Archive For The “News” Category
By Bob Rose
Vice President, National Produce Sales
Allen Lund Company
My daughter is a smart and caring teacher of young children in Seattle. She has been out of work for months and is doing fine, but obviously concerned about the job she loves.
Teachers’ salaries deserve more debate, but we acknowledge the societal importance. While I understand some companies have no choice but to lay off their workforce, what is surprising is the substantial number of layoffs and even changes in compensation plans for those employees in essential businesses that our society depends on.
The first quarter of 2020 was difficult for the produce industry and transportation providers like the Allen Lund Company. We are proud of how our company remained loyal to our customer base while truck rates skyrocketed. We added people to our staff to fill in key spots, quickly adapted new protocols to maintain clean and safe work environments, and we are flexible with some of our team members working from home in order manage the needs of our customers during these difficult times.
As we speak, my 401K looks a lot less like Swiss cheese and feels more like I can breathe. I’m sure this is more of a reaction the world will come back from this over time and erase the initial reaction we were all doomed, which we are certainly not.
What we should see is a speeding up of certain trends that were going to happen, just a lot earlier than we all thought. Trends like home delivery and home health care are at full speed.
Produce should be foremost in our thoughts as a process of health and wellness. I would imagine restaurants, gyms, and sporting events will return, but I’m hoping it would be a safer, new normal that will be better for everyone in the future.
Our produce clients have many challenges going forward. Innovation is all around us as change can be very positive and profitable once we all get over the shock of the suddenness of this movement. Stores such as 7-11 were born from the off shoot of their primary business of selling ice before the invention of refrigeration.
We are witnessing much stronger communication and collaboration from all parties and are hopeful our new way of working will continue as these issues subside. We expect the utmost ethical business practices are used as the economy rebounds and we all work together to ensure a robust and hopefully v-curved economic recovery!
People in our industry have always been able to work through challenges and adapt to whatever curveball is thrown. We are smart, focused, and live in an ever-changing environment. We are resilient in our business practices and the current extraordinary circumstances will be met with a positive “get it done” attitude.
bob.rose@allenlund.com
A new facility that helps move imported fresh fruit quicker to retailers and foodservice operators has opened at Port Manatee, Palmetto, FL.
The transfer facility, which opened in early April, frees dock space by moving trailers to an area that can park 120 trailers, according to a news release. It optimizes capabilities for expedited cargo movement by freeing up room for up to 300 containers.
“The trailer transfer facility could not be coming online at a more encouraging time,” Carlos Buqueras, Port Manatee’s executive director, said in the release. “The enhanced efficiencies this new installation facilitates already are proving vital in best utilizing port acreage to accelerate shipments of imported fruits and vegetables to consumers.”
The 3.6-acre site cost $916,000. It serves shippers that include Del Monte Fresh Produce, which imports bananas, pineapples and avocados from Central and South America, and World Direct Shipping, which imports numerous perishables from Mexico.
“Strategic investments in infrastructure, such as this newest facility, are essential to Port Manatee’s ability to best serve its users and, moreover, the consumers of our region and beyond,” Priscilla Whisenant Trace, chairwoman of the Manatee County Port Authority said. “This is particularly important amidst the COVID-19 pandemic, as we maintain essential operations while steadfastly focused on safety and health.”
BROWARD COUNTY, FL – Port Everglades is the newest stop on Evergreen Line’s CAJ weekly container shipping service to and from Panama, Jamaica and Haiti. Florida International Terminal at Port Everglades is the marine terminal operator for Evergreen, which has ships slated for arrival on weekends beginning May 2, 2020.
“Evergreen is a worldwide name in ocean shipping. Their presence at Port Everglades creates the opportunity for expansion into the Asian market,” said Glenn Wiltshire, Acting Chief Executive & Port Director.
