Dear Members,
What a difference a year makes. Last year at this time, we were facing significant market challenges. We had just come off one of the worst marketing years, and we were fighting to try and return pricing to profitable levels for most. Those efforts were unsuccessful as the pricing slide continued, and much of the season saw more significant losses.
As March rolled around, we started to gain some positive momentum through significant factors. Those factors include tariffs on citrus exports to China, which were cut in half. In addition, the global pandemic had consumers rushing for Vitamin C. For most of the industry, we caught up to where we should have been for most varieties, excluding lemons, who had significant challenges due to foodservice.
Expectations across the industry are that the movement and pricing will continue in a positive direction as we start the season. It is much needed after many growers incurred negative returns for two consecutive years. We cannot lose sight of that and must continue to push the industry to keep pricing up.
Last March, CCM published the Navel Cost of Production Survey. It showed an average farming cost of $3,300 an acre and total costs of $8,200. The survey also identified that increased costs were driven by higher labor costs, which will only continue due to another minimum wage increase as we head to $15 per hour by 2023. The survey emphasized the need for all growers to look at your production cost and communicate with your packer/marketer.
We may be seeing a bit of a reprieve due to the coronavirus, but this is no time to let down our guard. Communicate often with your packer and marketer to maximize quality and return for your operations. The demand is there; good communication and patience in the marketplace will be essential for a successful season!
Sincerely,
Casey Creamer
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