Thursday, January 5, 2012

Fickle markets

Squash is hot, lettuce is cold.  So go the markets this morning.  A little cold weather in Florida has the brokers in Nogales dancing in the streets, while warmer weather in Yuma is depressing everyone from growers to truckers as lettuce, broccoli and cauliflower piles up in coolers.  Meanwhile, the vaunted market system has atrophied to the point where chain stores blithely continue with advertised specials planned 6 weeks ago when there is no product available and ignore piles of cheap produce because it is not in the plan.  When I first started in this business, a produce buyer had wide latitude to adjust prices and specials on the fly.  Cauliflower is unexpectedly cheap, then let's put an in-store special.  The squash you advertised for next week is frozen, no big deal, we'll promote potatoes instead.  This can do attitude has been replaced in most chains with a by the numbers mind set which assumes broccoli and spinach are the same as manufactured widgets.  In this bizzaro produce world, if the squash froze, you either buy against the account of the hapless grower or broker who guaranteed the availability, or you put up a sign in the produce dept. lamenting the vagaries of the weather and promising to do better at some unspecified time in the future.  Then raise the prices of some plentiful produce item to bring your bottom line into balance.  The grower or shipper then dumps trailerloads of whatever item was priced out of movement at retail and vows to not plant as much next year.  There are cordial relations between buyers and sellers, but the fundamental equation that obtained 25 years ago is now invalid, since the bottom line of the buyer has replaced the market driven system.  This disconnect is harming the ability of the American farmer to supply affordable produce to the consumer.  What needs to happen is to give the buyer the ability to change on the fly and take advantage of abundant supplies on the spot market.  Will it happen?  I doubt it, as long as buyers are treated as little more than button pushers, and growers are expected to produce advertised specials on demand, regardless of weather conditions.

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