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Growth is sizzling in nearly $6 billion tortilla industry

By David A. Sylvester
San Jose Mercury News

	JILL JOHNSON / FORT WORTH STAR-TELEGRAM Jaime Garcia looks over the tortilla line at Leo's Foods in Fort Worth, Texas. Sales of tortillas in the United States have grown steadily by almost 10 percent a year in part because of the popularity of "wrap" sandwiches. Leo's Foods also produces a chocolate-flavored tortilla.
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At its current rate of growth, the tortilla will surpass white bread as the top-selling bread in the United States by the end of this decade. The torrid growth of tortilla sales marks a dramatic shift in U.S. culture and culinary tastes.

"It's so universal to use," said Manny Berber, president of Mi Rancho, a tortilla company in San Leandro, Calif., with 150 employees. "There are more choices when you use a tortilla."

Mi Rancho, which sells to restaurants nationally, has found overall tortilla sales to be robust even through the recent economic slowdown. Sales are doing well for tortillas marketed by private-label companies as well as specialty flavors ranging from chili tomato to spinach, Berber said.

Nationally, tortilla sales have grown steadily by just under 10 percent a year and are expected to hit $6.1 billion next year, according to the Tortilla Industry Association.

That may sound slow by tech standards, but it has doubled the size of the industry since 1996. According to the association, tortillas have 32 percent of the market for all types of bread, compared with 34 percent for white bread.

And the tortilla market is heating up fast. While supermarket sales of white bread dropped 0.6 percent in 2002 from the year before, tortilla sales grew 11 percent, according to market-research company IRI. Private-label tortilla sales jumped a whopping 26 percent.

The traditional corn tortilla is the basic bread of Mexico. But the flour tortilla became widely used when "wrap" sandwiches caught on as a new fast food, and they now sell slightly more than the corn tortilla.

The plain white flour tortilla has turned into a rainbow of colors: the reddish sun-dried tomato, the green spinach-flavored tortilla, even a dark-brown chocolate tortilla.

"I don't know what they use them for, but people love them," Leo Jimenez, 73, said of the chocolate tortillas made by his Fort Worth, Texas, company, Leo's Foods. "We try to give customers what they want — within reason."

Meanwhile, some tortilla makers have avoided the fiercely competitive retail shelves and developed niche products.

La Tortilla Factory in Santa Rosa, Calif., sells low-carbohydrate tortillas to take advantage of the popularity of the Atkins diet.

To reduce the carbohydrates, the tortilla is prepared with oat fiber along with soy flour and whole wheat flour. The fiber reduces the amount of carbohydrate absorbed to only 3 grams — far less than the traditional 25 to 40 grams in most tortillas, said Jenny Tamayo, marketing manager.

Last month, her company launched an organic tortilla and is experimenting with different flavors using various vegetables.

"A lot of people are using it as a bread replacement," Tamayo said.

Copyright © 2003 The Seattle Times Company