October 09, 2023 | Industry News
October 2023 Regional Market Report News
This year’s cherry supply is significantly impacted by adverse weather conditions in the primary growing areas of California, Oregon, and Michigan. In California, production is down by an alarming 50% against the decade-long average, mainly due to a blend of cool temperatures, heavy rainfall, and insufficient pollination. Oregon's harvest similarly suffered from comparable climate issues, reducing overall yields. Meanwhile, Michigan experienced late fruit maturation due to unfavorable weather, causing decreased fruit tonnage. As a result, cherries will be in limited supply and face a price increase. To counter these challenges, we have ensured raw material availability for the season through our supplier relationships.
El Niño weather conditions in Peru continue to impact raw material availability across multiple agricultural categories, including quinoa. The latest update from farmers is that the outlook for the new season crop is poor and there is concern that there will not be sufficient raw material to meet demand. Roland Foods has a wide supplier base with multiple countries of origin and is working diligently to secure supply despite the raw material challenges in the quinoa category this season.
The La Niña conditions that adversely affected the availability of anchovies from Peru in early 2023 were immediately followed by El Niño conditions, exacerbating the raw material shortage. To secure ample inventory and avoid crop shortages we have expanded our anchovy sourcing beyond Peru.
Global Supply Chain and Logistics Updates
Import Levels Surpass Pre-Pandemic Averages
Following peak season for containerized imports, volume levels continue to outpace pre-pandemic averages. This influx is an indicator that retailers have been successful in reducing inventory and are expecting consumer spending to remain strong through the rest of 2023. This optimistic outlook has allowed shipping lines to increase freight rates with GRIs (General Rate Increases). The current rates on the transpacific line are near their year-to-date high.
An Update on the Panama Canal
Despite the restrictions and congestion in the Panama Canal, container shipping has not experienced the long transit delays other types of vessels are facing. The authority continues to give containerships priority for crossing, and if restrictions are not tightened further, we should continue to see cargo flow freely. At Roland Foods, we are hopeful that the canal will continue to operate with efficiency; however, we have contingency plans in place to ensure our products reach our warehouse.