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Apple prices stable despite drop in sales to China

With less than one third of Washington’s large apple crop sold, prices show signs of stabilizing and maybe increasing but sales to China, a top export market, are down.
Dan Wheat

Capital Press

Published on January 9, 2018 8:39AM

Last changed on January 11, 2018 3:41PM

Ana Delgado loads a box tray with Ambrosia apples at McDougall & Sons’ Baker Flats packing plant, Jan. 5. A managed variety, Ambrosia wholesales sell at about $40 per box.

Dan Wheat/Capital Press

Ana Delgado loads a box tray with Ambrosia apples at McDougall & Sons’ Baker Flats packing plant, Jan. 5. A managed variety, Ambrosia wholesales sell at about $40 per box.

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WENATCHEE, Wash. — The size and prices of Washington’s apple crop appear to have stabilized while exports to China are down 40 percent but some say could recover.

The industry’s Jan. 1 storage report shows the 2017 crop at 142.3 million, 40-pound boxes, the same as a month ago. It’s an estimate of what was picked and placed in storage, what’s been shipped so far and packout versus cullage of fruit still in storage. It is second only to the 143.6-million-box crop of 2014.

Crop size should remain stable for the next several months unless there’s some unforeseen increase in cullage, said Desmond O’Rourke, retired Washington State University agricultural economist and world apple market analyst.

“How rapidly the industry moves the crop is the big question and so far things look positive. The dollar is relatively weak and exports, except China, are holding up very well,” O’Rourke said.

So far this season, 579,000 boxes of Washington apples have been shipped to China compared with 957,000 at the same time last year.

“I’ve been warning people to be cautious about China,” O’Rourke said. “There are a lot of thumbs on the scale in China.”

Todd Fryhover, president of the Washington Apple Commission in Wenatchee, said China has a huge crop, exported 10 million boxes of apples to India last year and has been banned from India this year. Chinese importers pulled back early in the season when a shipment of Washington Gala was in poor shape and Chilean cherries were stiff Christmas competition.

China has improved packaging of its high-end apples to its own high-end markets and China is a crowded market among international competitors making this a “challenging” season, Rebecca Lyons, the commission’s export marketing director, reported to the commission Dec. 14.

Chuck Zeutenhorst, general manager of First Fruits Marketing of Washington in Yakima, said he’s not worried, that exports had a slow start this season due to a later harvest but are only 2 percent behind a year ago.

“We are just getting going. Exports are picking up. I think we will turn the corner and numbers will change dramatically,” he said.

O’Rourke said exports to Asia and the Middle East will pick up because of lighter European apple crops.

Washington apple exports are 12.3 million boxes compared with 12.6 million a year ago. Export and domestic shipments total 41 million boxes versus 46 million a year ago and 40 million two years ago.

“We are behind where we would expect to be with this size of crop because of the late harvest,” O’Rourke said.

Washington’s largest apple export market, Mexico, is down 5 percent and Canada, second largest, is down 17 percent, he said. India is up 27 percent at 898,000 boxes so far, he said.

Wholesale Washington apple asking prices on main varieties are unchanged in the last month or two, according to USDA, with the exception of a $2 per box increase in size 88 Granny Smith and size 80 Honeycrisp in the last month and a $2 drop in size 88 Fuji.

Red Delicious remain at $14 to $17 for 80s and 88s and Gala remains at $18 to $24 on 80s and $16 to $22 on 88s.

O’Rourke said it’s too early to know if prices have bottomed. Zeutenhorst agreed while noting a shift to greater volume of smaller fruit is creating price stability in larger sizes. Size 113 (113 apples per box) now appears to be peak size, he said.


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