February 23, 2017 OVERVIEW

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Russell Beasley
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February 23, 2017 OVERVIEW The previous month s adversely unstable weather conditions in the Yuma

The unusual weather has created industry wide shortages in supply on multiple items including:

Avocados are back in an extreme market as supply is limited and prices are high.

industry will experience issues with supply for romaine/mix lettuce, romaine hearts, broccoli and

These issues are a result of the warmer than normal weather conditions that have taken place

far ahead of schedule as 2-3 weeks on a high side (romaine/mix and romaine hearts) throughout the

Growers have tried to do what they can to slow product growth and minimize the supply shortage

Yuma. In regards to Salinas, the extremely wet and colder than normal weather during the Salinas

forward as much as possible to mitigate the potential supply gap, but this has been extremely

1 February 23, 2017 OVERVIEW The previous month s adversely unstable weather conditions in the Yuma growing region are still causing quality problems, lower overall weights and yields. The unusual weather has created industry wide shortages in supply on multiple items including: broccoli, cauliflower, and cilantro. Avocados are back in an extreme market as supply is limited and prices are high. FORECAST FOR NEXT MONTH: Over the next three to five weeks (now through the end of March) the industry will experience issues with supply for romaine/mix lettuce, romaine hearts, broccoli and cauliflower. These issues are a result of the warmer than normal weather conditions that have taken place since start of Yuma and product being 1-2 weeks ahead of schedule (broccoli/cauliflower) and as far ahead of schedule as 2-3 weeks on a high side (romaine/mix and romaine hearts) throughout the entire Yuma growing season. Growers have tried to do what they can to slow product growth and minimize the supply shortage but unfortunately, its easier said than done when mother nature brings the product forward in Yuma. In regards to Salinas, the extremely wet and colder than normal weather during the Salinas planting season (January/February) has our growers are doing all they can to try to bring product forward as much as possible to mitigate the potential supply gap, but this has been extremely challenging with temperatures ranging in the mid 50 s to low 60 s plus January and February being some of the wettest months on record. In the next 5 weeks we will see shortages on product. We will keep you updated weekly. MARKET ALERTS ASPARAGUS - EXTREME AVOCADO - EXTREME CAULIFLOWER- EXTREME CELERY - QUALITY CILANTRO - EXTREME GARLIC - EXTREME LEMONS (SIZING)

GOOD BUYS TOMATOES ROUND, CHERRY AND ROMA Did you know that tomatoes are considered one of the world's healthiest foods. Tomatoes are a treasure of riches when it comes to their antioxidant benefits.

In regards to phytonutrients, tomatoes are basically off the chart. With all the rain in California and shortages in of cauliflower and broccoli try a tomato salad!

For a meal, serve with chicken or fish drizzled with a vinaigrette.

Serve it warm or at room temperature, though the leftovers taste great cold if you have any!

