Tomato processors remain optimistic
02/07/2014 4:35 PM
02/07/2014 4:45 PM
The price farmers get for tomatoes is going up, and that likely means the cost will be passed on to consumers.
Farmers will receive $83 per ton, up from $70.50 last year.
Tomato processors are projected to contract 13.5 million tons this year, according to the California Department of Food and Agriculture and California Agricultural Statistics. The agencies predict that if the total for 2014 is fulfilled by the end of the year, it will be a record harvest. No final numbers were available for the tonnage harvested in 2013.
The processed tomato crop brought in $52.7 million in 2012, according to a Merced County crop report, while fresh tomatoes accounted for $63 million in income.
The Processing Tomato Advisory Board reported a statewide tonnage of more than 12.6 million for the July through early November 2012 season.
Ron Dalforno, representative with Morning Star, the largest tomato processor in California, said the price increase is due mainly to the water shortage brought on by the drought. The company produces 40 percent of the tomato products in the United States.
Dalforno said Morning Star is going to be flexible with farmers and how they schedule plantings, because the water supply will be limited this year. “We still plan to process tomatoes for our customers, and do what we need to do to purchase those tomatoes,” Dalforno said. Even if it means changing the area from where tomatoes are purchased, he added.
Luis de Oliveira, president of Kagome USA, another Los Banos-area processor, said the company is doing its part to conserve water.
Kagome produces tomato paste and other tomato products, such as sauces and diced tomatoes.
Oliveira said since growers are making tough decisions on which crops to grow and how much of that crop to plant, due to water availability, it’s going to have an impact on their business as well.
“There’s no way we can absorb that kind of increase,” he said. “So we will (pass the) cost increase to customers. It’s going to create a tremendous impact.”
Ingomar Packing Co., which processes fresh tomatoes into tomato paste and diced tomatoes, is also feeling the effects of the drought.
“Drought has had some big impacts,” said Greg Pruett, president. “It’s required us to reallocate our sources to growers that have more secure water supplies.”
The three processor and Liberty Packing Co. employ nearly 1,600 people during the height of the tomato season.
Tomatoes have grow in popularity. Recent studies show that tomatoes are a rich source of lycopene, a fat-soluble compound whose absorption is boosted by heating. Lycopene is also an antioxidant; it works in the body to counter free radicals that can damage cells and their DNA.
Meanwhile, it was standing room only at the Los Banos Fairgrounds on Wednesday, where Central California Irrigation District officials held a public meeting to discuss the dire water situation.
Items on the agenda included updates on reservoir conditions, rainfall and snowpack. At the meeting, general manager Chris White explained the 2014 dry year forecast, stating that the U.S. Bureau of Reclamation informed “exchange contractors,” that due to the record dry rainfall the state is experiencing, CCID will only be able to deliver as low as 40 percent and as high as the 75 percent of critical year allocation, depending on the rainfall. The exchange contractors are Los Banos-area farmers irrigating about 200,000 acres on the San Joaquin Valley’s West Side.
However, the board of directors has set an allocation of 50 percent of the normal year water supply to its growers. According to CCID, the allocation will be re-checked by the district monthly, and weather permitting, the allocation should be increased.
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