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California grows more tomatoes for commerical food production than anywhere in the world but the companies that rely on them to make popular sauces like spaghetti sauce and salsa may not be able to get enough to keep up production.
Mike Montna, the head of the California Tomato Growers Association, told Bloomberg “We desperately need rain. We are getting to a point where we don’t have inventory left to keep fulfilling the market demand.”
The worst drought in 1,200 years has forced the state of California to restrict groundwater use, which means growers have had to cut way back on crops. Water issues combined with the rising costs of labor, fuel and fertilizer are resulting in a much smaller yeild, grown at a much higher price.
One Fresno County grower told Bloomberg that it costs around $4,800 an acre to grow and harvest a crop of tomatoes, versus $2,800 ten years ago. Most of these increases have been over the last two years.
High temperatures are also to blame as excessive heat produces smaller tomatoes. Fewer acres of crops with smaller yield per acre means very limited supply.
“There are simply not enough acres of processing tomatoes being planted this year to ensure that everybody gets their full supply,” said R. Greg Pruett, sales and energy manager for Ingomar Packing Co., one of the world's biggest tomato processors. Ingomar, which sells to come of the largest food brands in the US, says the price of tomato paste is up almost 80% from a year ago.
Market research firm IRI, says that as of mid-July consumers are paying 17% more for tomato sauce and 23% more for ketchup than they were in July of 2021.