Yahualica is a town in West Jalisco that is famous for the production of the chile de arbol, which is used mainly for the manufacture of bottled sauces. 9,000 residents of the area depend on this activity, i.e. more than a third of the 23,000 people that live in the town.
More than a decade ago, they began to have a problem: China began producing chile de arbol. Not only that, but they introduced it in Mexico at cheaper prices, which affected the domestic production, curbed the chances of adding value to it, and deterred them from expanding their production area. Mexico is a world leader in the production of fresh chili, but not very strong in the production of dried chili.
The chile de arbol is a red dry chili that dates from the time the Spanish arrived in Mexico. It also occurs in Pakistan, Chile, and Peru, but it is China that absorbs 30% of the domestic market. The Chinese product has an average market price of 3 dollars per kilo, while the Mexican product has to be sold for 4 to 5 dollars to offset production costs.
The region has 580 hectares devoted to the cultivation of this variety of chili. Yahualica has 260 hectares (and at one time even got to have 300 hectares) and contributes about half of the production, estimated at 1,500 tons per year.
"10 years ago, production costs per hectare stood at 40,000 pesos (i.e. about $2,000 dollars), and right now they are at 70,000 pesos (i.e. $3,500 dollars). However, in the current situation, we can not give added value to the chili, we can't make a sauce with it because it would be too expensive. If things continue like this, there will come a time when we won't be able to sow it.
There are many people who have moved to other parts of the country and are growing something different because the product coming from China is taking us out of business. The Chinese chilies are marketed next to ours and people buy the cheapest ones because they don't have money," stated Luis Antonio Plascencia, one of the most representative producers in the area.
Don Antonio lives in the community of Manalisco, in Yahualica. The cultivation of chili is a family tradition, he said, but unfortunately not all of the producers have the resources to face the crisis. In the past, there used to be 150 producers devote to the production of this chili but now there are only about 60.
One differences between the Mexican and Asian products is that the Asian's spiciness is felt at the tongue, while the Mexican product is spicy in the throat, this makes it more tolerable to the consumer.
Producers are unwilling to give in to the competition and after years of knocking on doors and having their demands dismissed, they are now working with the mayors of the area on a tourism project to help reposition the Mexican chile de arbol. They also hope that the chile de arbol from Yahualica is given the designation of origin soon, so that imports can not use that name.
In western Mexico, 11 municipalities in the states of Jalisco and Zacatecas also grow the chile de arbol and the imports are also affecting them. Therefore, they decided to join efforts to rescue the economy of their areas.
The Mayor of Yahualica, Alejandro Macias Velasco, stated that they had developed a tourism project with the producers to create La Ruta del Chile (The Path of the Chili), a tourist attraction that would let visitors get to know the Mexican chili, with visits to the fields where they are grown, the factories where they process them to make sauces, and samples of the different dishes they can be used in, such as the drowned cake -a typical dish of the region to cure a hangover - and how it can be added in different drinks, like tequila and mezcal.
Agriculture is the second economic activity of the municipality and chili is the fourth product that brings more revenue.
"China imports have been affecting us for a long time because the chili is an important part of our economy, it provides permanent employment for 10 months and more than 300 families live from this industry. However, most of them can't add value to their products because we've been having this problem for a long time.
I don't understand how Mexico allows imports of this product. We know that some of it is smuggled, and we also know that we have to find a way to reposition ourselves. Otherwise, we are going to lose one of our economic engines," said the mayor.
The project is the first of its kind in Mexico. In 2017, they will conduct a census of the producers in the municipalities that will be part of the route, which will include visits to processing plants that have been making sauces and vinegars for the past 60 years. Producers and authorities already have resources to start this project and they expect to start having visitors in 2018.
In 2014, as part of another of their strategies, producers initiated the procedures to apply for the designation of origin in the 11 municipalities that produce chili; 2 years later they are still waiting.
"That's very important for us because we in Mexico have started to import chili from India, Japan, Pakistan ... and we will do whatever it takes to rescue our sources of employment and the economy that the chili generates," the mayor said.