Port Delays Worsen as Harvest of New Crops Approaches

By Ching Lee,  AgAlert

As ongoing port congestion and persistent shipping obstacles continue to block movement of California agricultural goods, farmers and exporters face bulging warehouses and dwindling cash flow that threaten to sink some businesses.

Tree nuts, fresh produce, dairy products and other California farm commodities struggle to find rides on vessels and containers in which to ship them, with ocean carriers rushing to set sail empty rather than hauling agricultural exports.

“We have 50 loads packed and ready to ship, that customers would take tomorrow, that we can’t get on the ship,” said Bill Carriere, a Glenn County walnut grower and handler.

Agricultural exporters say their shipping problems—which trace to pandemic-related supply-chain disruptions that started in 2020—have only gotten worse. More shipping companies have notified them that they won’t stop at the Port of Oakland to pick up containerized farm products, which account for 60% of total exports through the port. The companies opt instead to return ships directly to Asia following long delays in the ports of Los Angeles and Long Beach.

Only one ocean carrier—Mediterranean Shipping Co.—so far has committed to servicing the Port of Oakland, said Roger Isom, president and CEO of the Western Agricultural Processors Association and California Cotton Ginners and Growers Association.

The Northern California port saw 67,910 empty containers leave its shores during the first two months of this year. That’s compared to 37,263 empties during the same time in 2020, according to a letter that agricultural groups, including the California Farm Bureau, sent to the Biden administration last week. The letter further noted that three out of four containers at U.S. ports return to Asia empty.

Because ships continue to bypass the Oakland port, exporters say the opening in March of a new “pop-up” yard for pickup of empty containers has offered limited relief. The temporary hub, located offsite of the port, allows shippers to stage export loads while avoiding busy marine terminals where most empty containers are stored.

As of last week, there were more than 500 containers in the yard, said port spokesman Robert Bernardo. The port saw 83 ships stopping in Oakland in March, compared to 93 a year ago. Reduced vessel arrivals were due in part to a COVID-related port shutdown in Shanghai, the port said.

Though the port has enough empty containers to cover current demand, Bernardo said supplies remain “in constant flux.” He said he expects inventory to tighten as imports from China begin to resume.

Aside from dealing with a shortage of containers, agricultural shippers say they struggle to secure bookings, which often get canceled or “rolled,” meaning the cargo wasn’t loaded onto the scheduled vessel, usually because there’s no room.

To read more, click here.

2022-05-04T12:14:43-07:00May 4th, 2022|

Westlands Water District awarded $7.6 Million Grant by the California Department of Water Resources

Grant Funds Will Help Create Drought Resilience, Increase Investment In Recharge Projects, and Drive Regional Groundwater Sustainability

 Today the California Department of Water Resources (DWR) awarded Westlands Water District, which serves as the Groundwater Sustainability Agency (GSA) for the Westside Subbasin, a $7.6 million grant as part of the Department’s Sustainable Groundwater Management (SGM) Proposition 68 Implementation Grant Program. This grant provides critical investment in the District’s efforts to ensure a sustainable groundwater basin.
“As we enter the third year of historic drought, Westlands remains committed to utilizing the most proactive, innovative, and scientifically-sound strategies in groundwater management,” said Tom Birmingham, general manager of Westlands. “This grant funding from DWR will be instrumental to the District’s implementation of the Sustainable Groundwater Management Act and to achieving groundwater sustainability. We are grateful for the support and investment in these vital projects.”
The grant funding will further three key efforts within the Subbasin: the Storage Treatment Aquifer Recharge (STAR) Program, Phase 1; the Westside Subbasin Groundwater Sustainability Plan (GSP) 5-year Update; and the Westside Subbasin Geophysical Investigation for Recharge Potential.
The STAR Program will establish a network of treatment and aquifer storage and recovery (ASR) facilities in the Westside Subbasin. These facilities will treat water from the unconfined upper aquifer and provide temporary storage of surplus supplies. Based on current design, each treatment facility could treat up to 10,000 acre-feet a year and each ASR well could inject up to 1,200 gallons per minute to be stored for later use. Phase 1 of the STAR Program includes planning and identification of locations for the treatment facilities.
The funding will also support the District’s 5-year review and update of the Westside Subbasin GSP. This update enables the District to assess the implementation of the GSP and incorporate the latest information on groundwater conditions, technology, and science. The 2025 update will reflect progress towards achieving the Westside Subbasin 2040 sustainability goals, key groundwater project, and SGMA regulations compliance.
Lastly, the grant provided by DWR will also provide funding for the Westside Subbasin Geophysical Investigation for Recharge Potential. This Investigation consists of conducting geotechnical examinations on lands within the Westside Subbasin to identify groundwater recharge potential. The data collected will help interested parties, such as growers and/or the District, determine if a proposed site is feasible for groundwater
2022-05-03T11:03:46-07:00May 3rd, 2022|

Fresno County Farm Bureau Recognizes Journalists


FCFB Celebrates Agricultural Champions and Journalistic Excellence

After a two-year hiatus, Fresno County Farm Bureau held its third annual “Bounty of Fresno County” celebration on Thursday, April 28, at Wolf Lakes Park in Sanger.

