Falling Vegetable Prices

Supplies of fresh market vegetables are strong and steady, which is causing a reduction in price, according to the recent Vegetables and Pulses Outlook report from USDA’s Economic Research Service.

Formerly known as the “Vegetables and Melons Outlook,” the report states that the early year freeze in Florida had a minimal impact on supply, as production mainly took place in the southern part of the state.

On the other side of the country, California tomato processors plan to contract for 3% more tomatoes in 2012, according to crop intention reports. If the plan is for growers to continue increasing yields, the total 2012 U.S. processing tomato crop could top 13 million tons — the second-largest crop on record.

Potato production also has been on the rise and in 2011, it increased almost 6%. The 7% increase in acres planted and harvested in 2011 raised production despite slightly smaller yields. According to the report, stocks were reduced and prices higher after the 2010 season. The 2011 crop sales, which extended into 2012, are expected to slow compared to sales in the previous crop-year.

In spite of expectations that demand for fresh vegetables will continue a “slow growth” as consumers continue to improve their diets, prices are not expected to climb. If no spring-freeze damage occurs, the seasonal price outlook “strongly favors prices well below those of a year earlier,” the report states.

To read the March 30, 2012 Vegetables and Pulses Outlook, go to www.ers.usda.gov/Publications/VGS/2012/03Mar/VGS349.pdf.