HATCH, N.M. (KRQE) – There was a time when New Mexico’s farmers harvested tens of thousands of acres of chile a year. Last year, farmers harvested just 8,500 acres, a 75% decrease from the all-time high, back in the 1990s. In fact, in 2021 New Mexico had its smallest chile pepper production in more than a decade.

Those numbers come from the U.S. Department of Agriculture, and they highlight what farmers have known for some time: New Mexico chile is facing some big challenges. And depending on who you ask, the future of the state’s favorite crop could be in jeopardy.

To learn what’s behind the shrinking numbers, and what the future of chile may look like in the state, KRQE News 13 interviewed chile producers around the state and headed to Hatch, NM to speak with chile growers, roasters, and retailers.

A decline in numbers

Statistical records on New Mexico chile go back to the 1970s. Every year since then, the U.S. Department of Agriculture (USDA) has been tracking just how much chile is grown in the state.

Last year, New Mexico’s total yield of chile hit a multi-year low. Just over 50,000 tons of chile were produced in 2021. In the last decade, yearly production has been closer to 70,000 tons each year. And 2021’s production was less than half of the all-time high of 106,850 tons produced in 2004.

The total number of acres harvested has been declining since 1992, when over 34,000 acres were harvested. Last year, farmers only harvested 8,500 acres.

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New Mexico’s total number of acres of chile has been on the decline for the last few decades. In part, this is because farmers have been able to get more chile out of less land. But it may also reflect some issues like labor shortages. Data from USDA. (Graphic created by Curtis Segarra for KRQE News 13.)

To some extent, the numbers are a testament to the fact that farmers have managed to get more chile out of fewer acres of land. In fact, growers can get six to eight tons out of an acre of land now, compared to one and a half tons per acre back in the 1970s.

But despite getting more out of the land, some growers say they’re having trouble getting that crop to market. The low number of chiles harvested last year backs up what some growers told KRQE News 13: The industry is struggling.

Workers too picky for chile picking?

Standing next to his chile field in Lemitar, New Mexico, Glen Duggins takes on an air of dignity. He points out that he doesn’t want any weeds in the pictures of his chile. He wants the well-tended rows of Sandia variety to look beautiful and delicious. After all, they’re a symbol of New Mexico. And Duggins takes pride in his work as a farmer and as the president of the New Mexico Chile Association.

But according to Duggins, not everyone shares that sense of duty. And he feels that it’s hurting the industry.

“I never was told, ‘Mijito, don’t work too much.'” Duggins says. “My dad, if I had three jobs, it would have pleased him.”

But for American workers, the culture is different now. And Duggins says he’s having trouble finding young people who are eager to work in the field.

“Last year, I bet I hired, I don’t know, at least 50 [workers] from the States and some of them, when we drove out to the field, they turned around and never even got out of their cars,” Duggins says. And some of the people that do want to pick chile are often unprepared for the harsh reality of heat, sunburn, mosquitoes, and the occasional rattlesnake, he adds.

Incentivizing labor

Duggins isn’t the only business owner in the chile industry that’s had trouble finding and keeping workers. In fact, it’s such a big problem that the state has stepped in to try to fix the shortage.

For several years, New Mexico chile farmers have been sounding the alarm on a lack of labor. Back in 2020, the chile supply chain experienced a COVID-19 pandemic-induced labor shortage. In response, New Mexico carved out $5 million in the state budget to support the industry.

The program, called the Chile Labor Incentive Program, is designed to supplement wages paid to chile pickers and producers. For example, if a chile picker earns $13 an hour, CLIP would add an additional $4.50, bringing their total hourly rate to $17.50.

The funds were supposed to “incentivize labor” and to “attract and retain” workers, according to the state’s Department of Agriculture. And for a seasonal job that often pays around $15 per hour, an extra $4.50 seems significant.

But while those added funds may have helped some farmers, it’s clear the funds haven’t been a “silver bullet” in solving the industry’s labor problem. After all, along the chile supply chain, many people told KRQE News 13 they’re still having labor issues, even with the incentive.

