Hot sauce prices rise as chilli shortages squeeze supply

Hot sauce is becoming a little harder to swallow for consumers as rising costs push prices higher. Poor harvests and adverse weather have reduced the supply of key chilli peppers creating upward pressure on prices. At the same time, strong consumer appetite for spicy condiments has kept demand resilient, widening the gap between what producers can supply and what consumers want. With climate-related disruptions and production challenges adding extra heat to the market, the humble bottle of hot sauce is offering a textbook reminder that when supply tightens, prices rarely stay mild for long.

Caribbean hot sauce producers warn of shortages and higher prices - BBC News

1. Using a demand and supply diagram, explain why the market price of hot sauce has risen.

2. Some farmers have switched from growing chilli peppers to more profitable crops such as sweet potatoes. Assess the likely impact of this change on the markets for both chilli peppers and sweet potatoes.

3. Discuss whether a government subsidy for chilli producers could help reduce shortages in the chilli pepper market.