Evergreen will have three vessels in the service rotation, which will include calls at Manzanillo, Panama; Colon-Coco Solo, Panama; Kingston, Jamaica; Port Au Prince, Haiti; Port Everglades; New Orleans; Houston before returning to Manzanillo, Panama.
About Evergreen
Based in Taiwan, Evergreen Line provides efficient shipping transportation throughout its global service network. The company operates some 200 ships, providing a capacity of approximately 1,270,000 TEUs. Evergreen Line maintains agency offices at more than 110 countries around the world, each providing superior transport services for local customers. More information about Evergreen Line and its services can be found at evergreen-line.com.
About Port Everglades
A global powerhouse for international trade, Port Everglades handles more than one million TEUs annually (20-foot equivalent units, the industry standard measurement for container volumes) and serves as a gateway to Latin America, the Caribbean, and Europe. Located within the cities of Fort Lauderdale, Hollywood, and Dania Beach, Florida, Port Everglades is in the heart of one of the world’s largest consumer regions, including a constant flow of approximately 112 million visitors statewide and 6 million residents within an 80-mile radius. Port Everglades has direct access to the interstate highway system and the Florida East Coast Railway’s 43-acre Intermodal Container Transfer Facility, and is closer to the Atlantic Shipping Lanes than any other Southeastern U.S. port. Ongoing capital improvements and expansion ensure that Port Everglades continues to handle future growth in container traffic. More information about Broward County’s Port Everglades is available at porteverglades
In recent years Texas has been accounting for a growing share of Mexican imports.
Grow Farms Texas of Donna notes volume gains range from Mexican berries to broccoli, cauliflower, Brussels sprouts, and celery and the company believes this is only the beginning..
USDA statistics reveal 2019 crossings of Mexican open field tomatoes were twice as high in Pharr, Texas, compared with Nogales, Ariz., and crossings of Mexican adapted environment-grown tomatoes were just 9 percent less in Pharr than in Nogales.
An important factor in the growth of Mexican imports through South Texas is the proximity to population centers, especially in the eastern half of the U.S.
In the next five to 10 years, Grow Farm Texas believes avocados will continue to grow along with tomatoes, cucumbers, broccoli, cauliflower, celery, lettuce and bell peppers.
USDA reports market shares for U.S. ports of entry for select commodities show:
- Avocados: Nogales, Ariz., 2 percent; Pharr, Texas, 45 percent; Tampa, Fla. (boat), 1 percent; Laredo, Texas, 51 percent, Otay Mesa, Calif., 1 percent; Progreso, Texas, 1 percent.
- Cauliflower: Pharr, Texas, 58 percent; Otay Mesa, Calif., 9 percent; Rio Grande City, Texas, 26 percent; Nogales, Ariz., 7 percent.
- Watermelon: Progreso, Texas, 21 percent; Rio Grande City, Texas, 3 percent; Pharr, Texas, 1 percent; Nogales, Ariz, 72 percent.
Freight volumes and rates took a hit in April thanks to the COVID-19 pandemic., according to transportation analysis firm DAT.
Transportation analysis company DAT of Portland, OR reports in a news release its DAT Truckload Volume Index, a measure of dry van, refrigerated (reefer) and flatbed loads moved by truckload carriers, fell 19 percent from March and 8 percent from April 2019.
“With so many businesses closed or operating at low capacity, truckload shipments have plunged, which put spot rates in dangerously low territory for owner-operators and small carriers,” Ken Adamo, chief of analytics at DAT, said in a news release. “Some carriers parked their trucks to wait for better business conditions, but there’s still lots of available capacity as a result of the low volumes, which has kept rates down.”
The April load-to-truck ratio for vans was 1.0 nationally, which DAT said was the lowest level since February 2016. In fact, for three weeks in April, the ratio was less than 1.0, meaning there were more trucks than freight posted on the DAT network, according to the release.
For the week of April 7, the USDA reported that fruit and vegetable truckload volumes were 110,327 (10,000-pound) units, down from about 147,016 units for the week of April 2 a year ago.
