Extreme weather threatens the global supply of tomatoes
The tomato market is highly concentrated. Although tomato production takes place in many countries, large-scale production is concentrated in only a handful of countries. China, India, Turkey and the USA are responsible for the production of most of the world’s tomatoes. Together, these four countries account for 60% of the global supply of tomatoes. The same four countries are also the four largest consumers of tomatoes.
The tomato trade is highly regionalized, with the US importing most Mexican and Canadian tomatoes, while products from EU producers largely stay within the bloc.
This is mainly due to the perishability of the fruit. Fresh tomatoes cannot be easily or cheaply transported long distances for fear of wastage. Instead, tomatoes are generally sold over longer distances in the form of tomato paste.
Around 39 million tons are processed annually around the world. Processed tomatoes are widely used in a range of easily recognizable products, such as ketchup and pasta sauce.
European heatwaves put harvest at risk
Recently, temperatures in southern Europe have skyrocketed, leading to forest fires on the islands of Rhodes, Corfu, Crete and Evia. Although some European tomatoes are produced in northern Europe, southern countries such as Spain, Portugal and Greece account for much of European tomato production. Crete is home to Greece’s largest tomato crop.
In Spain, Extremadura is the primary tomato production region. Temperatures have risen in recent years.
In addition, Morocco, which supplies most of France’s tomatoes, earlier this year restricted exports of tomatoes to the EU as the country faced a lack of rainfall.
Tomato prices have skyrocketed due to the shortage. European imports of Moroccan tomatoes have decreased since the beginning of 2021 but the value has steadily increased.
The cost per ton paid in January 2021 was just over €1,200, according to Eurostat data, but by April 2023 it had almost doubled to €2,280.
Indian tomato prices rise
India – the world’s second largest tomato producer – is experiencing its own weather-related tomato problems.
Intense rains in recent months have decimated the Indian tomato crop and caused the spread of a fungal disease.
Madhya Pradesh is the country’s largest tomato-producing state, accounting for nearly 15 percent of the total. This is followed by Andhra Pradesh with 11% and Karnataka with 10%. As a result, local tomato prices have quadrupled, according to a report by The Guardian. The situation is not expected to stabilize for at least three months.
Tomatoes are not traded in standardized contracts on commodity exchanges. That means we can’t offer price history on tomatoes, but we have a range of other commodities, currencies, indices and stock prices for those interested in a low-cost stock program.
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