Why the sriracha shortage... isn't

 

Like many others, I've noticed how hard it's become to find Huy Fong-branded sriracha sauce in supermarkets these days.  I initially understood, from cursory glances at news articles (like this one from last year, for example) that it was due to a shortage of hot peppers (caused, of course, by the dreaded and hyped-to-death "climate change" - what else?).  However, the reality appears to be rather more complicated.

Strained supplier relations coupled with adverse agricultural conditions have left Huy Fong Foods’ sriracha out of stock at many grocers nationwide. Bottles of the hot sauce were going for as much as $52 on third-party sellers such as Amazon as of Thursday.

Underwood Ranches, a farm owned by Craig Underwood based in Ventura County, California, supplied Huy Fong Foods’ peppers for 28 years. Underwood told CNBC that he could have kept up with demand if he were still the company’s supplier.

After a dispute between the two parties led to a legal battle that began in 2017, the long-term relationship between the manufacturer and supplier ended.

Huy Fong Foods claimed it overpaid Underwood Ranches for its crops from the 2016 season.

“We had been investing in the next year’s crop and crop beyond. So we felt that was really our money. But [Huy Fong founder David Tran] decided to sue us for that. And when he did, we countersued,” said Underwood.

Meanwhile, the company began contracting with new farmers, even though it already had made an agreement with Underwood Ranches for its 2017 crop supply.

“In the end, Craig Underwood won a $23 million judgment from a jury that was in Ventura County, in his backyard. But he also had to pay David Tran back the $1.5 million that Huy Fong says they overpaid,” said CNBC special correspondent Jane Wells, who covered agriculture in California.

There's more at the link, and in the extended video report below.  It makes interesting viewing.

I'm a little taken aback by peoples' insistence on buying Huy Fong-branded sriracha.  The sauce is not exclusive to them:  it's a well-known Thai sauce that's been around for decades.  Huy Fong marketed its brand very well, and came to dominate the US market, but it's by no means the only choice.  Other brands are still relatively freely available, because they didn't get crossways with their pepper suppliers as Huy Fong did, and have thus been able to continue production.  I've tried a couple of those other brands, and they taste just fine.

On the other hand, some people have made good money out of the shortage of Huy Fong sriracha.  One acquaintance read about Huy Fong's 2020 warning of a shortage of chili peppers and began stocking up on the stuff.  She built up a stash of about three hundred bottles, and when the price exploded due to the shortage (at one point I saw online prices as high as $65-$75 per bottle), she began listing them on eBay, Craigslist and other markets.  She reckons she made over $10,000 from her accumulated supply - a very nice return on her investment.  I asked her how she'd been able to foresee such wild demand, and she just shrugged and said that American consumers knew the Huy Fong brand, but not many of the other sriracha sauces out there.  She relied on consumers continuing to demand the brand they knew, without realizing that "sriracha" isn't a brand name as such, but a generic name for all sauces of that type.

I don't use much sriracha, and that mainly as an ingredient in curries and other spicy foods (and very sparingly at that).  I don't like to put it directly on my food, because I find it overpoweringly spicy-hot as a condiment.  (On the other hand, a blend of Tabasco hot sauce and sriracha makes for an interesting flavor combination, if used sparingly - I say again, sparingly!!!  I tried some last night, and it works for me.  Purists who like either sriracha and/or Tabasco don't seem to like the combination, but that's a matter of taste, I guess.)

Peter