April 30, 2014 in Business

Lime industry getting squeezed by shortage

Associated Press
 
Associated Press photo

Dana Stolzner squeezes lime juice on his guacamole, while drinking his own “Dana Margarita” a coconut based margarita cocktail at the bar of El Coyotein Los Angeles. The price of a lime has skyrocketed in recent weeks, quadrupling or, in some areas, going higher.
(Full-size photo)

Grown in Mexico

More than 90 percent of the limes consumed in the United States are grown in Mexico.

LOS ANGELES – Every time a bartender at trendy Los Angeles fusion eatery Luna Park squeezes a shot of lime into a drink these days, owner Peter Kohtz says he winces a little.

Luna Park, known for its large selection of craft cocktails, is one of thousands of restaurants from coast to coast that have fallen victim to the Great Green Citrus Crisis of 2014 – a severe shortage of limes that has meant that the fruit has skyrocketed in price in recent weeks.

A case of 200 or so fetches between $80 and $130 now, up from about $15 last year – the result of a perfect storm of circumstances from citrus disease that struck Florida in 2001 and wiped out most lime groves to flooding to the efforts of drug cartels to disrupt supplies in Mexico, the biggest U.S. supplier.

The cost might not seem like that big of a deal until one realizes that it’s lime juice that’s squeezed into every margarita, mojito or mai tai. It’s also lime that’s chopped up and mixed with fresh fish to create ceviche. It’s lime, mixed with avocado, that makes up guacamole – a mainstay at every Mexican restaurant.

“It’s just one of those things that you take for granted. You never really think about it because it’s always there,” said Kohtz, noting his bartenders squeeze an entire lime’s worth of juice into most specialty drinks.

So far, the price spike doesn’t seem to have been passed on widely to consumers, according to industry officials, but people are beginning to notice it in other ways.

Alaska Airlines stopped putting limes in in-flight beverages a couple of weeks ago. At a recent luncheon meeting of the California Restaurant Association’s board of directors, association spokeswoman Angie Pappas said limes were noticeably absent from the buffet bar, which featured Mexican food.

One of the luncheon attendees, a Southern California restaurateur, told her he is offering a free appetizer to any customer who brings in a bag of limes from their backyard tree. In Phoenix, the Arizona Republic reports that a bar and restaurant group is offering a free cocktail, glass of wine or beer to anyone who brings in 5 pounds of limes.

If limes grow on backyard trees in Los Angeles and Phoenix, why are they so expensive? Because they don’t really grow well enough in most of the U.S. to be produced commercially, says Jonathan Crane, a tropical fruit crop specialist at the University of Florida’s horticultural sciences department.

Until 2001, Crane said, Florida produced half of all the limes consumed in the United States. But then a devastating citrus canker outbreak led officials to order almost all of Florida’s lime groves destroyed and the industry never recovered.

Mexico began producing more than 90 percent of the limes now consumed in the United States.

In most of California, the weather isn’t warm or humid enough to produce commercial quality limes, and the state has only a few hundred acres in production near the Mexican border.

Mexico’s crop, meanwhile, was hit by a myriad of problems this year, including unusually heavy rains and citrus disease in some areas. The Knights Templar drug cartel used to jack up lime prices by disrupting deliveries and shaking down farmers in western Michoacan state, but that problem has declined in importance following an offensive this year by federal forces and vigilantes who took up arms against the cartel.

Like American mobsters, the drug cartel that controls much of the Mexican state of Michoacan where both limes and marijuana grow in abundance, has been muscling in on legitimate businesses.

A Mexican official said last month the cartel extorts as much as $1.4 million a week from legitimate businesses, mainly lime and avocado growers. In some instances, he said, the cartel is now running some of the state’s wholesale lime distribution centers where prices are set.

Last winter’s storms, which triggered major floods across western Mexico, also destroyed crops, and a plant disease that struck the Mexican state of Colima damaged still more.

The result, the price of limes has shot up dramatically in both Mexico and the U.S. Restaurants in Seattle and New York have reported paying as much as $130 a case for them.

As the industry waits for the summer crop to lower prices, some restaurants and bars nationwide are pulling lime drinks off their happy hour menus. Others are substituting ingredients like lemons or oranges, said Annika Stensson of the National Restaurant Association.

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