The New Mexico chile is the heart and soul of our state’s culture and is the state’s iconic agricultural commodity. During the 1990s, the New Mexico chile harvest hovered over 30,000 acres, but, fast forward to 2020, and that acreage has drastically decreased to only 8,500 acres.
According to the USDA’s Agricultural Statistics Service, New Mexico growers produced 68,000 tons of chile with
79 percent being sold for processing and 21 percent sold on the fresh market in 2020. Those involved in our industry are responsible for the creation of 4,500 jobs and contribute
$450 million to our state’s economy, however, they are faced with several issues that are leading to our state’s signature crop being grown elsewhere.
Due to the increase in expenses, New Mexico farmers are planning to increase their sale prices by 13 percent to
20 percent to processors in 2022 and are expecting to increase direct retail sale prices on fresh green chile products. These increased prices will trickle down to the consumer. This leaves consumers in a difficult situation of deciding to pay more for New Mexico grown chile or choose chile grown and harvested in Mexico.
What is causing this increase in consumer prices? Increased expenditures to grow, harvest and process New Mexican chile. Our farmers are hit from every angle of increased costs of production, including a 50 percent increase in fuel prices, doubling of fertilizer prices and overburdensome food safety requirements, to name a few. These issues are exacerbated with labor shortages created during the coronavirus pandemic, and simply paying laborers more in wages will not solve this labor shortage. It is simply more expensive and troublesome to harvest New Mexico chile.
New Mexico processors are also feeling the effects of recent policies and are forced to increase their prices, doubling down on the price increase to consumers. Processors are seeing double-digit increases in packaging materials, 25 percent increase in labor expenses in 2021 (when labor was available), energy expenditures have doubled and freight expenses are continuing to rise with no end in sight.
Our industry cannot sustain new environmental regulations or policies that increase the cost of doing business in New Mexico. Our members strive to produce and process the world’s greatest chile while always considering the cost of their products to consumers, however, we are at a tipping point. Continued over-regulatory policies at the state and federal levels will result in our farmers harvesting less chile, forcing our processors to purchase chile in Mexico. Our New Mexico chile industry is worth saving, but we need policies that allow our farmers to do what they do best — farm. We need policies that allow our processing businesses to grow and provide New Mexico chile products that are affordable for consumers.