What Causes Price Fluctuations in Limes?

What Causes Price Fluctuations in Limes?

In 2014, the price of limes in the U.S. soared over 400 percent compared to 2013.  A case of limes, which once sold for $15-$20, now sold for around $100.  Consequently, the price of margaritas, guacamole, and other popular items dependent on limes crept up as well.  Eventually the price stabilized to a more moderate market price, but for months everyone felt the impact of such a price surge, from lime growers in Mexico to bartenders in New York.  This kind of fluctuation in the price of limes (and other citrus) is not uncommon, and there can be many causes.

What caused such a spike in pricing?   Currently, Mexico is the predominant exporter of limes to the U.S., providing 98% of the limes consumed.   There are a host of factors that influence lime pricing, but in 2014 multiple factors combined to produce such a dramatic upswing.  The most significant of those was the impact of drastic fluctuations in weather.  In 2014, Mexico experienced late cold fronts, followed by heavy rains.  When it rains heavily in Mexico, it results in stylar breakdown, a disease that affects the opposite end of the stem.  It appears as a discolored, water-soaked spot on the lime, and affects the overall taste and quality of the lime.  Heavy precipitation followed by warm weather results in the most stylar breakdown.  Hurricanes also have an obvious impact on lime harvesting, not only because they result in this stylar breakdown, but because they impact harvesting hours and production time.  Mexican limes have also fallen victim to Huanglongbing (HLB), a citrus-greening disease that results in a reduction in fruit size, premature fruit drop, and a bitter or salty flavor of the lime juice.  Hard to contain and capable of spreading quickly, HLB remains a threat to lime crops, as no remedy currently exists.

Lime production is also impacted by the effect of drug cartels in Mexico.  When lime prices soar, the extortion of lime farmers by drug cartel members is common.  There have been reports of armed cartel members robbing trucks of limes headed to the U.S., or holding farmers at gunpoint on their farms.  While one might not expect the lime market to be associated with drug cartel activity, this is yet another factor that impacts U.S. lime prices.

While the price surge in 2014 did eventually come down, the U.S. has continued to see drastic price swings in limes in the years since.  The aforementioned factors don’t appear to be going anywhere, so consumers can expect to continue to experience drastic price fluctuations in limes.  Time will only tell how recent natural disasters from 2017 will influence the market price of limes in the months to come.

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