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Peppers Under Pressure Preserving the Business of Red and Green |
by D’Lyn Ford
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After 400 years, chile’s status as signature crop of New Mexico is well preserved in memories and freezers throughout the state. But the $250 million pepper processing industry that has emerged over the last 30 years faces intense international competition and weather, disease, and insect problems. Every segment of the industry--from red and green chile to cayenne and jalapeño production--is under pressure.
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Labor-intensive crop: Crews hand-harvest chile near Hatch |
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A worker at Jurado Farms in Las Cruces shovels cayenne peppers into a truck. |
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Year of contrasts: Widespread damage to the chile crop was evident during a tour of Cervantes Enterprises’ cayenne fields last summer (left). Those attending, from left to right, included Jerry Schickedanz, dean of NMSU’s College of Agriculture and Home Economics; Emma Jean Cervantes; Andy Nuñez, legislative liaison for NMSU’s College of Agriculture and Home Economics; and U.S. Senator Jeff Bingaman of New Mexico. Even in 1999, however, growers like Raymond Viramontes of Deming harvested near-record crops (right). |
In 1998, those involved with the industry reached a sobering conclusion: In five years, pepper processing in New Mexico could be history. To prevent its loss, members of New Mexico State University’s Chile Pepper Institute helped form a Chile Pepper Task Force in December 1998.
"If someone wanted to bring an industry to New Mexico that was worth more than $200 million and generated exports that provide a net benefit to the state’s economy, we’d pay attention," says Lou Biad, a Mesilla Valley processor and staunch task force proponent. "Chile production and processing is already here, and we’re a proven industry that fits with the culture, land, and economy. We’re worth keeping."
That conviction motivates the task force’s coalition of growers, processors, crop consultants, economists, agricultural engineers, drip irrigation experts, vegetable specialists, plant breeders and mechanical harvester manufacturers.
"Attending a task force meeting is like going to chile college," says Rich Phillips, a horticulturist and project manager with NMSU’s Agricultural Experiment Station.
After 15 years of domestic and international work, Phillips describes serving as the task force’s first coordinator as his most diverse and challenging assignment. He has drawn inspiration from the industry-wide cooperation, regular jogging and a favorite Margaret Mead quote: "Never doubt that a small group of people can change the world. Indeed, it is the only thing that ever has."
The task force is making sure New Mexico’s chile industry is cost-effective enough to be competitive in a global marketplace. Three working groups focus on modernizing the local industry. The mechanical harvesting group is assuring that New Mexico isn’t left behind in harvesting and cleaning technology. A best management practices group is drawing on farmers’ wisdom and field research to find ways to improve stands and increase yields. A drip irrigation group wants to tap the technology for healthier, more productive plants.
"We can compete in our varieties, our growing and our processing," explains Ed Hughs, coordinator of the task force’s mechanical harvesting working group. "But we can’t compete in our harvesting and cleaning because of the costs of manual labor."
Hand-harvesting accounts for a whopping 40 to 60 percent of a New Mexico chile grower’s production costs. "Just the $1 per hour increase in the minimum wage that’s been proposed is more than workers in some Third World countries earn in a day," says Biad, who regularly deals with suppliers as far away as Zimbabwe. He is a partner in Biad Chili Co., which operates three red chile dehydrating plants, and Rezolex, a paprika oleoresin extractor business that makes natural food colorings.
Though New Mexico growers and processors have faced the labor differential for years, it became an imminent threat as competition heated up in the 1990s. A prime example: Until 1995, fresh chile imports from Mexico trickled through New Mexico ports of entry in Santa Teresa and Columbus. That year, imports skyrocketed from 2,600 to 22,000 metric tons.
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Chile Pepper Imports from Mexico through New Mexico Ports of Entry Source: Clyde Eastman. Includes all fresh chile except bell peppers imported through Santa Teresa and Columbus ports of entry
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Two factors were the catalysts: the North American Free Trade Agreement and the Mexican peso devaluation, according to Clyde Eastman, NMSU rural sociologist emeritus. "NAFTA made it easier to import, and the sharp decline in the value of the peso made it a great boon to sell the crop for dollars," Eastman says. "As a result, we got a substantial increase in chile imports, which seems to be continuing for the foreseeable future."
Ironically, the state’s dominance in pepper production started to decline during a decade of red-hot growth in the mid-1980s. By 1991, salsa had dethroned ketchup as the condiment of choice. Demand also increased for chile-based products such as paprika powder, food colorings, cayenne mash, frozen Mexican foods and jalapeño nacho wheels.
But as it grew from a regional to global business, the industry attracted competition from China, India, Mexico, Pakistan, Peru, Spain, Chile, Israel and South Africa. Between 1984 and 1994, U.S. capsicum imports increased by 85 percent.
New Mexico’s chile acreage peaked in 1992. As cheaper labor pulls production outside the United States, growers fear that the processing industry will follow the crop. Task force members believe mechanical harvesting and cleaning equipment is vital to their survival.
"I would say the chile industry right now is at about the same place that the cotton industry was 40 or 50 years ago," says Hughs, an engineer and research leader with the USDA’s Southwestern Cotton Ginning Research Laboratory on the edge of the NMSU campus. "It wasn’t until 1960--not that long ago--that more cotton was machine-harvested than hand-harvested."
