MexECON Blog

WSJ Article on Tomato Market

Yesterday's Wall Street Journal (on-line version, 3 March 2010) carried an interesting article discussing the current high prices in the U.S. tomato market.  The article noted that the high prices stem from a January freeze that wiped out most of Florida's tomato crop.  It said that prices for a 25-pound box of tomatoes are now several times the level one year ago, forcing some restaurants to cut tomatoes from their menus.  With Florida's supply sharply reduced and prices soaring, the article quotes USDA data showing that weekly vegetable shipments from Mexico to the United States have risen by as much as 50% from year-earlier levels.

Comment:  The Journal article correlates well with what we have heard from our portfolio companies and other sources in Mexico.   It also offers validation for Terra Nova's decision to focus in large part (though not necessarily exclusively) on investments in Mexican agriculture.  With much of U.S. agricultural production on ice during the winter, prices can get very high, and freezes and other adverse weather problems in California and Florida can push prices even higher.  Terra Nova continues to explore new opportunities where we can take advantage of such anomalies by producing food products south of the border. 

Patrick Fearon, CFA
Vice President, Fund Management

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