The Tomato Supply Chain: Current Situation and Key Challenges
The global tomato supply chain operates in an increasingly complex environment, shaped by climate factors, evolving agricultural practices, and shifting market dynamics. How does the current landscape look, and what challenges lie ahead?
Global Overview of Tomato Production
United States
Production expectations are declining. The total contracted volume for 2024 was 10.25 million tons, dropping to just 9.25 million tons for 2025. In California, high stock levels from previous years have prompted a supply-demand balancing strategy, leading to reduced production—a process initiated last year. High operational and labor costs, coupled with ongoing water shortages, continue to pressure the industry, further lowering the 2025 production target.
China
A sharp production decline of up to 40% is expected in 2025. Lower farmgate prices may discourage planting, while international demand for Chinese tomato products is weakening due to forced labor allegations, further driving prices down.
European Union
Production is projected to decrease by 5% overall, with Italy seeing a 6% increase and Spain experiencing a 22% drop following last year’s recovery. The European Commission forecasts stable EU production at 11 million tons for 2025. Over the next decade, production is expected to grow, with a focus on lower-concentration processed products, which face less competition from imports.
2025 Outlook
Lower overall product availability is anticipated, reinforcing concerns about rising costs across all production levels.
Italy and the Tomato Market: Growth and New Challenges
The first projections for the 2025-2026 season from AMITOM (International Mediterranean Association of Processed Tomatoes) indicate a 25% production decline across member countries. However, Italy stands out with a 6% increase, primarily in the north.
In a record-fast agreement, the price for Italy’s Northern crop was set at €145/ton, reflecting a 5% increase against 2024, when negotiations remained unresolved. Talks in the South will begin in February, with expectations of reduced production due to ongoing drought conditions.
A widening price gap between conventional and organic tomatoes is likely. Conventional tomato prices are expected to rise by €4-5 per ton, while organic tomatoes could see a €35-40 per ton increase due to previous years’ climate-driven raw material challenges.
Energy costs will be the most significant factor affecting final product pricing. Even if stable, they are projected to remain 40% higher than last season. More precise data will be available by May. In contrast, paper and tinplate prices are not expected to rise significantly, though their impact will still depend on energy costs.
Between April and May, industries will need to finalize cost negotiations for key components. Experts widely anticipate that 2025 will be a year of inflation, with rising costs affecting the entire supply chain.