Workers from Mexico might be the answer – for some

Chile picking is seasonal work, meaning farms can take advantage of U.S. Immigration’s H-2A visa to hire workers from south of New Mexico’s border. The program allows New Mexican farms to employ workers from Mexico or other countries for temporary work, with a maximum stay of 3 years.

It’s a process that’s meant to help fill empty jobs throughout the U.S. So, it might seem like an obvious solution for filling the gap in New Mexico’s chile workforce. But some farmers say it’s an imperfect solution.

“It’s very cumbersome for a farmer. It’s very expensive for a farmer,” says Travis Day, the executive director of the New Mexico Chile Association. “They just can’t make those programs work for them.”

Day is talking about small farmers in particular. He says one of tougher elements of the visa program is the vast amount of paperwork involved in the application process. And because H-2A requires that the employer provide housing at no cost to the workers, as well as three meals a day — or at least ample cooking facilities — employing workers from outside the U.S. is a major endeavor.

To help farmers navigate the challenges, labor contractors offer to provide migrant labor without all of the hassle. But even labor contractors say they’re seeing dwindling numbers of people interested in picking.

“How I’m seeing it, year by year, there are fewer and fewer [workers interested in picking each year.] Comparing it to 10-15 years ago, there were a lot of people, and now there aren’t,” says Evelina Gomez, who works as a supervisor at Alpha Labor Contractor. “And it’s because all the young kids are looking for a better future.”

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To meet the demand for New Mexico’s famous Hatch Green Chile, Grajeda Farms relies on workers from Mexico. (Photo Courtesy: Curtis Segarra, KRQE News 13.)

Gomez helps oversee dozens of chile workers, some local and some from places like Texas and Mexico. She spoke in Spanish with KRQE News 13 Reporter Aleli Elizondo: “Right now it is hard. It is very hard because nowadays, no one wants to do that work. People don’t want to do it since they can now make the minimum wage anywhere,” Gomez says.

“And I don’t blame them,” she adds. “If I was in their shoes, I would do the same.”

Gomez says the state’s Chile Labor Incentive Program does help motivate some workers. But she estimates that the labor force today is roughly half of what it was 10 years ago. And many that do want to work are those from the older generation, implying a negative outlook for the future.

On top of it all, inflation

Just as shoppers across the U.S. have seen the price of necessities rise, farmers saw the costs of their much needed supplies rise as well. It seems that all along the chile supply chain, no one was immune.

“Fertilizers and a lot of pesticides you might need to use are, like, almost doubled this year,” says Steven Sichler, who owns part of Snake Ranch, which grows chile in San Antonio, New Mexico. “It’s all inflation.”

It’s not just growers who are feeling the sting of inflation. Gerald Pino at Gilly’s Chile in Hatch, New Mexico says roasting also costs more.

The cost of propane — which powers the three roasters in the back of his shop — has gone up, he says. But he doesn’t want to put that on the consumer by raising the price of his chile.

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Pino at Gilly’s Chile says labor issues and propane costs are tough this year. But he doesn’t want to simply raise prices. (Photo Courtesy: Curtis Segarra, KRQE News 13.)

And chile processors, who turn fresh chile into salsas and sauces, are also seeing the effects of inflation. Eddie Garcia, from Garcia’s Kitchen, told KRQE News 13 that they have been dealing with unexpected price increases that aren’t always factored into the usual business expenses.

“It’s been difficult,” he says. “There’s just a lot of [materials] out of stock or a lack of supply. So, there’s a lot of costs that are not in the prices.”

Some considering an exit from the industry

With labor and cost issues throughout the industry, it’s no surprise that some farmers have considered leaving the business. In fact, some have left the industry.

Craig Sichler used to grow chile with his family business. They’d been farming in New Mexico for generations. But a few years ago, he quit. We asked him why he stopped. His answer: It just wasn’t worth it.

“It wasn’t worth enough money,” he says. “The wholesale rate of chile, that only went up about maybe $2 or $3 in my 10-year period I grew it.”

After ditching chile, Sichler has since switched to growing alfalfa. A big benefit with alfalfa, he says, is that farmers can harvest it mechanically. There’s no reliance on a shrinking pool of workers.

