The Big Picture:

 v      Agricultural Producers are seeing significantly higher costs of inputs

o        Labor – green chile is hand harvested, the grower is very concerned about the supply and quality of the labor pool for harvesting the chile crop

o        Energy – a major use of energy is in pumping water, all energy costs are up significantly on the farm creating an environment in which the grower needs and is demanding higher pricing

o        Fertilizer – fertilizer costs are tied to natural gas prices and are up to double what they were a year ago

 v      Alternative crops – prices are up considerably, growers can avoid the headaches of harvesting labor for the chile crop and almost guarantee their profitability by planting alternative crops such as alfalfa and small grains.

 v      New Demand – with food for fuel, there is a growing awareness of the increasing value of farm land.  This translates into a desire by the growers to increase the returns.  With more alternatives than they have had previously, growers are demanding and receiving higher prices for the inputs they provide. 

 Tomatillos

 At Border Foods, our pack season is nearly complete – we will not see additional tomatillos until late summer or early fall.  The just completed campaign found supplies and quality to be very good to excellent.  Pricing on tomatillos is steady to firm. 

Jalapenos

                 There are adequate supplies currently available although the window on these supplies will be closing early March.  Current supplies are priced higher than we have seen in recent history.   

                Looking forward, jalapeno crops are transplanted and that process is just underway and will continue for approximately sixty days.  Given normal growing conditions, the newly transplanted jalapenos will begin to be harvested in early June and will continue through November.   

                The quality of jalapenos available today is very good, supplies are adequate, and prices are very firm and definitely higher than they were a year ago.   

Green Chile

                 There are some supplies currently available outside of our normal growing areas.  Pricing on the current supplies is twice what we paid during the harvest.  We are comfortable in having existing supplies to cover our sales commitments, new demand will necessitate reaching into the spot market and buyers will have sticker shock at the “new” pricing.  Regardless, if you need chile prior to the NM harvest, we would be delighted to help you with your sourcing needs.  The available “off season” availability is very limited.   

Locally, seeding will begin in approximately two weeks.  With higher prices for land, energy and labor inputs, pricing on 2008 harvested chile will be significantly higher than we offered in 2007.