2 GOOD BUYS TOMATOES ROUND, CHERRY AND ROMA Did you know that tomatoes are considered one of the world's healthiest foods. Tomatoes are a treasure of riches when it comes to their antioxidant benefits. In terms of conventional antioxidants, tomatoes provide an excellent amount of vitamin C and beta-carotene; a very good amount of the mineral manganese; and a good amount of vitamin E. In regards to phytonutrients, tomatoes are basically off the chart. With all the rain in California and shortages in of cauliflower and broccoli try a tomato salad! You can make a great Caprese salad with fresh tomatoes and mozzarella that has never tasted better. Yum! Try a fresh salad with a mix of lettuce, basil, and grape or plum tomatoes. For a meal, serve with chicken or fish drizzled with a vinaigrette. Or try Tomato Galette - tender parmesan-pepper pastry cradles heirloom tomatoes, shallots, goat cheese and fresh herbs in a fold-over tart that's ideal for weekend brunch. Serve it warm or at room temperature, though the leftovers taste great cold if you have any! TENTATIVE TRANSITION SCHEDULE COMMODITY FINISH SALINAS START YUMA START IMPERIAL VALLEY Lettuce Nov 2nd Nov 4th Dec 7 th Romaine / Green Leaf Nov 20th Nov 15th Nov 14 th Broccoli Dec 7th Nov 20th Nov 20 th Cauliflower Dec 10th Nov 25th Dec 14 th Celery Dec 1st Jan 15 Oxnard - Nov 15th TRANSPORTATION & WEATHER Trucks are in adequate supply in all districts including the Northwest, Southwest, Texas and Florida. More wind and rain are in the forecast this weekend for California districts. The heaviest precipitation will occur in central & northern California, with 1 2 inches at the coast and ¾ - 1 ½ inches in the inland valleys. Southern California will see about ¼ inch, with less in the desert. A cooling trend will cause daytime highs to decline into the 50 s in central California, with low s at-or-below freezing on Friday. High s will be in the 60 s in the desert, with low s in the 40 s. Clear skies and mild temperatures will continue in central Mexico, with highs in the 80 s and low s in the 40 s. Weather conditions in south Florida were cool on Wednesday, accompanied by an inch of rain. Significant rainfall has also curtailed the strawberry harvest in central Florida. The remainder of the week will bring generally clear skies and mild temperatures to Florida districts, with highs in the upper 70 s & low 80 s and low s in the 40 s & 50 s. FRUITS & VEGETABLES AVOCADOS EXTREME MARKET We continue to see a shortage in supply and prices rising. We expect this to continue to get worse particularly on larger fruit as the size mix shifts to the heavier fruit. BANANAS Demand and quality are good and supply is steady. GRAPES Supplies are improving and demand is lighter than expected. Sugraone and Flame pricing is down this week.

3 BLUEBERRIES Quality is outstanding on blueberries from Central Mexico. Peak production will continue through February, with the season finishing by June. Baja California, Oxnard and Santa Maria will begin to increase their volume moving forward. Chile is finished for the season. BLACKBERRIES Cooler weather in central Mexico has delayed the anticipated increase in production. We expect to have good supplies by late early March. RASPBERRIES Production volume remains strong in central Mexico, supplemented by Baja California. Oxnard availability declined this week due to the heavy rain that occurred late last week through Tuesday of this week. Production is expected to recover by early March. Overall, raspberries are in good supply that will continue to increase going forward. STRAWBERRIES Availability overall has tightened due to weather conditions in various growing areas. Rainfall totals for Wednesday in central Florida have been higher than anticipated, causing growers to curtail harvesting. More than five inches of rain fell in Oxnard during the six-day period that ended Tuesday. This leaves central Mexico as the strawberry district that has been least affected by weather. Prices have rebounded in response to increased demand. Additional precipitation is in the weekend forecast for Oxnard. CALIFORNIA-ARIZONA CITRUS ** Rain has continued to hinder citrus harvests in California. There is another couple inches of rain expected by the upcoming weekend. Smaller, choice grade fruit has been very hard to come by. Most supplies are of the larger, fancy grade fruit. GRAPEFRUIT Texas grapefruit is packing, good supplies of 40s and smaller. Florida red and dark red grapefruit will be finishing up at the end of February. Grapefruit quality has been very good this year. LEMONS Volume is expected to be low for the next couple weeks. Very tight on 165s and 200s. Mostly large, fancy grade fruit. LIMES (PERSIAN) Limes are available in good supplies, packing in Texas and California. Great quality and color. ORANGES Navels: Supplies are expected to increase by the beginning of next week, depending on the weather. Quality, flavor and internal color are good. Larger, fancy grade due to recent weather. Specialties: Minneola Tangelos and mandarins are available, great quality and color. Blood oranges are in good supply, great color. Cara Caras are available, excellent color and quality. Pummelos are in the final week of harvesting. PINEAPPLE Supply will be tight through next week. Please order ahead. CALIFORNIA LETTUCE GREEN & RED LEAF Supplies on green leaf are better. We are seeing a lot of dirt due to the heavy winds, seeders and tip burn. We are seeing very short supply on red leaf, however quality is good. Prices are high on both.

ICEBERG LETTUCE Supplies of iceberg lettuce are average. quality is good to average, and we are seeing some mildew due to the rain. Expect shortages and high prices. ROMAINE Light supplies.

