California’s drought is squeezing tomato farmers as costs continue to rise



Central Valley of California
CNN

Take a summer trip on Interstate 5 through the heart of the Golden State and it’s almost impossible to miss the truckloads of tomatoes transported directly from harvest to production.

This year, however, fewer tomatoes were grown as rising interest rates, inflation and a crushing drought squeezed farmers who saw their margins cut and split. While the cost of growing tomatoes continues to rise, it ultimately affects consumers’ wallets as well.

Usually starting in July and running through October, California farmers are busy harvesting tomatoes: large machines gather the fruit and free it from most of the vines before quickly pouring it into the back of trucks. Those trucks immediately hit the road from the farm to the processing plants, where loads are tested, cleaned and processed 24 hours a day, all within hours of leaving the field.

“Ninety-five percent of the processed tomato products consumed in the United States come from here in the Central Valley of California,” said Mike Montna, president and CEO of the California Tomato Growers Association, at a farm where this season’s final award was being harvested. . “Particularly the tomatoes from the growers that I represent … they go into your ketchups, pizza sauces, store-bought sauces that you see in the supermarket.”

California tomato growers produced less than expected this season. In January, CTGA aimed to produce 12.2 million tons of tomatoes. In May, that number was reduced to 11.7 million tons and now, as the growing season is winding down, Montna said the actual number will be lower than that.

“Ultimately we’re going to end up around 10.5, 10.4 million tons,” Montna told CNN, estimating that it’s about 14 percent short of the annual forecast. “We are not getting the return we expected or historically we got seven to eight years ago. We are in a state of decline in yield and a lot of it is due to the weather and how intensive tomato growing is.”

For the fourth year in a row, CTGA production numbers were lower than they would have liked, Montna said, citing the lowest inventory the industry has ever seen, fueled by increased demand for their products during busy days. of the Covid-19 pandemic. In addition, Montna said inflation ate up most of the 24% increase in prices received by growers per ton of tomatoes this year compared to the previous year.

Farmer Aaron Barcellos and his family have been growing tomatoes for 25 years, but they reduced the number of hectares usually devoted to tomatoes from 2,000 to more than 500 hectares. Instead, those 2,000 acres stayed long this season. Montna said that every farmer in CTGA currently has some land fallow because there is not enough water for all the crops they would like to grow.

“It’s like owning a second home and trying to rent it out,” Barcellos said of his land plot. “If you don’t have tenants there, you still have all your fixed costs … but you’re not making any income.”

But water is king for farmers and without enough resources, something had to give.

Tomatoes are water and labor intensive to grow and require more water to wash before cooking.

“We started with lower acres because of the drought because of the water supply,” explains Barcellos, who is a partner in A-Bar AG Enterprises with his brother, son and nephew. “During the drought, our water triples and quadruples in price. I It costs you four times as much, and you’re still trying to put in a crop where you’re competing with the rest of the world.”

With droughts becoming more frequent in the West, Barcellos faces years when it doesn’t get water allocations because there isn’t enough water. The first time it faced a year without water allocation was 2014. This year, he said, “they had a zero allocation on our federal land.”

Barcellos comes from a farming family. He grew up in the Central Valley and has seen agriculture adapt to ever harsher conditions.

“We’re seeing hotter streaks in the summer, more extremes between cool and warm and I don’t know what an average year is like anymore,” he said, adding that yield declines are caused by tomato plants being disrupted by those temperatures. swings “A lot of that is due to climate change.”

During harvest, truckloads of tomatoes are taken directly from the farm to the plants, where they are tested, washed and processed within hours of picking.

But it’s not just water, which Barcellos called his “primary limiting resource.” Farmers also pay more for fuel and fertilizer, with these additional costs reflected in consumer prices. Growing a tomato crop five years ago would have cost about $3,500 per acre, Barcellos said. Today, it would be worth more than $5,000.

“No farmer in California is making money with tomatoes this year, even with record prices,” Barcellos said. “All these inflationary prices that consumers are seeing at the store and rising food prices? Well, we are seeing that the same thing is happening to us at the farm level.”

In fact, consumers feel that price increases are hitting their wallets. According to the US Department of Agriculture, prices of processed fruits and vegetables are expected to increase between 10 and 11 percent in 2022 compared to 2021.

Barcellos said that many farmers are moving away from tomatoes because the crop is difficult, labor-intensive, and while price pressures are rising, the risk-reward ratio is not in favor of farmers, especially some. the other growing crops earn more money and are much more labor intensive.

“We have this sentimental attachment to growing the tomato because it’s one of the first crops we ever grew,” Barcellos said, adding that he sees the tomato as a great product. “There is a feeling of home. There is a sense of community and family in that.”

For 25 years, Aaron Barcellos and his family have been growing tomatoes.  But with inflation and persistent drought, tomatoes may not be one of the crops to grow next year.

Currently, his family operation is considering whether it is time to crush the tomato in its product line.

“Right now, we don’t have any acres planned for tomatoes next year,” Barcellos said, adding, “Unless the tomato prices in the field get to a level where we think we can make money, we will. Go do something else with those open acres.”

As this season draws to a close, plans are already being made for the new crop year, as farmers must soon decide whether they intend to grow tomatoes again, as the global economic outlook remains as unclear as the weather.

“In some cases we start sowing tomato seeds at the end of December,” explained Montna. “So we have to start throwing the seed and committing to planting tomatoes before we know the full picture of rain.”

Beyond short-term needs, many California growers are calling on the state to find more ways to make the most of the rain.

“We need more storage,” Montna said. “Let’s catch more when it’s wetter so we can get through the much drier times.”

According to Barcellos, the problem is even broader, as he sees it becoming more difficult for farmers to be cost competitive with products from other countries.

“The more we start to rely on foods that aren’t grown in the U.S., the more concerned I think we have to be,” Barcellos said, adding that those sources may not always be available for the American market or to cultivate those products. the same standards that consumers usually find in grocery stores. “Until we start accepting those choices at the grocery store … and until we start buying what it costs us to produce in California, we’re going to drive companies out of California, and it’s not just farmers.”