Tomato Glut: Sell Fresh, Dry, or Leave in the Field?
A farmer has 2 ha of tomatoes and expects 35 t over a three-week harvest. In the first week the local wholesale price collapses from $0.55/kg to $0.12/kg because three neighbouring farms are also harvesting. Sending fruit to the city market 180 km away costs $0.30/kg in transport plus commission, and carries a 15% reject rate. She owns a solar-assisted dryer that processes 500 kg of fresh fruit per day into dried tomato at a 12:1 fresh-to-dried ratio, drying to about 8% moisture. Dried tomato sells for $4.50/kg, but she has one buyer who will take about 40 kg per week and has not confirmed a price for larger volumes. Fuel and electricity for the dryer cost $18/day, and one worker is needed at $10/day. Harvesting and grading cost about $0.06/kg, and packaging for dried product costs $0.80/kg.
1. Calculate the gross margin of each route for 500 kg of fresh tomatoes and decide what she should do with this week's harvest.
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Per 500 kg fresh.
- Local fresh sale: 500 × $0.12 = $60, less harvest and grading at $0.06/kg = $30, leaving about $30.
- City sale: $60 revenue, less 500 × $0.30 = $150 transport - clearly negative even before commission and the 15% reject rate. Do not send this week's glut to the city.
- Drying: 500 ÷ 12 = 41.7 kg dried; at $4.50/kg = $187.50. Costs: fuel $18, labour $10, packaging 41.7 × $0.80 = $33.36, harvest and grading $30 - total $91.36. Gross margin ≈ $96.
Decision. Drying returns roughly three times as much per 500 kg as local fresh sale, so process as much as the dryer can take. But capacity is the limit: 500 kg/day × 21 days = 10.5 t, well short of the 35 t harvest. The remainder must be sold locally, held briefly under shade, or left unharvested where the price will not cover the $0.06/kg picking cost.
Caveat on the dried market. One buyer taking 40 kg/week absorbs only one day's output. Before running the dryer at capacity she must confirm volumes and price with that buyer or find others - restaurants, processors, regional traders - otherwise she converts a fresh glut into a dried glut. Run the dryer only for confirmed orders and sell the remainder fresh.
2. A neighbour says drying is pointless because "nobody eats dried tomatoes here" and she should simply not harvest. Evaluate this advice and design a realistic three-week disposal plan.
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The neighbour is half right, and that half matters. Local demand for dried tomato may be thin, and one buyer at 40 kg/week cannot absorb 840 kg over three weeks. Producing dried fruit nobody buys simply adds cost. But "do not harvest" is too blunt: it ignores the premium fresh grade and the fact that a small, pre-sold dried volume is profitable.
Framework: grade and route each fraction.
- Grade 1 fruit: sell fresh locally or to a committed buyer whenever the price covers the $0.06/kg picking cost.
- Grade 2 and surplus: dry only against confirmed orders - realistically 40–80 kg dried per week, that is 500–1 000 kg fresh, one to two dryer days.
- Rotten or unmarketable fruit: do not pay to harvest it; consider composting or animal feed, after checking that pesticide residues are within label restrictions.
- Lowest grade left in the field: a calculated loss, not a failure.
Three-week plan. Week 1: obtain written orders and prices for dried product, run the dryer one or two days, sell the rest locally. Weeks 2–3: repeat, and approach other farmers to aggregate volume for a buyer, which strengthens the bargaining position. Keep records of every sale so next season's planting decision rests on data rather than hope.