American farmers flourish in Mexico
Field workers harvest green onions Wednesday afternoon on Larry Cox's farm south of Mexicali. (FERNANDO ACOSTA JR. PHOTO / October 21, 2012)
Between vegetable production and trucking, Scaroni has been in business for 25 years. Increasingly frustrated with a regulatory environment that he described as hostile, immigration policies that are out of touch with reality and the desire to diversify his operation, Scaroni ventured into international business. He expanded his business into Guanajuato in central Mexico.
Scaroni is hardly the first American farmer to seek better opportunities on the other side of the border.
“American farmers have been going to Mexico for as long as I can remember,” said Tom Nassif, president and chief executive officer of Western Growers, a crop industry trade association.
“It seems to be cyclical,” Nassif said. “They go over there for a while because they have trouble getting labor. They go over there and have some success. The regulatory environment isn’t as strict.”
Chronic labor shortage was one of the reasons Scaroni invested in Mexico.
“I’m uneasy about the lack of a stable migrant labor supply,” he said. “We have to have a meaningful immigration solution. Legal or illegal — we are consistently short.”
How short? Scaroni said his U.S. operation is consistently short of labor by about 10 percent.
“We’re consistently working 10-hour days,” he said. “What we’re doing is not sustainable.”
Scaroni is quick to debunk the notion that doing business in Mexico is cheaper.
Farming is, by nature, a seasonal activity. Farmers plan their crops according to the season, weather conditions and soil conditions, and hope that extreme weather does not wipe out their investment.
“You go to Mexico to diversify geographical risk,” Scaroni said. If extreme weather destroys his crops in the Imperial Valley, he has his fields in Mexico to fall back on.
Why aren’t more farmers rushing to do business in Mexico?
‘Not for the faint of heart’
Simply put, it’s not easy.
“I got humbled,” Scaroni said. “I misestimated the cultural battle I would fight.”
Scaroni said his staff in Mexico did not work with a sense of urgency that is typical in American business. He described a “mañana” approach to work, where if it doesn’t get done today, it can wait for tomorrow. Maybe.
“Startup was extremely difficult; working against a culture that doesn’t lend itself to ‘just in time’ production,” he said. “There was a lack of a sense of urgency.”