4 ICEBERG LETTUCE Supplies of iceberg lettuce are average. quality is good to average, and we are seeing some mildew due to the rain. Expect shortages and high prices. ROMAINE Light supplies. Quality is hit or miss with epidermal peeling. ROMAINE HEARTS Supplies are light. We are seeing twisting with average quality, and peeling. Prices are rising. EASTERN & WESTERN VEGETABLES GREEN & RED BELL PEPPERS More supplies are coming in from central Mexico (Sinaloa district) on green bell peppers. Prices have eased in the west however, we are still seeing a shortage in supply. Availability remains tight in Florida due to rain that occurred on Wednesday of this week. Red bells from Mexico are plentiful in supply. CUCUMBERS Cucumbers are in good supply from Nogales with favorable prices. Import volume on cucumbers from central America is steady and their quality is variable. ENGLISH CUCUMBERS (EURO) Supplies have increased in Nogales and prices will continue to ease. GREEN BEANS Availability has improved in Florida. Beans are in tight supply in Nogales where prices are trending up. ZUCCHINI & YELLOW SQUASH Production is on the decline in the west as the season winds down in central Mexico (Sinaloa). Prices are moving sharply higher for zucchini and yellow squash. Shippers in Nogales anticipate improved availability by mid-march, when new crops will become available from northern Mexico (Sonora). Prices are firm in Florida. Quality is variable in the east and west. ACORN, BUTTERNUT & SPAGHETTI SQUASH Squashes are readily available and market trends point to supply exceeding demand. There is ample volume of dark green zucchinis in Florida and Georgia, and a really nice yellow squash crop for this time of year as well. With the pressure from the white flies that plagued Georgia s early fall crop way down, the yellow squash volume is increasing and the quality is much more consistent. Georgia is starting on its last new fields this week, with Florida ramping up by the end of the month. MANGOES Supply and quality are expected to be in short supply. Peru has finished and Nicaragua is starting next week with very low volume. Mexico is being delayed as well. MELONS Above normal temperatures throughout the Northern Region have increased demand during the holiday week. Quality has been very consistent with better color starting to appear on the melons as the days get longer in the growing areas. We will start to see the spring melon crop by the week of 3/6 and all indicators say it should be a strong spring cycle in regards to quality. Cantaloupe: The market remains steady and should remain so as we finish the month. A little more volume is expected to continue hitting the market. Honeydew: Honeydew production has been peaking on 6/8s over the past week. Watch for 5s to shorten up until the new growing area of Guatemala begins in early March. Quality has been good with brix levels in the 10-12% range. WATERMELONS The seedless supply has increased over the last week as new areas in Honduras kick into heavier production. Watermelons should remain fairly steady through the month of March from offshore.

5 HERBS Quality on all the other herbs is very steady. We are having no issues with the cold temperatures around the country. Please keep us informed if there are any changes that we need to be made aware of. SAVORY: This is the only herb that is short. Remove last sentence CILANTRO: EXTREME MARKET - Supply is very light. Quality is variable, there is still yellowing with some decay. Prices are high and we are seeing shortages. HERBS HERB SUPPLIES QUALITY COUNTRY OF ORIGIN Arugula Good Good USA Basil Good Good USA/MEXICO Opal Basil Good Good USA/MEXICO Thai Basil Good Good USA/MEXICO Bay Leaves Good Good COLUMBIA Chervil Good Good USA Chives Good Good USA/MEXICO Cilantro Good Good USA Dill Good Good USA/MEXICO Episode Good Good MEXICO Lemongrass Good Good USA Marjoram Steady Good USA Mint Good Good USA Oregano Good Good USA Italian Parsley Good Good USA Rosemary Limited Good USA Sage Good Good USA/MEXICO Savory Good Good USA Sorrel Good Good USA Tarragon Good Good MEXICO Thyme Good Good USA Lemon Thyme Good Good USA Lavender Good Good USA Lime Leaves Good Good USA Hora Santa Good Good USA ARTICHOKES We are seeing very high prices and very short supply. Quality is good.

