The Reason For The Sriracha Shortage Is Actually A Lot Spicier Than You'd Think

For those of you who have been living under a rock, sriracha is the most popular hot sauce in America, and among the top most popular condiments. The most iconic sriracha brand is Huy Fong, a company started by David Tran, an immigrant from Thailand, back in the 80s. Whether you’ve tried it or not, you’ll probably recognize the bottle with the rooster on the front and the green cap, symbolizing the product’s freshness. The main ingredient is fresh red jalapeño peppers along with other flavorful ingredients like garlic and vinegar.

About those jalapeños...

In 1988, Huy Fong formed a partnership with Underwood Farms in California. Underwood farms grew all those red jalapenos for the sriracha sauce. However, this union was rocked in 2017 when the two got locked in a legal battle against each other. The folks at Huy Fong believed that they were overpaying for the peppers from Underwood Farms. What happened was Tran pushed for more and more acreage for sriracha jalapenos in Underwood Farms, which also grows other crops as well. This means less space for the other crops. As a form of reassurance, Tran and Underwood agreed that Tran would pay per acreage versus by yield. To make it worse, Huy Fong started a new company called Chilico with the purpose of accumulating even more peppers. And to make things even more worse again, Tran attempted to whisk away the COO of Underwood farms to join Chilico. Not a smart move. Underwood Farms sued Huy Fong for a breach of contract, and Huy Fong sued back, although Underwood won the case unanimously and received a total of 23.32 million dollars.

Where do the peppers for Huy Fong sriracha come from now?

Since the split, Huy Fong has been getting its peppers from Mexico. Unfortunately, Mexico has been experiencing extreme droughts the past couple years, damaging crops. This lack of peppers creates a lack of sriracha, which is what has been causing the shortages from the past couple years. A true Rube Goldberg, years in the making.

So what now?

Currently, this sriracha shortage has caused prices to skyrocket. If you check out eBay, a 28-ounce bottle of the stuff doesn’t sell for any cheaper than $20. One listing for a 136-ounce tub is selling for over $200 plus $31.45 for shipping. That’s about $1.50 per ounce. Another important update is that Underwood farms is now selling its own sriracha sauce with the original peppers. Does this spell a future competitor in the sriracha game in the U.S.?