>> This is where tequila comes from, large succulent agave plants harvested squeezed, fermented, and distilled. But thirsty patriots in cities like New York and Tokyo are drinking so much tequila, that Mexico's $2 billion industry could be facing a crisis. In the western state of Jalisco, the tequila heart land an agave shortage caused by this increasing demand has producers worried.
Reuters' corresponding Christine Marie is in Mexico city.>> Growing demand for tequila as well as new industries using agave plants have sent the price of agave up almost six times in the last two years. That's meant there is more producers have had their margin squeezed and they're finding it hard to stay afloat.
>> The agave plant takes seven to eight years to mature, but farmers are now harvesting plants far younger than they should be to make up for the growing shortages. The agave plants produce less tequila, meaning more plants have to be pulled up early from the limited supply, creating a downward spiral.
Tequila industry experts tell Reuters that this habit of early pulling may mean the agave shortage will be even worse in 2018. And could eventually effect the larger distillers who recently got in the game.>> Demand for tequila has led to a floury of deals in recent years. In January Bacardi said, it would buy Patron Spirits for $5 billion, and last year, Mexico's Casa Cuervo finally did its IPO.
>> The question posed by many tequila makers now, is how to keep up with its global success? According to the distilled spirit council, demand from the United States, tequila largest buyer, has grown almost 60% in the last decade. That's a lot of margaritas.