In the first half of December, Del Monte Foods announced it has initiated the process to divest its Hanford-based facility (see also related articles below). The sale of the Hanford plant is not expected to influence Del Monte Foods' branded tomato product lines, which encompass brands such as Del Monte, Contadina, Take Root Organics, and S&W. Bibie Wu, Chief Communications & Technical Development Officer, remarked, "This was an extremely difficult decision, but one the company needed to make to align the business with consumer demand." It has been confirmed that no other facilities within Del Monte Foods' network will experience changes as a result of this transaction. Details regarding the timeline for the plant's closure and the potential impact on its workforce have yet to be disclosed.
This decision by Del Monte Foods should therefore not impact California's total tomato processing capacity for the 2025 season. As it stands, according to the information presented by Morning Star in its annual report, the fourteen plants in operation are capable of handling almost 12 million tonnes (t, metric), i.e. 2 million t more than the quantities actually processed during the 2024 season.
The major characteristics of the Californian sector do not show any notable change: ten plants are operated by companies (marketers) whose products are primarily intended to be marketed to secondary processing companies; their number has not changed since 2020, after the two Olam processing sites ceased operations; Similarly, since the Unilever Bestfoods Stockton site closed that same year, the number of companies that use their production for their own internal use (remanufacturers) has remained stable at four.
The relative importance of the two types of companies in the US sector in terms of processing capacity has changed little since 2016/2017: marketers represent around 87% of total Californian capacity, remanufacturers 13%.
Total Californian capacity has remained virtually unchanged since the significant drop recorded between 2019 and 2020; over the last five years, the figures defined for a standard campaign length bring the quantities likely to be processed in one season to just over 11.8 million tonnes, for an estimated production of tomato pastes of around 1.65 million tonnes of finished products.
There is only one change to be noted for the capacity operated in 2024: data provided by Morning Star indicates a 5% increase in the capacity of the Liberty Packing site in Santa Nella compared to 2023.
These figures must be considered in the context of the prospects for processing of the upcoming 2025 campaign. Speaking on this subject at the Tomato News Online Conference on December 4, Aaron Giampietro of Morning Star specified that "Anticipating that production plans for 2025 will also decrease versus 2024 for the entire state. Wouldn't be surprised to see a production target of about 10.5 million short tons, which would be about nine and a half million metric tons.”
In a recent interview with Tomato News, Mike Montna, president and CEO of CTGA, believes that “Given the US situation, the right thing to do, the prudent thing to do, and I'm all in favor as reducing acres, let's just process what we can sell, that's the only way you can keep a healthy industry in today's climate, don't try to overproduce.”
“I believe we're going to be doing less acres this year, that's a strong belief and it's necessary in order to keep things in line and healthy, because, like I stated earlier, if you can't sell it, we probably shouldn't be packing it, in today's climate you don't want to be sitting on inventory for very long.”
Some complementary data
Comparison of California’s processing capacity in 2027 and 2024
For further details and data, you can access the full report published by Morning Star in May 2024 by clicking here.
Source: Morning Star