ARUGULA Supplies of both baby and wild arugula are light due to mildew. ASPARAGUS Jumbos are still tight and prices are still escalated due to the end of the season.

6 ARUGULA Supplies of both baby and wild arugula are light due to mildew. ASPARAGUS Jumbos are still tight and prices are still escalated due to the end of the season. We expect this to improve next week. There is currently a widespread problem in Caborca, Mexico that is resulting in delayed harvest productivity in fields ranging from 50 55% BELOW the levels forecast for this time of year. Current weather is excellent and growers are trying to figure out WHAT factors are causing the delayed initiation of normal productivity and harvest levels. Growers are unable to provide volume forecasts to cover pre-planned promotional (ad) commitments. There is so little volume crossing outside of prior commitments that the USDA has almost no open market volume on which to report pricing. There is a lot of activity with importers SEARCHING for volume to cover commitments. BOK CHOY Quality is good and we are seeing some higher quotes on WGA cartons. BROCCOLI Broccoli is in short supply. We expect this market to get tighter as we move into next week, as a result of warmer than usual weather patterns plus the amount of rain that has fallen. We are seeing a gap in harvest schedules and supplies. BRUSSEL SPROUTS The market and supplies are good this week. Quality is good. CARROTS Georgia carrots have arrived. Carrots have improved. CAULIFLOWER EXTREME MARKET Due to weather, we are seeing shortages and very high prices. Quality is average. Please expect price increases and short supply. CELERY QUALITY ISSUES and shortage in supply. We continue to experience rain events throughout California, with February historically being our rain month. In Oxnard, these constant rains have caused the celery to develop many defects in the acres currently being harvested. The outer petioles continue to get water logged (becoming translucent), and although we try to strip these petioles from the stalks while harvesting, this is not always 100 percent effective. More recently, we are experiencing a level of pith much higher than we were three to four weeks ago. Pith at high levels can be a major defect as the inside of the celery will tend to break down quicker and turn into decay. It becomes very apparent at the ends of the celery where the celery has been cut. Even the use of our waterjet cutting technology cannot minimize the effects of high amounts of pith we are experiencing. Some of the other overall quality issues that celery is experiencing under these constant rain conditions are listed below: 1. Outer petioles Water logged (translucency) 2. Light color/pale 3. Mud inside petioles. 4. Reduce shelf life (17 days max) 5. Brown ends. It is very important that our customers make every attempt to order the minimum amount of product necessary to fill orders and avoid any excess inventory. With reduced shelf life and the potential higher level of pith than usual this time of year, this is not a good time to stock up for promotions or introduce this product for the first time. We will update this information as we see any substantial shifts in quality.

CORN Florida sweet corn has seen a spike in pricing this week. There has been less availability than in previous weeks due to planting gaps and the cooler weather hindering maturity.

In the past week or two, we have observed a slight relief in demand. This is fairly normal following the New Year.

7 CORN Florida sweet corn has seen a spike in pricing this week. There has been less availability than in previous weeks due to planting gaps and the cooler weather hindering maturity. FENNEL Supplies for the week will be light. GARLIC: EXTREME MARKET - We saw another increase in price. The supply of domestic garlic remains tight. Pricing on domestic peeled 4x5s is still high. In the past week or two, we have observed a slight relief in demand. This is fairly normal following the New Year. In regards to Chinese garlic, there is an increase in supply especially on the East Coast. During this time of year, it is normal for China to export all pounds that were not placed into cold storage for the year. A percentage of the loads received in the US this past month are because of this, the garlic was not put into cold storage and must be sold in late November/December to avoid expiration. A percentage of Chinese peeled lbs. received in the last month are challenged (especially on the East Coast). Issues include excess translucency, pink and yellow aging/stress marks, mold, etc. With the additional supply compounded with the quality issues, the price of Chinese garlic has decreased in the past month. This week we are seeing it rise again due to the Chinese supply decreasing. As we move into the next three months, we expect the Chinese supply to continue to decrease which will lead the market to return to abnormal highs. Some Chinese shippers have recently received higher duty rates from US Customs. There are indications that these companies will not be exporting garlic to the US for the foreseeable future. GINGER Chinese ginger is in good supply. It is being offered at a substantial discount compared to ginger from Brazil. GREEN CABBAGE Green cabbage is in good supply and should be steady this week. Quality is good. GREEN ONIONS The green onion supply for the industry is getting better. We are seeing prices come down. KALE (GREEN) Demand is steady and quality is average. We are seeing some mildew. MACHE Adequate availability. NAPA supplies are good and quality is excellent. PARSLEY (CURLY, ITALIAN) Prices are normal and quality is average. RADISHES Quality is good and supply is plentiful. RED CABBAGE Quality and sizing have been great, with good color. Overall, the market is strong. SNOW & SUGAR SNAP PEAS Snow and sugar snap peas are in high demand with good quality.

