However, Harley says that overall volume in the San Joaquin could be reduced during the course of the season unless temperatures moderate.
“You could easily see sunburning occur in some of the later varieties because sugar levels are still quite low,” Harley says. “That might not be a bad thing, however.”
Harley refers to the fact that late-season California grapes are increasingly impacted by imports from South America, particularly Peru.
“I used to sell fruit well into December every season,” said Crettol. “No longer.”
Not that many seasons ago, California regularly shipped more than 110m cartons of fruit annually. However, competing foreign production on both ends of the San Joaquin season, combined with flagging international demand, has led to speculation that more San Joaquin grape acreage may need to be removed to bring supplies better in balance with demand.
“The California industry can still be profitable with production at the low 90m carton level, which is where it’s basically been the last few seasons,” says John Pandol of Pandol Bros. “Volume this year is shaping up to be similar to pre-Hurricane Hilary levels and with the proper quality, we should have a successful season.”
