Lime prices spike after shortage in Mexico

Posted at 4:04 PM, Apr 11, 2014
and last updated 2014-04-11 16:04:25-04

(CNN) – In Mexico, they’re practically a sacred institution.

The mighty lime is used in drinks, food, and well just about everything.

In recent months, a big drop in production has meant limes are in hot demand – and prices have shot up.

Grower Juan Leana Malpica says he is receiving 20 times as much for his limes as 6 months ago.

Prices normally rise at this time of year – but there are other more important factors.

“There’s the devastation caused by a citrus disease. Then there is climate change. With the arrival of winter there has been a cold snap in neighboring states. And what I feel is most devastating are the price speculators.”

He also points to recent insecurity in the state of Michoacan, a top lime producer.

Many growers simply can’t or won’t get trucks on the road.

Those most directly affected are Mexican consumers.

“I normally buy two kilos,” one  shopper says, “But now I buy a half and only use them for absolute essentials.”

Mexico is the world’s largest lime producer and markets in the U.S. and Europe are also feeling the brunt.

Businesses on Manhattan’s upper west side are feeling the pinch.

“I can tell you this time last year we were paying approximately $36 a case. The first delivery this morning was $110 dollars a case. We’ve not passed that onto the guest and don’t plan to.”

All the same, with so many items on the menu dependent on limes, the chain of 15 restaurants says it will have to pay an extra $650,000 dollars this year if prices stay the same.

This means a big pay day for those growers who have not been hit by shortages.

“Producers are going to invest their money in the own fields because that’s the way of improving, one exporter says. You can fertilize better, you have more possibilities to put in a system of irrigation.”

The Mexican government is also trying to ramp up future supply by introducing new methods to produce limes all year round.

The government and farmers expect prices to begin falling in may.

Their concern is the recent experience may leave consumers and businesses …a bit sour.