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Outlook Promising in Processed and Fresh Markets

Weather issues last year pushed back blueberry harvest in Georgia, North Carolina and New Jersey. When Oregon growers entered the market a week to ten days earlier than in previous years, the industry had a lot of product on hand.

Adding to the glut, warm weather in April in Oregon created a condensed harvest season in Oregon. Come late June, when Oregon and New Jersey hit the market in a big way, the market suddenly was flooded with berries.

The glut dragged down prices and tested the capacity of many packing houses, said Mark Hurst, research and development director of HBF International in McMinnville, Oregon. It also showed just how strong the industry is, he said.

In a report to the Oregon Blueberry Commission at a recent meeting, Hurst said that the industry’s ability to move that kind of volume of fruit in a short time was impressive.
The processed market, meanwhile, was flush with carryover as the new crop came on last year. And with rabbit eyes from Georgia flooding the market at low prices, the Northwest price was in danger of slipping. Processors, however, held strong, Hurst said, and were able to obtain a decent price for the Northwest fruit.

With December 2013 holdings at 201 million pounds, the industry was poised for another big carryover this year, but, Hurst said, the industry moved 19 million pounds of fruit to the USDA School Lunch Program alone in February, removing a big chunk of carryover and putting stocks in balance.

Even if movement slows in the final weeks before new crop comes on, Hurst believes the industry can handle the carryover. Blueberry processors likely will be holding less than nine months of production in storage when new crop hits this summer. Cranberry processors, by comparison, are holding more than 18 months of production in storage at any one time.
Further reinforcing his belief that cold storage holdings are sustainable is the fact that prices for Grade A frozen increased in July of last year before leveling out, even with what some would consider big carryover volume on hand. Hurst believes processors can continue to demand good prices for Grade A processed fruit in 2014, particularly with Chile coming in at 25 percent below their projection.

“I think Chile will influence the processed market in the future,” Hurst said, “but this year, because of their short crop, I don’t believe they will be a factor.”

As for the fresh market, it is too early to tell the size of the U.S. crop, Hurst said, but to date, the crop looks good. On the plus side, reports are that the North Carolina and Georgia crops are closer to normal schedules this year, Hurst said. Florida, meanwhile, has gotten off to a late start.

“It is a lot of work,” he said. “We don’t do it for any other export market and we have good inspectors here and the phyto process is a very effective one.”

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