Saturday, December 17, 2016

Limes by Allen Laudenslager

Limes are very popular in the US and we get most of our limes from Mexico. Because of a spell of bad weather and disease in the lime groves of Mexico there was a very poor crop of limes. A standard 40-lb. box of limes that would have cost a San Francisco bar manager $20 a few months ago cost more than $120 during the shortage.

US lime production, mostly centered near Homestead Florida, was decimated by hurricane Andrew in 1992 and again by disease in 2000. Naturally Mexico stepped up their production and increased the size of their lime groves. Land and labor in Mexico are much cheaper so they became the prime supplier.

We now have a price increase of 6 times the original price and no alternative but to pay the price. If the US lime industry had rebuilt to anywhere near their former size there would be little problem but with the significantly lower price of Mexican limes, the Florida growers didn’t invest and the land was turned to other uses.

Back in the bad old days of managed capitalism – like the 1950s and 1960s – the government had a practice of buying American made produce and products to maintain a minimum level of production capacity. We did that primarily in manufacturing to protect our supplies in case of war. We found during the 2nd World War that some critical supplies were either in short supply or unobtainable because they came from nations that we ended up at war with or had to be transported across combat zones.

While limes are not critical to the nation, they do point out the undisclosed risks of not maintaining a production base. We end up without some locally produced items that either makes creating something else possible or drives the cost up high enough to make it unavailable to a large part of the population.

In the case of limes, it never was that the US growers couldn’t compete; it was that they couldn’t make a high enough profit to satisfy the corporate owners. Please note that it was NOT about profit and loss but rather about how much profit.

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