Organic Sales in COVID-19 Era

It has long been an organic produce industry axiom that its most loyal consumers are more inclined to be environmentally conscience, and thus plastic packaging is not a good look. That viewpoint has apparently succumbed to fears over the new coronavirus, COVID-19.

“The only thing not selling is loose salad greens,” said Robert Lichtenberg, director of purchasing for Earl’s Organic Produce, San Francisco, CA. He opined that people must be afraid of the coronavirus and are not interested in buying loose items that might have been handled by unknown consumer hands. In contrast, bagged organic salads and value-added packages of other organic items are flying off the shelves.

He said Earl’s, which is an exclusively organic wholesaler, is doing twice the normal sales on a daily basis. “It’s like Thanksgiving every day,” he said referring to the amount of produce sales that occur during that time of the year.

Earl’s has a robust business selling to retailers in the Bay Area and throughout the country. The terminal market operator does not directly sell to restaurants, but it does sell to other market wholesalers who service that industry. San Francisco closed in-house dining in its restaurants earlier this week and Lichtenberg said that is reflected in the lack of sales to those wholesalers focusing on that business.

But sales to retailers has more than made up for it. For the past couple of weeks, the company has been able to fill its coolers but this week, he said “the supply chain is starting to show wear and tear. It is difficult to keep up with demand.” 

He reported that this is a normal transition period for many organic crops, so supplies are typically in shorter supply. Lichtenberg said the vegetable transition from the desert to the coast is underway. “The Coachella Valley is just about finished with the harvest starting to move up the coast.”

He added that the organic citrus production in California’s San Joaquin Valley is winding down, but the organic summer fruit program won’t start until late April at the earliest. And he said organic onions and potatoes will also be in very short supply as the storage volume is running out and the new season fresh crops have not yet started.

Drive down to Southern California and the report is the same from Heath & Lejuene, Inc., Los Angeles, another specialist in the organic produce sector. “If you walk into our coolers, the most obvious sight is the empty walls,” said David Weinstein, a buyer and seller for the company. “We can’t keep anything in stock. At the stores, people are buying everything in sight. I don’t know what they are doing once they fill their refrigerators, but they are still buying.”

He opined that people are acting a little bit crazy but the produce industry is doing an excellent job reacting to the situation. “The produce industry has proven it has a nimble and flexible, redundant supply chain,” he said. “Even when there are crazy people out there testing our supply chain, we are keeping the stores stocked and at least the produce department still has product. And we are doing this without gouging. The prices are where they should be. There are seasonally appropriate increases. At least in the United States, our supply chain is working.”

He agreed that only the sales of bulk leafy items are lagging. “People are buying everything in packages,” he said, adding that tomatoes, zucchini, broccoli and avocados are also experiencing demand exceeds supply in the organic category.

But the cavalry is on the way. Heidi Devine Garcia, purchasing manager for Double D Farms Organics, which is headquartered in Fresno, CA, said they will start harvesting their San Joaquin Valley organic production by the end of March. The company farms several different crops including broccoli, sweet corn, onions, celery and garlic. She said the growing weather has been very good and they will have strong supplies from California and their other production areas moving forward. Besides California, Double D farms in Texas and a couple of districts in Mexico.

Gahl Crane, sales and marketing director of Eco Farms Avocado Inc., Temeucla, CA, said organic avocado production will increase as California approaches its heavy shipping periods from April through July. Speaking on Friday, March 13, specifically of the impact from the new coronavirus, he said: “We’ve seen some increase in demand at the retail level, which should offset any losses at foodservice. Overall food is food and people have to eat.  We have not seen and are not anticipating a drop in demand…at least not for avocados, which is the only crop I can talk about.”