BABY SPINACH Baby and clipped spinach supplies are light. Quality is fair to good, with good prices. There are some reports of mildew. BUNCHED SPINACH Supply is average, quality is only fair.

ONIONS Pricing has remained sluggish as Mexican supplies have continued to increase volume on all three colors.

Large size onions (colossal and super colossal) will need to continue to be sourced in the northwest. Quality remains strong in the northwest.

" It will probably be another few weeks before we see demand pick up for suppliers. You should be able to make good deals on consumer packs along with the smaller cartons in Idaho.

Grower's cannot continue to operate at below production cost's, it's just not sustainable for them. No issues to report on the transportation side.

8 BABY SPINACH Baby and clipped spinach supplies are light. Quality is fair to good, with good prices. There are some reports of mildew. BUNCHED SPINACH Supply is average, quality is only fair. We are still seeing some mildew in this product. SPRING MIX There is plenty of product with quality being average, but it has improved. ONIONS Pricing has remained sluggish as Mexican supplies have continued to increase volume on all three colors. The northwest is back to normal shipping and supplies are plentiful for the amount of season they have remaining. The size profile on the Mexican product is heavier on mediums and jumbos. Large size onions (colossal and super colossal) will need to continue to be sourced in the northwest. Quality remains strong in the northwest. POTATOES (IDAHO) Demand on consumers is very light, 40's thru 70's fair and 80's thru 100's light also. We cannot seem to get potatoes to grab hold and get demand back to "normal." It will probably be another few weeks before we see demand pick up for suppliers. You should be able to make good deals on consumer packs along with the smaller cartons in Idaho. Growers are in the early stages of trying to figure out their plans on upcoming plantings. The smart move at this time would be to see a push to decrease acreage in Idaho. Grower's cannot continue to operate at below production cost's, it's just not sustainable for them. No issues to report on the transportation side. TOMATOES East: Rounds Supplies in the east remain good despite the recent weather events. FOB prices are mostly unchanged this week with excellent quality being reported. Roma Harvest forecasts are mostly unchanged and quality is good. Pricing will be mostly unchanged this week. Grapes Supplies are good and quality is excellent. FOB prices remain unchanged this week. Quality remains very nice. Cherries Supplies are steady and quality remains good. FOB prices are remaining mostly unchanged. West/Mexico: Rounds Vine-ripe production is good through Nogales and McAllen, still light crossings through Otay. FOB prices are mostly unchanged this week. Overall quality is very nice on all sizes throughout Nogales, McAllen and Otay. Romas Supplies are good through Nogales and McAllen with great quality expected over the next 7 to 14 days. Grapes Good supplies are crossing through Nogales and quality remains excellent. Cherries Supplies are good, but the quality is off a bit this week. We expect to see a tick up in the prices as demand is driving more pull out of the East. WASHINGTON APPLES, PEARS & TREE FRUIT Apples: Demand and movement is steady with supplies readily available in most sizes and grades with the exception of golds and granny s. Supply remains tight on 100s and smaller on all grades except premium. 125s and smaller sizes in all varieties will continue to be tight all season. Pears: Demand and movement are steady. Most supplies are now coming out of California. Prices remain high on D Anjous, 100s and smaller whereas Bartletts have a much better value.

Weekly Market Review

Weekly Market Review March 2, 207 Overview The previous month s adversely unstable weather conditions in the Yuma growing region are still causing quality problems, lower overall weights and yields. The