The outlook for fresh vegetables this winter features a 5-percent reduction in acreage and reduced availability of some warm-season crops like green beans and sweet corn due to a February freeze in Florida, according to the latest USDA Vegetables and Melons Outlook.
At the same time, demand is expected to remain soft as consumers spend conservatively. Given supply reductions, the winter price outlook favors higher prices compared with the relatively low levels of a year earlier.
Cold early December temperatures in California and several nights below freezing in Florida slowed growth, singed crops, caused bloom drop, created gaps in supply, and raised farm prices for several fresh-market vegetables.
In Florida, winds and freezing temperatures (as low as 23 degrees F.) reached down into the major Gulf Coast vegetable areas around Immokalee and Belle Glade on Jan. 20-22 and again on Feb 5. The west-central inland growing areas appear to have had the lowest temperatures and the most severe damage, with damage less severe along the East Coast and the Homestead area (where the majority of the winter snap bean crop is produced).
Damage was reportedly most severe for portions of the late winter/early spring snap bean and sweet corn crops. Due to ample freeze warnings and strong grower counter-measures, crop damage was limited and product shipments were able to continue with minor delays.
Because much of the damage occurred in areas growing for the late winter or early spring harvest, any price impact for crops like snap beans and sweet corn may occur in the near future as delayed shipments miss anticipated market windows.
Most tomato plants survived the cold weather, but generally when the temperature dips below 50 degrees for an extended period of time, tomato plants will begin to drop blossoms. It then takes about two weeks for undamaged plants to reset new blossoms. As a result, a price surge could occur this month as shipments decline due to the loss of blossoms that would have matured into marketable product.
In early February, mature-green tomato prices were averaging around $9.45 per 25-pound box — up from the lows of early January, but about 30 percent below the relatively strong levels of a year ago.
The value of production for all fresh-market vegetables totaled a record-high $10.4 billion in 2008, up 4 percent from a year earlier. Tomatoes replaced head lettuce (due to higher tomato prices) as the top fresh vegetable at $1.4 billion — up 21 percent from a year ago.
Increases for bell peppers (up 26 percent), tomatoes (up 21 percent), and squash (up 17 percent) easily outweighed declines for chili peppers (down 21 percent), romaine lettuce (down 19 percent), and celery (down 17 percent).
Fresh-market gross revenue increased just 1 percent to $5.3 billion in California, which accounted for 50 percent of the national value of fresh-market vegetables, compared with 52 percent a year earlier. Production of fresh vegetables generated nearly $1.6 billion in crop value in Florida — up 15 percent from 2007 as higher prices outweighed reduced aggregate production.
The value of melon production totaled $931 million in 2008 — up 17 percent from 2007. Record-high yields pushed watermelon production higher and good demand pulled average prices up, leaving crop value up 17 percent to a record $492 million.
Although the value of the honeydew crop fell 8 percent, higher prices pushed the value of the cantaloupe crop up 23 percent to $371 million.
The outlook for the remainder of the winter season is largely dependent on the weather in southern Florida, various areas in Mexico (particularly Sinaloa), and the desert growing regions of California and Arizona. The outlook for fresh vegetables is as follows:
Demand is expected to be soft as consumers are cutting back on purchases of fresh produce for both away-from-home eating and as premium products (such as hothouse vegetables) for home consumption due to rising unemployment and income insecurity.
Given supply reductions, the winter price outlook favors higher prices compared with the relatively modest levels experienced a year earlier. Although some input prices have eased, growers also continue to face relatively high input prices this winter, especially for fertilizer, chemicals, land rent and seed.
This winter (largely January-March), fresh-market vegetable and melon area for harvest (excluding onions) is expected to decline 5 percent from that of a year earlier.
Acreage for harvest of the 11 selected vegetables fell to 150,900 acres this winter season, with area down in three of the four producing states.
California, which accounts for 47 percent of winter vegetable acreage, reduced area 5 percent, with acreage lower for each crop except cauliflower. Arizona, which harvests 20 percent of winter area (concentrated mostly in lettuce), expects to harvest 10 percent less area this winter. Growers in Florida, who have 27 percent of winter area concentrated largely in warm-season crops such as tomatoes, peppers and snap beans, expect to harvest 5 percent fewer acres. Acreage increased in Texas this winter, with growers planting more cabbage, but keeping spinach and carrot area constant.
Winter-season area for harvest accounts for about 9 percent of the annual fresh vegetable and melon harvested area (1.73 million acres in 2008), with imports contributing a larger share of shipments than during any other season.