Spot reefer volumes were weak but ended April on an upward trend as fruit and vegetable harvests started to get underway. DAT said the reefer load-to-truck ratio was 1.7 in April compared to 5.6 loads per truck in March, matching at all-time low in April 2017.
The national average reefer spot rate was $1.92 per mile, down 25 cents compared to March and 23 cents lower year over year. according to DAT.
U.S. average diesel costs were much lower, at $2.39 per gallon in early May compared with $3.17 per gallon a year ago.
Truck Demand Should Improve
With the market bottoming out in April, the outlook should improve for truck demand.
Ratecast and Market Conditions Index—predictive metrics from DAT anticipate higher prices and volumes as states relax their stay-at-home orders, produce season begins and port markets like Los Angeles, Houston, Savannah, Ga. and Elizabeth, N.J., see more traffic.
“Carriers will not be able to sustain operations very long at current levels,” Adamo said in the release. “Spring produce shipping should offer some relief and put some needed upward pressure on prices in May.”
By Crowley Logistics
Crowley Logistics recently expanded its on-terminal, perishables handling capabilities by constructing a new USDA inspection dock in Port Everglades, Fla. The new $1.6 million dock has capacity for 80 refrigerated (reefer) containers, more than double the previous size, to better serve perishable shippers moving fruits and vegetables into the U.S. The new dock has individual shoreside power plugs for each reefer, allowing for continuous temperature control.
“This is a one-of-a-kind investment in the perishables market,” said Pat Collins, vice president, Crowley Logistics operations. “It allows for less handling time of the reefer container and cuts out the need to move the container to a separate location for separate USDA inspections. It also allows our trucking partners quicker access to assigned loads facilitating a quicker terminal turn time, allowing them to make more trips per day. Overall, it’s another upgrade we’ve made to more efficiently speed goods to market.”
Once a vessel arrives in Port Everglades, Crowley unloads the reefers first, which allows them to be immediately moved to the expanded dock for inspection and quickly released for immediate customer pick-up. If further inspection or fumigation services are required, Crowley offers a local service for that as well.
While reefers are at the inspection dock, they use electric power sources, allowing their diesel-powered generators to be turned off – a more environmentally friendly power option. The additional electric plugs expand the overall plug-in capacity for the terminal to over 260 plugs.
The new dock also has integrated features to promote safety for employees assigned to it. LED lighting facilitates brighter visibility for both our employees and our regulatory partners. Construction includes poured concrete and steel designed to withstand hurricane conditions and the everyday wear and tear of a marine terminal. And, the newly installed safety interlocked shore power receptacles have an LED indicator light to indicate to the reefer mechanic that the cable is energized.
Retailers are asking shipping companies to push back deliveries, which may drag global container shipments down as much as 30 percent in the next few months. The reason is warehouses are filling with goods ranging from refrigerators to washing machines.
The International Chamber of Shipping reports shipments have fallen an estimated 15 percent so far this year amid the coronavirus pandemic.
Second-quarter declines, compared with a year ago, will depend on how much governments reopen economies. Inventories of goods such as apparel, textiles, white goods, are full, and receivers of these goods asking shipping lines whether they can store these goods for a period of time or slow their ships down or basically delay taking delivery.
The slump is a setback for shipping giants such as Cosco Shipping Holdings Co. and Ocean Network Express Holdings Ltd., which started the year strong as healthy trade volumes allowed the industry to boost rates. That optimism has now evaporated as the virus outbreak is forcing shoppers to stay home, crimping retail sales in the biggest consumer markets.
Ocean Network Express notes forward bookings for shipments from Asia to North America and Europe have slowed for April and into May. Shipments of products from North and Latin America, Europe and Oceania to Asia are still strong. Ocean Network Express is Japan’s largest container-shipping operator.
In addition to lower volumes, the industry has been hit by restrictions aimed at containing the outbreak. Ensuring that seafarers can board and transfer onto ships amid port curbs and canceled flights remains a major challenge.
