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Nogales produce distributors say higher prices are staying put

Boxes of mangos are stored inside a Nogales warehouse.
Posted at 9:46 PM, Sep 23, 2021
and last updated 2021-09-24 01:31:50-04

NOGALES, Ariz. (KGUN) — The pandemic’s supply chain challenges are being felt at the grocery store this year. Americans are paying more for food in 2021.

Like the food industry at large, produce distributors at the U.S.-Mexico border in Nogales are feeling the effects of high inflation and other factors.

Jaime Chamberlain, president of his family’s 50-year-old company Chamberlain Distributing, says everything from seeds to boxes to labor are getting more expensive.

“Everything that surrounds farming has gone up,” he said.

Chamberlain Distributing handles more than 100 million pounds of produce every year.

Chamberlain also built a new facility, St. James Cooler, an “In and Out” service center that takes in Mexican produce shipments before sending them to customers across the U.S.

Distribution has become more costly over the past year as the pandemic pushes fuel and freight rates higher, amid a widespread truck driver shortage.

“So in some cases we had the freight cost was the exact amount or exceeded the contract cost for the product itself,” Chamberlain said. “That ended up being a recipe for disaster.”

The COVID ripple effects also forced many farmers to cut down on crop sizes this year, leading to less supply.

Eventually, all of that adds up to higher prices for customers at restaurants and grocery stores.

“It’s a combination and a domino effect that ends up, that the consumer ends up paying,” Chamberlain explained.

Produce retail prices

Not all produce is affected equally. According to the USDA, the retail prices for items like cucumbers, squash, carrots and romaine lettuce are up by more than 10 percent over last year.

The fall means more vegetables coming in from Mexico, which could help prices stabilize a bit.

“You’ll start to see that trend come down as far as prices are concerned because there’s going to be a bit more availability,” Chamberlain said. “But I still think they’re going to be higher prices than we’ve seen in the last two years.”