Market Outlook

Flooding, Hurricanes, and Drought Disrupt Otherwise Strong Vegetable and Dry Pulse Markets

Major weather events have caused varying impacts across many vegetable and pulse regions and crops. However, overall, crops have responded with stronger production over previous periods despite the challenging conditions. During the first 6 months of 2017, prices at the point-of-first-sale (farm price) for most commercial freshmarket vegetables were above previous-year levels, despite increased shipments. Overall, 2017 shipment volume through August was up 2 percent from the 2016 year-to-date level and at parity with shipments from the same time in 2015.

Despite a national increase in shipments and although winter rains gave California some relief from the prolonged drought, State fresh vegetable shipments were slightly down from previous years. Flooding early in the season created a temporary delay in harvest, which resulted in a price spike during the spring. Additionally, major hurricanes that acutely affected Texas and Florida may cause further delays in harvest that have not been fully realized to date.

At 35.3 million hundredweight (cwt), the 2017 dry bean harvest is record-high and 6.6 million cwt above the 2016 production estimate. Lentil planted area surged to a new record of 1.109 million acres in 2017, but dry conditions sapped yields and resulted in a 41-percent decline in production. The dry pea harvest was hit by both lower planted and harvested area and reduced yields, which combined to decrease dry pea production by 45 percent from 2016.

U.S. fall-season potato growers planted 907,800 acres in 2017, down for the second consecutive year. Harvested area also declined 1 percent. Declines in the 2014/15 and 2015/16 marketing year potato prices are likely responsible for the area decrease.

International Trade

Exports of U.S. vegetables increase moderately while pulses exports see rapid growth

The U.S. vegetables trade deficit widened in 2016 as a strong dollar and weak global demand continued to slow export growth. In 2016, fresh vegetable exports rose 6 percent to 4.2 billion pounds over the previous year and processing vegetable exports fell 1 percent to 17.1 billion pounds.

During the same period, strong demand for pulses drove exports up by nearly 21 percent.  Expansion in dry pea, lentil, and chickpea cultivation has been spurred by strong demand from export markets, notably, from an increasingly important trading partner, India. In 2015 and 2016, the monsoon season in India brought below-average precipitation and resulted in a relatively small pulse crop harvest. To supplement domestic production, the Indian Government and private traders expanded imports of many sustenance goods, including wheat and pulses such as lentils. Traditional suppliers Canada and Australia also benefited from growth in trade with India; however, the United States emerged as an important secondary provider of largely high-quality green and yellow lentils.

Domestic vegetable availability continues to rise driven by imports

Despite the modest decrease in U.S. domestic vegetable production, domestic availability increased slightly in 2016 due to the robust expansion of imports and only a slight increase in exports. According to preliminary data, per capita availability (previously called disappearance, or use) of vegetables and pulses in the United States totaled 383 pounds in 2016, up 2 percent from 2015. Canning vegetables, particularly tomato products, accounted for the majority of the increase in domestic vegetable availability between 2015 and 2016.  Imports accounted for 31 percent of fresh vegetables and 22 percent of processed vegetables available for consumption in 2016.

The availability data measure supplies of commodities moving through production and trade channels for domestic use. The data do not directly measure food intake, but they serve as useful indicators for understanding trends over time. In addition, the data are not adjusted for spoilage and other losses. Thus, when used in this manner, the data provide an upper-bound on the amount of food available for domestic use and consumption.

Growth in domestic demand, especially for chickpea-containing products such as hummus, has helped to support prices and encourage expanded proportional and absolute growth in production. Increased domestic supplies have lifted the per capita availability forecast for chickpeas for the last 2 years. 

Last updated: Wednesday, May 08, 2019

For more information contact: Travis Minor