The first U.S. arrivals of Argentine lemons have taken place. "It's not much volume yet. We'll start bringing in more volume around the 1st of June when the programs kick in," says G.T. Parris of Seald Sweet, adding that its import lemon program also includes Chilean and Mexican lemons.
For Argentine grower-shippers, the season could look a little different this year following a growing season of good weather that did not include the heavy rains before shipping that were seen in the past. While the country has taken its time over the past few years to improve the quality of the fruit and to get to know the U.S. market in terms of specs needed and optics of the product, it's also historically oversupplied the market. "Each year they pushed up volume and it created a bit of soft pricing," says Parris.
That said, this season, there's more competition for Argentine lemons. The juice and essential oils market for example has historically been on the lower side but this year, it's stronger which is offering one outlet for lemons. "Europe is also taking Argentinian lemons which they didn't last year. So now there's competition out there and America may not be quite as attractive," says Parris.
Assisting with pricing
That potentially tighter lemon market should garner a better price though on the spot market, depending on how tight supply looks in July. "We're already seeing less shipments to the U.S. This should keep the market not oversupplied and fairly attractive through July. If prices stay strong, that just helps out the Chilean market too."
Tariffs on product imported to the U.S. will also be a factor in that market–both Argentina and Chile are subject to the 10 percent flat tariff on imports into the U.S. "Everybody understands it and most buyers are willing to participate but don't want to absorb the whole 10 percent," says Parris.
However, as the importer of record who has to pay those tariffs upon receiving the product, it's made for a bit of an accounting headache. "Everybody is finding out really quickly about having to pay those up-front tariff fees," he says, adding that the company has had to dedicate staff to ensure all the tariff requirements are being met.
Meanwhile, the upside of less product this season is that the good quality of the product will be easier to maintain. "When it's not oversupplied, the coolers won't be as full of lemons so on retail, you'll have fresher lemons and that should help buyers. This should all make for a better year," says Parris.
For more information:
G.T. Parris
Seald Sweet
Tel: +1 (772) 569-2244
www.sealdsweet.com