The California peach industry has suffered an unprecedented collapse. But it will be repeated, it will be repeated a lot, it will be repeated all over the world
Richard Lial He lived peacefully in his little house in Escalonnorthern California. He had acres and acres of productive almond trees that he had been exploiting for the last decade. But three years ago, just when costs began to become unsustainable, Del Monte (one of the largest fruit and vegetable companies in the world) made him an offer. A 20-year contract for Lial to exchange its almond trees for the peaches that the company’s large cannery in Modesto needed. Del Monte’s move put on the table some 550 million over the next few years and a business of tens of thousands of tons per season. The problem is that on July 1, 2025, Del Monte Food Corp declared bankruptcythe Modesto plant has closed and, with it, the entire Californian peach industry has collapsed. What exactly happened? Del Monte accumulated a debt of 1,245 million dollars on the day they filed the bankruptcy petition. And the reason is simple: in recent years, the company had been going into debt to make certain purchases in a sector that was in full decline. Today, the world consumes less canned goods and Del Monte executives believed that the only way to survive was to grow and ensure margins. The problem is that, with the rate increase in the months prior to the bankruptcy declaration, interest had doubled to the point of eating into the operating margin (a margin already quite affected by things like Trump’s tariffs that had made cans more expensive). The chaos has lasted for many months, but on February 6 the courts approved the sale of the company in parts. Peach growers breathed easy until they discovered that none of the buyers wanted the plant of Modesto. And why is that plant so important? Well, because Del Monte did not ask farmers to plant the peach they wanted. They were asked to plant the clingstone variety: a peach that simply has no fresh market. The pulp of the clingstone adheres to the bone and makes direct consumption uncomfortable. That is, it is a variety whose only destination is processors. In this case, the Modesto plant consumed 35% of the production of this stone fruit, about 50,000 tons in 2026. They are, to be honest, 50,000 tons that are now almost impossible to place anywhere. But the problem transcends 2026… Because the contracts that Del Monte I was signing Until a few months before the bankruptcy, they forced farmers to make investments of around $8,000 per acre in exchange for the peace of mind that comes with a 20-year contract. They went into debt for it. Many made the transition in 2023. So there are about 140 Californian farmers fgame era and some 1,200 jobs will be lost. But the impact is deeper. And it is not that talking about ‘sector cataclysm’ is not justified, it is that the central issue is the structural dependency that the dynamics of the primary sector are pushing the economy towards. …and that transcends even the peach. Because it doesn’t matter what product we look at: the consequences of financialization are there. It is enough to remember that in 2015 there were only 45 funds specialized in ‘agrobusiness’ in the world; Today they exceed 1,000 and move an enormous amount of money that is radically changed the way everything is managed. The rresult is as simple as it is tragic: Capital arrives, exploits the land as if there were no tomorrow, exhausts the territory’s resources, abuses the local socio-productive fabric and leaves. One day we will realize that there will be nothing left. Image | Ayla Meinberg In Xataka | Spain faces its greatest agricultural challenge of the century: converting 1,901,529 hectares of olive groves into irrigation before it is too late