Fresh produce retail sales were up 22 percent for the week ending April 26, compared to the same time a year ago.
The market research company IRI reports demand for fresh produce is here to stay, at least for the foreseeable future. During the last week of April fresh vegetable sales were up 30.4 percent, while fresh fruit sales jumped 16.2 percent.
The numbers represent a substantial jump over the previous week, which was competing with the week of Easter in 2019. It also means the highest figures since the end of the demand peak in the middle of March.
A report by 210 Analytics, IRI and the Produce Marketing Association also points out sales of frozen and shelf-stable produce remain highly elevated, being up 57.6 percent and 46.3 percent respectively.
IRI reports the numbers very clearly show higher everyday demand is being driven by in-home consumption and it is here to stay for the foreseeable future.
As the market is adjusting to the new era of COVID-19, some lingering issues remain with the supply chain. Then there is the totally new shopping arena affecting everything from the demand for products to having to find new ways to drive impulse buying.
The top three growth items in the U.S. in terms of absolute dollar gains over the same week in 2019 were berries (+$35 million), lettuce (+$29 million) and potatoes, (+$24 million).
However, at the category level, significant differences continue existing between dollars and volume, driven by deflationary pressure. With fruit, there were big decreases in price per volume for items such as avocados (-16.1 percent), grapes (-12.5 percent) and tangelos (-9.9 percent) the week ending April 26.
Concerning vegetables, onions had a strong 37.3 percent increase in dollars. However volume sales were up 55.1 percent, with the retail price per volume down more than 11 percent.
Other produce items with large decreases in the price per volume were celery (-24.8 percent), peppers (-12.6 percent) and Brussels sprouts (-6.6 percent).
There was an opposite affect for other items, especially potatoes, with dollar sales still going strong, at +50.8 percent, and volume up 38.7 percent. Retail potato prices were 8.8 percent higher versus the same week a year ago.
As for fruit, the top 10 items in terms of dollar sales saw flat sales for two items (grapes and melons) but double-digit increases for seven.
Oranges continue a hot streak with another terrific 71 percent gain versus year ago. Highlighting nutritional benefits, particularly Vitamin C, in many other fruits and vegetables may benefit sales in weeks to come.
During the uncertainty caused by the COVID-19 Pandemic, the food supply chain has been called upon to create stability for the country. As the largest agricultural employer in the country, California strawberry farms were among the first to implement CDC guidance. Strawberry farms are committed to protecting farm worker health, maintaining farm jobs and harvesting every box for American consumers.
For consumers, strawberries have a special role, as one of the top two fruits designated as high in vitamin C. During the spring (April 15-June 1) strawberries are the second most consumed, high in vitamin C, fresh fruit, after oranges.
Now, strawberry supplies are threatened by the COVID-19 peak in April and downward trend into May – which has already brought food service to a standstill and stores to regulate consumer access.
Perishable items will be most affected by the COVID-19 peak, especially crops such as berries that will be in full production during the same period of April through May. Blueberry farms in Florida, Georgia, and California, as well as California strawberry farms project more than 30% of the crop will be disrupted – threatening the loss of thousands of jobs and hundreds of millions of dollars. For comparison, fresh strawberry retail sales were over $953 million during the 13 weeks ending June 16, 2019.
Our options are few: leave the crop to rot in the field or pick every box and have faith in our supply chain partners to get this important source of vitamins and nutrients into the hands of consumers, through supermarkets, food banks, online, and every other channel available.
Our choice is clear – harvest every box. We have asked the US Department of Agriculture for assistance and call upon every link in the supply chain to restock shelves and help us preserve over 70,000 jobs related to delivering healthy, nutritious strawberries to consumers, and for all to stay safe.
Sincerely,
Hector Gutierrez, Farmer & Chairman
Rick Tomlinson, President
WENATCHEE, WA: Furthering its dedication to being a leading fruit grower, packer and shipper in Washington State, CMI Orchards, LLC, is pleased to announce a new strategic partnership with Yakima Fruit and Cold Storage Co.
