Smaller Pear Crop To Boost Fresh Pear Prices
The 2012 U.S. pear crop was forecast by NASS in August at 1.76 billion pounds, 8 percent smaller than a year ago. Replenishing energy from last year’s large crop and unfavorable weather this growing season was behind this decline. Yields for D’Anjou and Bosc varieties in Washington, for instance, were negatively affected by poor weather during pollination while some producers also reported reduced production due to late-spring hail, wind damage, and fire blight problems.

Among the top three producing States, production is forecast down 8 percent in Washington and down 13 percent in California, but up 3 percent in Oregon. While most of the Nation’s pear-growing States are expecting production to decline this year, Oregon is expecting Bartlett tonnage to increase 23 percent. Tonnage for Oregon’s non-Bartlett varieties is expected to decline only slightly, leaving a net gain from 2011. In Washington and California, the Bartlett and non-Bartlett crops are both expected to be smaller. The combined forecast for the 3-State Bartlett pear crop was set at 816 million pounds, down 5 percent from a year ago, and the 3-State non-Bartlett crop at 930 million pounds, down 8 percent. Among minor producing States, sharply reduced production in New York due to spring freezes and the hot and dry summer also contributed to the smaller overall non-Bartlett crop. Although the NASS production estimate for Michigan will not be available until January 2013, knowing that the State’s pear crop also suffered the same adverse weather conditions this growing season point to marked declines in production.

With the fresh-market share of total utilized production remaining at over 60 percent in recent years, ERS projects U.S. fresh pear production at 1.15 billion pounds for the 2012/13 marketing season (July-June), down 11 percent from 2011/12 but fairly steady from the previous 5-year average. The projected fresh production is in line with NASS’s forecast smaller non-Bartlett pear crop—the varieties that make up nearly 70 percent of all U.S. pears for fresh use. The forecast smaller Bartlett crop also bears influence as more than one-third of domestic Bartlett production, on average (based on 2009/10-2011/12 production), is destined for the fresh market. The projected reduced fresh-use production is expected to elevate domestic fresh pear prices in 2012/13, especially as competing U.S. fresh apples are also anticipated to be down.

Both reduced production and higher prices will likely translate to a decline in domestic fresh pear use and limit the prospects for continued strong exports in 2012/13. If U.S. fresh pear imports in 2012/13 increase by 20 percent from the 2011/12 volume, overall domestic supplies will still be down 8 percent from the last season’s bumper supplies, but consistent with the previous 5-year average. Should the export market continue to absorb about one-third of the season’s fresh domestic production as has been the case during the past several years, U.S. fresh pear exports could reach 360 million pounds in 2012/13, down 14 percent from the record volume in 2011/12.

Fresh pear volume imported in the United States in 2011/12 declined 20 percent from the previous season, with volume from most trade partners posting declines. These included significant declines from leading U.S. sources overseas—Argentina (down 25 percent) and Chile (down 21 percent). Aside from the big harvest in the United States in 2011/12, production declines and weather-related fruit quality issues dampened fresh pear exports from both leading sources, driving down U.S. imports last season. Meanwhile, abundant supplies and lower prices in the domestic market supported a strong export season for U.S. fresh pears in 2011/12. Exports reached record levels for volume (420 million pounds) and value ($191 million). Export volumes increased to most markets, including to top market—Mexico—where U.S. shipments took a 55-percent gain, aided in part by the elimination of the import tariff related to the U.S.-Mexico trucking dispute. Strong export gains were also achieved to many key markets in Asia and South and Central America, while shipment volumes were relatively unchanged to Canada, the second largest destination, and down to Russia, where exports have shown remarkable growth in recent years.

The Bartlett harvest in California had already started in the Sacramento Valley as of mid-July, ahead of last year’s delayed start. Harvesting in the Lake and Mendocino regions was expected to commence in late August. Despite the overall smaller domestic crop, AMS reports overall U.S. fresh pear shipment volume through late August running 15 percent above the same period last year, reflecting the earlier harvest in California. Over 95 percent of total season-to-date shipments were California pears. U.S. fresh pear grower prices in 2012/13 started out strong, with the July average price at $0.31 per pound (or $620 per ton), up from $0.28 in July 2010 and from the previous 5-year July average of $0.29. As overall shipments in 2012/13 overtook last season’s through late August, grower prices in August fell to an average $0.26 per pound (or $527 per ton), 8 percent below the August 2011 price, but still slightly higher than the 5-year average for the month.

Price movements were almost similar at the retail level so far this season. Based on AMS data, advertised retail prices for Bartlett pears in the United States in July 2012 averaged $1.50 per pound, compared with $1.21 per pound in July 2011. For the same period, retail advertised prices for D’Anjou pears rose from $1.10 per pound to $1.52 per pound. August retail prices for Bartlett pears, however, rose from $1.30 per pound the same time last year to $1.31.

In Oregon, the Bartlett pear harvest was underway as of early September and timing for peak harvest, in general, occurring about a week after and winter pears by months end. Though prices appear to be weakened seasonally with the height of harvest, effects of the overall smaller crop this year on prices will likely be more apparent in the coming months, with likely upward pressure to surpass 2011/12 price-levels. Both quality and sizing of California and Oregon pears were reported to be good which will also aid prices.

On the processing side, the 5-percent smaller Bartlett pear crop signal a decline in raw material pears in 2012/13, likely driving up this season’s grower prices for processing-use pears above 2011/12 price levels. Last season, processing-use production rose above the 2010/11 production which was the lowest tonnage reported over the past three decades. Grower prices for processing-use pears remained at historical highs, averaging $244 per ton for the 2011/12 season, slightly surpassing the previous 30-year record-high of $243 per ton in 2010/11.