Aug 12, 2021
Tomatoes are harvested in San Joaquin Valley, Calif., by Ingomar Packing Company. (John Brecher for The Washington Post)
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CONTENT SOURCED FROM THE WASHINGTON POST
Written By: Laura Reiley
Tomato growers are feeling the squeeze: Low inventory, pandemic hoarding and now extreme drought.
Tomato sauce is feeling the squeeze and ketchup can’t catch up.
California grows more than 90 percent of Americans’ canned tomatoes and a third of the world’s. Ongoing drought in the state has hurt the planting and harvesting of many summer crops, but water-hungry “processing tomatoes” are caught up in a particularly treacherous swirl (a “tormado”?) of problems that experts say will spur prices to surge far more than they already have.
The drought threatens to imperil some of Americans’ favorite ingredients — pizza sauce, marinara, tomato paste, stewed tomatoes and ketchup all hang in the balance. And this comes not long after a bizarre, and completely unrelated, shortage of pizza sauce and individual ketchup packets during the height of the food-delivery-crazed pandemic.
This also comes on top of already steep increases in the price of fruits and vegetables, which have been rising since the coronavirus pandemic was declared last year.
For tomatoes, higher prices could start taking hold soon if not already, said Wells Fargo’s chief agricultural economist Michael Swanson.
“If you’re a producer or a canner and see these problems coming, why would you not raise prices now in anticipation?” he said, adding that consumers don’t see the price tag for a lot of the processed tomatoes consumed away from home. “It’s embedded in the menu board — but it is one more reason prices at Chipotle and Pizza Hut will go up.”
In a normal year, Aaron Barcellos, a farmer in Firebaugh, Calif., grows 2,200 acres of processing tomatoes. This year he’s decided to drop to 900 acres on his farm, which is on the border of Merced and Fresno counties. He’s left the remaining acres unplanted, choosing to focus all of his precious water on almonds, pistachios and olives grown on trellises — crops that command higher prices and represent already-significant sunken costs.
“We get eight inches of rain in a normal year. Last year we got 4½ inches,” he said. “We got zero percent of our water allocation, which forced us to buy a lot of expensive water, and it doesn’t make sense to put it on tomatoes.”
He said many growers have made the decision to use their limited water on permanent crops — trees and things like grape vines — choosing to forgo planting annuals like tomatoes, onions and garlic, or even letting crops already planted wither in the desert-like conditions.
This year’s shortage of processing tomatoes has been a long time in the making. Farmers already had been planting fewer tomatoes. From 2015 to 2019, fewer countries were importing American tomatoes, partly because the dollar was strong, which made U.S. canned tomato products more expensive. This created an oversupply of California tomatoes, said Rob Neenan, chief executive of the California League of Food Producers.
Processors cut back their orders and farmers grew fewer acres. At the same time, partly because of a trade war, a global shortage of steel sheets used to make cans for food production caused can prices to soar. Major processing plants in Williams, Lemoore and Stockton, Calif., closed, citing higher production expenses, leaving fewer places for growers to sell. Inventory at the beginning of 2020 was low and supplies had tightened up worldwide.
And then the pandemic hit. Cue the tomato hoarding.
Frank Muller, a multigenerational tomato grower and president of M Three Ranches in Woodland, Calif., in Yolo County, euphemistically describes the market last year as “disrupted.”
Early in the pandemic, gallon cans of tomatoes sat unwanted on restaurant distributor shelves, hurting those who sold to the restaurant industry and other food-service sectors — this included caterers, event arenas and corporate cafeterias, all shuttered in the spring of 2020. Meanwhile, retail sales at grocery stores — from 5-ounce cans of paste to 28-ounce cans of diced — went nuts.
“If you were just selling to food service, they didn’t want all those tomatoes last year when restaurants closed. But if you were in retail, you were in hog heaven,” he said, going on to describe the huge uptick in pandemic pizza delivery, which used up all those gallon cans, followed by a ketchup shortage when curbside pickups and food delivery services grabbed all those little packets.
On top of the chaos of the supply problem, there’s still the threat of the coronavirus: Thousands of farmworkers throughout California have gotten sick on the job. Outbreaks still occur, despite robust vaccination pushes.
