The approach of spring means more Mexican melons, mangoes and other commodities crossing the border at Nogales, Ariz.
But as February began, tomatoes were still the talk of the town. If they could hear what’s being said, they’d turn redder than usual.
“There’s a glut of tomatoes on the market,” said Steve Yubeta, vice president of sales for Nogales-based Farmer’s Best International.
Between Florida and Mexico production, an oversupply on all varieties sent prices tumbling in January.
“The minimum price on tomatoes is around 22 cents a pound according to the Department of Commerce suspension agreement (with Mexico), and a substantial portion of fruit is being sold at that right now,” Jim Cathey, general manager of Nogales-based Del Campo Supreme, said in late January.
That’s about $5.50 for a 25-pound box.
In Florida, Arizona and Texas some shippers pointed fingers at their counterparts in the other regions. But blame was being laid — or relief sought — across the supply chain.
“It’s not just the fact there’s all this volume,” Cathey said.
“It’s the reluctance to promote. A lot of major retailers are just laying back, content to make substantial margins. They had the hammer out after the freeze last year expecting to be covered. Now when people are looking for some reciprocity, it’s not there in the same spirit as when we were covering the shortages.”
Chuck Ciruli III, chief executive officer of Nogales-based Ciruli Bros. LLC, said his company was finding some relief in urban markets.
“A lot of the Hispanic chains are getting aggressive and selling tomatoes at good prices,” he said.
“You see that in places like Los Angeles and Chicago. As bigger retailers see what they’re able to do with volume, we’re hoping they’ll follow.”
“The shippers have to take responsibility for not setting up ads before,” Cathey said.
“We can call a Hispanic chain and have an ad for the weekend. Major retailers want to know what you can do for them in March. If I’m still in business, I’ll see if we can help you out.”
Some cool temperatures early in the Mexico growing season benefited tomato plants, Ciruli said, but forced production into a tighter time frame.
“Once it got warm, we had more stuff,” Ciruli said. “We got the amount we planned, but in a shorter time span.”
Ciruli, Yubeta and Cathey all expect the glut to ease by March 1 or sooner.