Or does it need to be dry out?
Which fruit? Generally a bad idea, but your climate may allow it.
Apples & peaches
I’d guess yes for apples, no for peaches- don’t really know. It’s likely that the bags will accumulate and retain moisture anyway, is my logic.
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My reasoning is similar to that of @marknmt. Aithough I have not read any article if bagging can or cannot be done during rain.
My feeling is for stone fruit that can rot easily like peaches, it is best to bag the fruit when the fruit are dry. Once bagged esp. with a Clemson bag, the fruit likely will remain dry until ripe. With that, it reduce a chance of fruit rot.