Surplus drives down processing tomato prices, acreage

Freshly picked tomatoes fill a bin. The harvest of a diminished processing tomato crop is under way in California, as acreages are down because of a glut of tomatoes on the global market.

ARBUCKLE, Calif. — Processing tomato growers are stepping up their harvest of a crop whose acreage is diminished, not so much because of drought but because of global market conditions.

Tomato processors secured contracts for 13 million tons of tomatoes this season, down more than 9 percent from last year’s contracted production, as this year’s 262,000 acres of processing tomatoes is nearly 12 percent below 2015, according to the National Agricultural Statistics Service.

Growers and industry representatives say a surplus of tomatoes on the world market prompted processors to cut back on planned purchases. Global production this year is about 7.5 percent below last year, said Mike Montna, the California Tomato Growers Association’s president and chief executive officer.

“Planted acreage is down mainly because of market conditions,” said Arbuckle, Calif., grower Darrin Williams, a CTGA board member. “Processors were long in inventory going into this season, and there have been quite a few cutbacks on acreage on acreage because of that. We had a big world crop last year, and this year we’re down a couple million tons from last year.”

To be certain, drought continues to have an impact —å∑ particularly in the western San Joaquin Valley, where federal surface-water allocations were just 5 percent of requested supplies this year, Montna said.

“For them, the drought is as real as it’s been in the last three years,” he said. “It’s more insurance water, not farming water. It’s in case a pump goes out or a well goes down … It’s not enough to really farm tomatoes with.

“We’re seeing the impact … of multiple years of well water” on quality and yields, he said. “Obviously we’d like some fresh water to blend, but we don’t have that ability now with the allocation.”

Harvests of early tomatoes started in mid-July and are expected to ramp up in the coming weeks. Williams said he’s about 20 percent done with his harvest, and he’s so far seen good yields and quality.

So far, northern parts of the state are at or slightly above contracted levels, Southern California growers are at or slightly below their contracts and Central California is just getting started, he said. Disease pressure has caused troubles in some fields, he said.

“Everyone has a problem field this year, whereas last year was good across the board,” Williams said.

With leftover inventories of tomatoes in warehouses, prices to growers fell from $80 per ton last year to about $72.50 per ton in 2016, meaning growers will need some high yields to do more than break even, the California Farm Bureau Federation reported. At the same time, lesser yields could push prices back up, growers say.

Fresno County leads the state with 80,800 acres of processing tomatoes contracted in 2016, followed by Yolo, Kings, San Joaquin and Merced counties, according to NASS. The top five counties make up 73 percent of the state’s total contracted acres, the agency reported.

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