Prime Time expects market uncertainty
It’s a challenging time for fresh produce grower-shippers as the country inches out of the coronavirus-impacted year, but with no more certainty of consumer behaviors. Where will the buying patterns fall as restaurants open and more people start going out? Foodservice sales will probably climb, but will retail sales drop?
Those are difficult questions, and no easier to gauge than what growers were facing a year ago as the pandemic hit, and the nation shut down. Jeff Taylor, managing member of Prime Time International, based in Coachella, CA, said last March when the pandemic hit the company’s spring crops in Coachella Valley were already in the ground and there was no opportunity to alter the production schedule. However, they were able to cut back a bit on production for the summer, which was just going in the ground. It is a year later but how the consumer will react over the next few months is equally uncertain.
Taylor said Prime Time does have solid foodservice business as Bell peppers, the company’s signature crop, typically does produce a fair amount of foodservice grade product. Last year, that business was mostly loss, though retail sales took up the slack. “We have noticed that some of our foodservice accounts are coming back,” he said. “Things are opening up. Down here in the desert, it is packed, and the restaurants are full. It’s hard to get a reservation.”
But Taylor does not know how retail will respond. Prime Time did increase its summer production a little bit over last summer, but its Coachella Valley acreage has remained the same. Taylor said it could be a challenging spring as weather has produced perfect growing conditions for the spring desert deal, just as it did for many of the winter production regions for peppers. “It’s been a challenging couple of months,” he said, noting that you need some hiccups in production areas to make the market.
Speaking on April 14, Taylor said red peppers were being sourced in Baja California but would move to Coachella in a couple of weeks. Prime Time had eggplant, sweet corn and chili pepper acreage moving toward harvest with watermelons slated to begin on May 10. Typically, the Coachella row crop deal starts in April and lasts until around June 10, as long as the temperature doesn’t get too hot.
Prime Time then farms acreage in the San Joaquin Valley and Ventura County to fill summer orders.
Another worrisome subject for Taylor is truck rates. “We are going to be in trouble,” he said, speaking of summer rates. He noted that on this mid-April day, the rate from Nogales to Boston was $9,300, that equates to close to a $10,000 rate from California, and it’s early spring. “We were talking to a trucker today who is idling eight trucks because he can’t get any drivers.”
Taylor opined that the long-haul truck driver pool is being depleted by demand in the home delivery arena. Those same drivers can work close to home and go home every night. He said others are just afraid of traveling cross country and aren’t willing to take the risk. The lack of truck supply has been driving rates up for most of the past year. It remains to be seen what price point will be necessary to create more supply.