Despite the start of the season, watermelon sales in one area have seen a noticeable drop in price. The market is currently experiencing an oversupply problem with low demand, which is very different from the situation from the previous year, when unfavourable weather circumstances led to a considerable decrease in the amount produced. From two to three kilograms per square metre the previous year, the average yield per square metre has increased significantly, reaching nine kilos.
Towards the end of last week, growers encountered an exceptional situation for this time of year: offers of just 10 to 20 cents per kg. Contrary to the usual tendency, it’s interesting to note that the demand for watermelons on the local market seems to be higher than on the export market. The majority of the watermelon supply is typically exported, although both domestic and foreign sales are currently declining. Most of the available stock—about 90% of it—is earmarked for export, but consumer tastes are greatly impacted by the weather. Therefore, the lack of sunlight causes a decrease in watermelon sales.
It is clear that the pricing at the producer and retail levels differ significantly. It is still questionable who will ultimately be responsible for paying some expenditures, such as packaging and logistics. Additionally, information is frequently delayed for supermarkets that receive the watermelon supply for export. Due to the fact that grocery chains organize their promotions months in advance, this time gap, which lasts a few weeks, presents difficulties.
The pricing at the origin and the retail market consequently frequently diverges. It’s difficult to put immediate changes into action, claims a source. Although weekly pricing agreements are set, it often takes one to two weeks for these changes to be reflected in sales prices. This delay is a result of the supply chain’s complexity, forcing farmers and sellers to negotiate a volatile and challenging market.
17 May 2023
