In the United States corn is king in Iowa. Texas produces the most cotton. Florida is known for its citrus groves and Kansas rules in wheat production. The potato is tops in Idaho and Arkansas is known for its rice.

But in the Land of Enchantment—New Mexico—the most common question asked in restaurants, supermarkets and wholesale packing houses is “do you want green or red?” –referring to the state’s most fabled crop, the chile pepper.

Growing and consuming vast amounts of chile in New Mexico is more than just tradition; it represents the heart of agricultural production. But New Mexico’s most famous crop arguably has been under assault in recent years and a steady decline in chile production has painted the industry into the proverbial corner.

“New Mexico remains the top producing chile pepper state in spite of declining chile acres in recent years. And though more acres were planted in 2011 than in recent years, the industry remains depressed largely because of foreign imports,” says Jaye Hawkins, executive director of the New Mexico Chile Association.

The decline in New Mexico’s chile production has been dramatic since the early 1990s when over 35,000 acres of chiles were planted. By 2010 chile acreage had fallen to just over 8,500 acres, and in spite of 10,000 planted acres of chile last year, industry officials say problems from foreign imports continue to mount.

“Chile consumption is up in the United States but imports of both red and green chile peppers are depressing domestic production,” Hawkins said.

 In fact, the decline in chile acres can be traced back to the early days of the North American Free Trade Agreement, or NAFTA. While mechanized harvesting is possible for the state’s red chile crop, green chile is still largely harvested and de-stemmed by hand.

“For the longest time we had a problem finding immigrant farm workers willing to work in the fields. Before the recession, construction jobs were abundant and immigrant workers could make more money moving from farms to cities. That problem is not as bad now as it once was, but we are still competing with chile grown and harvested in Mexico, China and Peru where labor costs are much lower,” Hawkins adds.

Consumption up

While U.S. chile consumption has grown more than 600 percent in recent years, foreign imports now account for about 80 percent of all chile consumed domestically, leaving a smaller slice of the pie for New Mexico growers.

Producers in New Mexico say another problem they are facing is that young farmers are abandoning chile in favor of more profitable crops. While traditions run deep on the farm in New Mexico, making a profit is more important.

“The number of acres produced each year is driven by contract production, meaning the crop is sold before it is ever planted. No one is really willing or able to farm chile on speculation anymore. There is just too much competition from foreign imports,” Hawkins says.

While research continues on better methods of mechanized production of green chile in New Mexico, a move that would greatly reduce labor costs, other challenges exist including disease pressure and more recently drought conditions.

“Chile grows well in arid climates but water is still required. Irrigating from ground wells increases production costs considerably, and New Mexico hasn’t escaped the drought conditions experienced all across the Southwest,” Hawkins said.

Working in favor of local chile production is the insatiable appetite for red and green chile of native varieties. New Mexicans remain the largest consumers of chile peppers grown in the state.

“New Mexico consumers are savvy about chile quality and variety and there will always be a demand for Hatch chiles, for example. Chile is still roasted in parking lots each fall and restaurants are loyal to native varieties. This is working in our favor, but this alone can’t salvage an industry threatened (so much) by foreign competition,” Hawkins says.

But recent increases in state production and chile acres provide some encouraging news for growers. Hawkins says the industry is very active in marketing and branding efforts to promote the state’s leading commodity crop.

For more information about New Mexico’s leading crop, visit the New Mexico Chile Association Web site.