Friday, March 7, 2014

Michoacán lemons, very pretty - and expensive

"Lemon tree very pretty, and the lemon flower is sweet"

*Updated Apr. 20*
Guadalajara -
Lemons and limes are a staple of the Mexican diet. Not to garnish a margarita (a drink almost never consumed by citizens of this country, who greatly prefer tequila solo - a shot straight up), but as a seasoning of sorts used on all types of food. Perhaps it helps cut the fire of the three alarm salsas everybody eats.

The popularity of the humble limón - millions of which are also exported to the north, where they line the rim of those premium eight dollar 'ritas in many a Tex-Mex restaurant on Friday nights - has lots of Mexicans worried these days, restaurateurs, street food vendors and consumers alike.

In February lemon and lime prices rose an astounding 68%, to an average of 40 or 50 pesos a kilo, compared to the month before. At today's exchange rate that's about $3.50 USD for just over two pounds. And in Mexico City the price soared to 65 pesos. One year ago a typical price was 10-12 pesos, or 75-90 cents.

The above chart, prepared by Mexico's National Statistical and Geographical Institute (INEGI), shows how much selected Mexican grocery store produce rose in February, including limes, watermelon, grapes, papaya, bananas, onions and cucumbers.

A July 2013 university study in Guadalajara reported that almost two-thirds of Jalisco residents don't earn enough to purchase the monthly minimum "shopping basket"

In the case of lemons and limes, the explanation is easy. Mexico's largest producer is Michoacán, which has been ravaged over the past year by organized crime violence and endlessly warring drug cartels. Lemon and lime growers, almost without exception, have been required for years to pay huge extortion fees to the reigning regime in the region, Los Caballeros Templarios. Lack of security in the region coupled with political uncertainties have wreaked havoc with normal production and delivery, and may have led to hoarding and price speculation. Federal troops flooded Michoacán in January, but some parts of the state remain extremely unstable, according to a federal agency official this week. Mexican Human Rights Comm'n. says there's no local law in Michoacán.

Economists predict that prices will soon return to normal. In a country where every centavo counts, that day can't arrive soon enough. Over 60% of Jaliscans earn less than subsistence income.

Mar. 13 - Mexico's Federal Consumer Protection Agency reported today that the nationwide average price of limes is 45 pesos a kilo, a 174% increase just since December. And avocado prices could be the next to take a steep climb: In Michoacán, Peña Nieto makes no mention of "outside the law" citizen militias.

Mar. 14 - Limes are as valuable as cash, and may have become a new form of currency in this country. In Veracruz state on Mexico's Gulf coast, a tractor trailer rig filled with the produce was hijacked this week. The Freightliner was found soon after, with 127 cases of the 632 it was carrying still inside. Apparently the bandits were not equipped to haul off all the loot. The gross value of the merchandise was about a million pesos, almost $80,000. The driver was unharmed.

Mar. 16 - MGR made a quick tour of one of Guadalajara's largest city markets yesterday, where limes were readily available for 34 pesos the kilo. While that's still high, it's 15 pesos less than the posted price in Soriana, Mexico's major grocery chain.

Mar. 19 - Clip from KWES NewsWest in Midland-Odessa, Texas, quoting MGR's report

Mar. 23 - A Mexican agricultural producers advocacy group, the Confederación Nacional Campesina (CNC), has asked the country's Federal Consumer Protection agency to apply a "firm hand" to any retailer asking 80 or more pesos ($6.15 USD) for a kilo of limes, noting that such a price is double that charged for a kilo of chicken or pork. The CNC said limes have skyrocketed in the last 90 days, and in many locations a kilo is now more than the Mexican minimum daily wage - 65.53 pesos a day. The group claims the actual production cost of a kilo of limes averages 19 to 23 pesos. CNC said the huge prices being charged by the middlemen are rigged, while suppliers blame them on a myriad of other factors, including drug war violence in Michoacán. CNC's argument may have validity, but the question then becomes, why hasn't this happened before? No such dramatic price increases were seen in 2011, 2012 or 2013.

Mar. 24 - The average national price of a kilo of limes in Mexico is now 60 pesos ($4.60 USD).

Apr. 8 - Noting that the shortage of limes in the U.S. is due to "bad weather in Mexico coupled with drug war violence," CNN reported today that some American airlines have stopped serving them with in-flight cocktails. In many parts of Mexico the price of limes has dropped dramatically, but that's not been the case in Mérida. Diario de Yucatán reported yesterday that through Apr. 4, limes averaged 60 pesos ($4.62 USD) the kilo in area retailers.

Apr. 20 - Limes have dropped to an average price of 40-45 pesos per kilo in Mérida markets, local news sources reported today.

Jan. 5 - U.K. report: life is getting harder, not easier for Mexicans

Dec. 20 - Mexican minimum wage in 2014 will be $5 dollars - a day
July 29 - 53.3 million - that's how many Mexicans live in poverty
June 12 - 59% of Mexicans remain trapped in underclass
Feb. 20 - Mexico has 14th largest global economy, but citizens rank 81st in food purchasing power

Nov. 11 - Seven of 10 Mexican households report food shortages

Michoacán violence, 2014
Mar. 5 - Mexico's Human Rights Comm'n. says there's no local law in Michoacán
Feb. 17 - Michoacán belongs to organized crime: 55% of Mexicans
Feb. 14 - Michoacán, a deadly no man's land
Feb. 4 - In Michoacán, all the president's men arrive with cash and promises
Jan. 13 - Michoacán security accord more of the same old song

The lemons were out of sight but not out of reach as hungry Méridans gathered to eat after services on the Feast of Guadalupe, Dec. 12, 2011. The fruit is found at every such street food stand, along with salsas and condiments.

© MGR 2014. All rights reserved. This article may be cited or briefly quoted with proper attribution or a hyperlink, but not reproduced without permission.

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