This partnership will significantly expand CMI Orchards’ manifest by adding over 3 million boxes of exceptional quality apples to CMI’s diverse sales portfolio. CMI President Bob Mast shared, “With this partnership comes tremendous opportunity to increase our daily shipping capacity with the expansion of packing facilities and high-density acreage. This added volume will enable significant growth for both companies and provides a robust portfolio to carry CMI and Yakima Fruit into the future.”
“This is all a part of a long-range plan for strategic growth to better serve our growers as well as our expanding customer base,” said Mast. “The design began to unfold back in 2018 when CMI Orchards added Pine Canyon Growers as a grower, packer and shipper. Pine Canyon Growers has been a fantastic addition to our manifest and now our progress has enabled us to team up with another great partner in Yakima Fruit.”
“Yakima Fruit has a highly desirable manifest that we are excited to add to our offerings, including exceptional early Honeycrisp among other key varieties,” said Mast. According to Mast, the partnership was executed on March 20, 2020, and has immediately added additional core varieties to CMI’s selling power. Varieties include Honeycrisp, Granny Smith, Cosmic Crisp®, Red Delicious, Pink Lady®, Gala, Fuji and Golden Delicious apples.
Mike Wilcox, President of Yakima Fruit, is excited that the partnership has been completed and said his company had considered many sales and marketing teams to team up with. “At the end of the day, there was no better choice than CMI,” Wilcox said. “CMI has proven time and time again they are innovation leaders, paving the way with many of the top-selling branded apple varieties in the U.S.A.” Wilcox added that he has always had tremendous respect for the CMI group, and the points of difference that CMI brings to the table to help retailers drive sales. “Having a strong core manifest is equally important, which is the value that Yakima Fruit adds to this partnership, as you have to be able to take care of customers’ everyday needs as well as bring something new and exciting to the table to keep apples exciting,” he said.
Mast reports that in addition to high production orchards, the Yakima Fruit partnership brings an opportunity to strategize on future plantings with available unplanted acreage to best meet the needs of CMI’s retailer and consumer preferences for both apples and cherries. “CMI is thrilled with the opportunity this blank slate provides and is eager to look into early cherry varieties, licensed branded apples and cherries, as well as high flavor, high quality core apple varietals.”
“This partnership will greatly increase CMI’s ability to service our customer base with fruit on a year- round basis. We are excited to have additional premium fruit to offer our customers and to continue to supply the highest quality fruit that we can, serving the needs of the market,” said Mast. “CMI is already known within the industry as being an innovator and leader for new branded items and organics, and this partnership will enable us to continue to pioneer advancements in these areas while expanding our fruit supply, meeting the needs of all of our customers. “We are very proud to welcome the Yakima Fruit team to the CMI Orchards Family and look forward to a long-lasting partnership,” Mast said.
CMI Orchards, founded in 1989, is the sales and marketing arm of McDougall and Sons, Columbia Fruit Packers, Double Diamond Fruit Company, Highland Fruit Company and Pine Canyon Growers. With 9 warehouses locations throughout the State of Washington, this new partnership will add one additional packing shed, greatly increasing CMI’s production capacity and efficiencies.
Yakima Fruit was incorporated in 1949 by the Cohodas Brothers Company of Michigan, a wholesale produce distribution company with branches throughout Michigan and Wisconsin. Following World War II service with the US Army Corps of Engineers, Herbert L. Frank relocated to Yakima, Washington to assume management of the recently acquired packing and storage facility. Subsequently, Yakima Fruit was managed by Lawrence C. Frank and then Michael C. Wilcox, a third-generation grower with sales and marketing experience. In April 2018, a majority interest in Yakima Fruit was acquired by Pioneer Partners LLP, an investment subsidiary of the Hancock Natural Resources Group.