Axten Franzoy, the farm manager at Chile River, Inc., predicts the labor issue is only going to get worse. And that means more farmers might throw in their hat.

“I think it’s going to transition to more H-2A [labor] per year, up until the point to where this labor gets so expensive that it’s not cost effective to grow green chile,” he says. “And if we’re not getting a good return on the crop, you know, eventually we might be looking to plant something else, to be honest.”

Others hunkering down and relying on consumers

Given all the rising costs, and a negative outlook on labor, you might wonder if New Mexico’s chile products could start disappearing from the shelves. But for all the pessimism and frank economics local farmers are experiencing, there seems to be an equal amount of determination to keep chile alive and keep it local.

“Our farmers are going to assure that the consumers are going to have New Mexico chile on their plates,” says Travis Day from the New Mexico Chile Association. And Duggins agrees. After all, this isn’t the first time the chile industry has encountered headwinds.

For example, back in 1995, farmers saw nature turn against them. USDA production records tell of hardship and pestilence: “Chile production fell in 1995 due to weather and disease. Soon after farmers planted chile, strong winds damaged the newly planted crop causing several farmers to replant. Some fields never recovered from the wind damage; other fields were damaged by freezing weather in April, hot and cold spells through the early part of the growing season, and finally, disease and insects.”

But Duggins says farmers are up to those kinds of challenges. And he says they’re up to the challenges of today.

“We’ve crossed hurdles every year. It’s how we’re made,” Duggins says. “We don’t quit.”

And a big help for struggling farmers, according to Duggins and Day, is the demand from consumers. The New Mexico Chile Association pushes a certification program to label locally grown chile as “New Mexico Certified Chile™.” The idea is that the label helps consumers distinguish local chile from chile imported from Mexico.

To the same effect, around a decade ago, the State of New Mexico actually made it illegal to advertise imported chile as “New Mexico chile.” And numbers from the New Mexico Department of Agriculture show that local businesses are relying on this law to carve out a niche for their products.

In 2012, a total of 57 vendors had registered with the state’s certification program under the New Mexico Chile Advertising Act. By 2021, nearly 300 vendors had registered, the data shows.

And indeed, for those who push through the challenges, there is still a market for New Mexico chile. In fact, some growers and processors told KRQE News 13 that they’ve seen demand rise, particularly from out of state.

Eddie Garcia, at Garcia’s Kitchen, says they’ve seen demand rise. And that’s been a big help.

The retail side of the business has “really taken off,” he says. “We have a loyal clientele that wants to purchase it in the convenience stores or in the supermarket.”

Fresh chile exporters have also seen growing demand. When KRQE News 13 visited Grajeda Farms in Hatch, New Mexico, workers were getting ready to load pallets of burlap-bagged chile onto a truck. Edgar Grajeda says that batch was headed to Denver, Colorado.

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Grajeda Farms bulk-bags chile, much of which is loaded onto trucks and shipped to places like Denver, Colorado. (Photo Courtesy: Curtis Segarra, KRQE News 13.)

Grajeda told KRQE News 13 that in a given season, they’ll process a million pounds of chile or more. That’s because he says the demand just keeps going up.

Family keeps chile alive

While they’ve experienced all the challenges a farm can face, just like all the other farms throughout New Mexico, Grajeda says his business is about family, and that keeps him going. In fact, as Grajeda was loading chile palettes to ship, and his father, Uvaldo, was getting ready to drive to the field to show pickers from Mexico which chiles were ready for harvest, Grajeda’s son was there too.

He had just gotten out of school for the day. And while Grajeda’s son is still too young to help out any time soon, Grajeda says one day his son just might take over.

And that’s exactly how most of New Mexico’s chile businesses have been operating for decades — as family operations. The Sichler Family, Gilly’s Chile, Garcia’s Kitchen, and Glen Duggins’ operation, they’re each a family business. Axten Franzoy, from Chile River, and Evelina Gomez, with Alpha Labor Contractor, they too are working alongside and in the footsteps of their parents. And that’s not something that’s likely to end any time soon.