Hunts Point Wholesale Produce Market is the largest produce terminal in the world, moving 3 billion pounds of fruits and vegetables from 55 countries and 49 states through its stalls each year. The 113-acre complex has more than 1 million-square-feet of shop and storage space, houses 42 merchants, employs 10,000 people, and generates $2.4 billion in sales annually.
Hunts Point, located in the South Bronx, serves New York City and the tri-state area (New York, New Jersey, and Connecticut), bringing fresh produce to an ethnically diverse population of more than 23 million. The terminal facility sells to retailers, secondary wholesalers, restaurants, and other foodservice outfits.
For over 10 years Hunts Point has faced a challenge due to operating in a 1960s-era facility that’s both in need of repair and has been outgrown.
Storage is limited, and the layout was built for smaller trucks than today’s 53-foot trailers. Infrastructure (including electrical needs) is inadequate, and the cold chain is a challenge. Over the past several years, there’s been questions, if rebuilt, is there enough room on the existing campus to accommodate a new market that will last the next 50-plus years.
PRODUCE FREIGHT RATES
A combination of fewer trucks due to the economy reducing the number of owner-operators and carriers, plus fuel costs led to what wholesalers claim were record freight rates last summer.
“Freight has been very rough,” says Hunts Point wholesaler Jim Hunt. “Up until July Fourth, freight out of California to New York was astronomical, in the $8,500 to $9,000 range. Also, trucks were hard to come by, and this is something we will have to deal with going forward.”
“It gets broken down as a function of the delivered cost,” explains Hunt. Hypothetically, if freight is $8,000 or $9,000 for a 20-pallet truck, the f.o.b. price is $5 per box. And if the freight is another $5, this puts the merchant in at $10. “If you’re trying to make 15 percent, you have to gun for $12 and fall short at $11,” he said.
“If freight were to continue to go up the way it has, it would be unsustainable for the produce industry,” concedes wholesaler Matthew D’Arrigo. “But the beauty of our industry is that we don’t have government regulations setting freight rates; we have the laws of supply and demand.