Heatwave hits California lemons, sending prices soaring

• A heatwave in Southern California's major lemon growing region this month caused a loss of lemons and squeeze in supplies.
• The decline in supplies has driven up wholesale prices about 40 percent or more in some markets.
• Some are predicting the supply crunch could continue into September and October.

Pgiam | iStock | Getty Images

Fresh fruit grows on the orchard grove in California, USA

A heatwave in Southern California's major lemon growing region this month caused a loss of lemons and a squeeze in supplies, which has driven up wholesale prices about 40 percent or more in some markets.

"This demand exceeds supply situation will last until September/October at least." said Joel Nelsen, president of the California Citrus Mutual, a citrus producers trade group.

Terminal prices of fresh lemons in Los Angeles have risen about 40 percent or more since June 1, according to U.S. Department of Agriculture data. The price for cartons of lemons (sizes 95-115) at wholesale was $36 to $39 on June 1 and as of last Friday was $52 to $55.

"They're shooting up pretty high right now," a Los Angeles-area produce market specialist who didn't want to be identified told CNBC on Monday. "I heard it's like 70 bucks on the street now."

Ventura County, the leading region in the state for lemon production, suffered from record-breaking temperatures in early July at the tail end of is harvest season. Temperatures in portions of the county reached a high as 114 degrees on July 6 and hit the century mark again the next day in some growing areas.

Meantime, Ventura County Farm Bureau CEO John Krist told CNBC avocado trees also were impacted by the recent heatwave. He said small fruit fell off the trees for next year's crop. The region's avocado crop is usually harvested in February or March.

Weather forecasters are predicting temperatures will once climb again this week in parts of Ventura County, including Fillmore where highs could reach 104 on Tuesday and 107 on Wednesday. The same region suffered scorched crops — both lemons and avocados — back in December due to the massive Thomas fire.

The result of the early July heatwave was more fruit than normal falling to the ground, Nelsen said. He added that the supply situation is compounded by a shift in the lemon market from processed products to the majority of the crop now being consumed fresh.

"After planting a tree you wait four years to get a decent harvest," he said "We simply haven’t caught up. This is exacerbated by the fact that offshore supplies from Mexico, Chile and Argentina have not materialized as anticipated."

Sysco's FreshPoint, a major produce distributor, suggested in a tweet last week that customers should switch to limes. "A series of unusual weather events has devastated the domestic #lemon crop," FreshPoint tweeted. "Lemons that are available will be poor quality, including excessive skin scarring and off sizes. We encourage substituting #limes when possible."

https://twitter.com/FreshPointInc/status/1019310386414342145

A Sysco spokesperson declined comment.