With Supplies Squeezed, Orange Prices Snowball

With the extent of freeze damage still uncertain, orange prices have soared at California grocery stores as the pre-Christmas cold snap wreaks havoc with supply and quality.

Meanwhile, retailers are scouring the world for other sources of fresh navel oranges, pursuing fruit in Mexico and faraway Morocco, Spain and Israel.

California produces 80% of the oranges, both navels and Valencias, eaten as fruit in the United States. Current estimates are that 70% of the crop was wiped out.

It thus appears clear that shoppers will find leaner-than-usual supplies for months to come.

Lucky Stores raised the price of navels Monday to 99 cents a pound, from 69 cents. Vons stores were charging $1.79 per pound and Ralphs, $1.69.

At a Whole Foods Market in West Los Angeles, conventionally grown large navel oranges were selling for $1.59 a pound, but the quality was poor, according to store team leader George Khoury. He said shoppers preferred the store’s offering of exceptionally sweet organically grown navels from Porterville, Calif., at 99 cents a pound.

Whole Foods and other grocers are posting signs in produce sections to explain to alarmed shoppers that Mother Nature is to blame for the skyrocketing prices.

Though widespread media coverage had shoppers braced for price increases, the reality of paying 99 cents to $1.99 a pound for navel oranges--contrasted with 3 or 4 pounds for a dollar before the freeze--has put a crimp in demand.

Many customers have switched to less expensive tangerines, Minneolas and other fruit. One San Diego distributor said banana sales have spiked.

California Citrus Mutual, an industry trade group in Exeter, said it has advised growers and shippers to hold off on harvesting until the industry can assess damage from December’s subfreezing weather.

For now, wholesale prices for large oranges remain as high as $30 per 37-pound carton, double to triple what they were before the big chill set in.

“We’re finding salvageable fruit,” said Shann Blue, director of grower services for the 800-member group.

“Fruit truly does have the ability to heal” on the tree, while maintaining quality, Blue added.

By holding off on picking, the group hopes that growers can avoid shipping fruit that appears fine but could deteriorate before it reaches market and thus disappoints shoppers.

As it happens, current weather conditions--cool nights and slowly warming days--are “perfect for recovery,” said Claire Peters, a spokeswoman for Sunkist Growers, a grower-owned citrus marketing co-op that has about 6,500 members in California and Arizona.

Peters said the Sherman Oaks-based co-op expects to know by the beginning of next week just how bad the damage has been for the navel crop.

Sunkist’s two juicing plants, in Tipton (Tulare County) and Ontario, are poised to go to 24-hour-a-day production should growers decide en masse to forgo the fresh market.

Peters said at least 50% of the navel crop is presumed lost. Other estimates range as high as 70%. Earlier, state agriculture officials put the loss at $591 million.

Nick Hill, a grower in Orange Cove, 30 miles east of Fresno, expects to start juicing some oranges in the next couple of days. Meanwhile, he shipped off his badly damaged lemon crop to a juicing facility, getting $40 a ton. That puts him $8 per ton in the hole on picking costs.

Getting the fruit off the trees before it rots should cut down on diseases, however.

“It’s not pretty,” said Hill, who grows citrus on 1,300 acres.

The Central Valley lemon crop was wiped out, but the region accounts for a relatively small portion of the state’s lemons, most of which are grown in Ventura County. So far, that area has been spared.

Hill acknowledged that growers might have scared away customers prematurely by broadcasting fears about the damage before it was fully evaluated.

“Demand has dropped drastically,” said David John, a buyer with General Produce Co., a wholesaler in Sacramento.

The reduced demand means that oranges are available, but retailers are selling out higher-priced supplies before ordering more.