Bloomberg came out with an article and for the tomato industry the news is not so bad. Due to the high demand for processing tomatoes, better known as the kind that they use in sauces, soups and cans, farmers produced 16% more tomatoes this year than last year, a record crop.
The price point on tomatoes is high, so farmers focused their limited water supplies on that specific crop for companies such as Campbell who rely on those tomatoes for their business. When it came to allocation of water, farmers had a decision to make and tomatoes made sense because it gave them income in a place where they would take a significant loss.
The overall news is things are only getting worse. Look for important California crops like tomatoes to not be able to meet demand in the not too distant future. The lack of water will ultimately only raise food prices and make processed food even more attractive to those who can’t afford the former. Let’s hope that they get some rain out there so our agriculture system does not have to take a huge hit in a huge farming state.
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