Fresno County Sheriff-Coroner Margaret Mims was recognized with the FCFB “Friends of the Family Farm Award” for her vigorous support and contributions to Fresno County agriculture and rural communities. Sheriff Mims has served as the 25th Fresno County Sheriff-Coroner since November of 2006 and is now finishing up her final year of service.

Additionally, FCFB announced the winners of the 28th annual Journalism Awards.

Serving as judges for the Journalism Awards were Fresno Chamber of Commerce Chief Operating Officer Amy Fuentes; California Cotton Ginners & Growers Association and Western Agricultural Processors Association’s Assistant Vice President Priscilla Rodriguez; and FCFB President Daniel Hartwig.

Award winners received the coveted FCFB tractor trophy, which was generously donated by Kuckenbecker Tractor Company.

The criteria for the awards were: thorough and objective coverage of issues, given time and space limitations; educational element for the agriculture industry or the consumer; and portraying the personal stories of those who make up the food and agriculture industry, making issues relevant to consumers and Valley residents.

Audio

Patrick Cavanaugh, Ag Information Network, “Initial Zero Allocation Is Part of Massive Decline in Water Availability,” February 2022.

Farm Trade Print

Todd Fitchette, Western Farm Press, “Rice Fields Benefit Endangered Salmon,” January 2022.

General Print

Edward Smith, The Business Journal, “Growers, Experts Say Conventional Wisdom Around Drought is Flawed,” June 2021.

Video

Aurora Gomez/Reuben Guerra, ABC30, “Children First: Firebaugh High School’s FFA program,” September 2021.

“Heavy Puller Award”

18THIRTY Entertainment was recognized with the FCFB “Heavy Puller Award” for their many shows featuring agriculture including American Grown: My Job Depends on Ag, Tapped Out, Silent Sacrifice, and the Creek Fire documentary.

2022-05-04T12:10:00-07:00May 2nd, 2022|

Giulia Marino, Mae Culumber Named Presidential Chairs for Tree Nuts

UC ANR names Marino, Culumber Presidential Chairs for Tree Nuts

 

By Pan Kan-Rice, UCANR Assistant Director, News and Information Outreach

Two UC Cooperative Extension scientists have been selected as Presidential Chairs for Tree Nuts at University of California Agriculture and Natural Resources.

Giulia Marino, UCCE specialist, will be the Presidential Chair for Tree Nut Genetics and Mae Culumber, UCCE nut crops advisor, will be the Presidential Chair for Tree Nut Soil Science and Plant Water Relations, announced Glenda Humiston, UC vice president for agriculture and natural resources.

Giulia Marino

The endowed chairs will give the two scientists a dedicated source of funding for five years for their ongoing agricultural research. UC Agriculture and Natural Resources established the two $1 million endowments in 2015. Half of the funds for the endowed chairs was donated by the California Pistachio Research Board and the other half was provided by UC Office of the President.

Mae Culumber

“The California Pistachio Research Board appreciated the opportunity to create these Presidential Chairs with the dedicated flexible funding it provides the scientists,” said Bob Klein, manager of the California Pistachio Research Board. “Mae and Giulia have stellar research records, have a history of research on California pistachios, and deserved both consideration and the award of these Chairs. The Board was pleased with the previous incumbents and is now looking forward to working with both Giulia and Mae in their programs on Genetics and Soil Science/Water Relations.”

Marino, who joined UC ANR in 2020, is based at UC Kearney Agricultural Research & Extension Center in Parlier. Her research integrates germplasm preservation and evaluation with tree physiology to improve orchard system profitability and abiotic-stress resilience. She explores the interactions between cultivar-rootstock traits, soil conditions and management practices.

“The funding from the presidential chair of tree nuts genetics will allow me to evaluate the horticultural and physiological performance of some promising new scion-rootstock options stemming from the UC pistachio breeding program developed by Craig Kallsen, UCCE farm advisor for Kern County, and Dan Parfitt, UC Davis professor emeritus,” Marino said.

“The program has the objectives of increasing the genetic diversity of the scion and rootstock cultivars used by the pistachio industry to improve grower returns and reduce its susceptibility to climate change,” Marino continued. “Rootstock projects include novel rootstocks more tolerant of boron in irrigation water, dwarfing rootstocks for higher early yields and more efficient use of pruning and harvest inputs. Scion objectives include novel scions for higher yield and trees less sensitive to inadequate winter chilling.”

One of her current research lines focuses on the characterization of low vigor cultivars and/or rootstocks to increase orchard planting density and reduce management costs in olive, pistachio and almond. She develops protocols for irrigation management based on genotype-specific physiological responses to water stress. Marino also studies the impact of saline sodic soil conditions on pistachio physiology and of low winter chill on cherry and pistachio tree and fruit physiology.

Marino earned a doctoral degree in fruit and forestry tree systems and master’s and bachelor’s degrees in agricultural science, all from the University of Palermo in Italy.

Culumber, UCCE nut crops advisor for Fresno and Kings counties, focuses on enhancing the sustainability and viability of nut crop production through applied research and outreach education with emphasis on soil and water conservation and reducing the impact of production practices on air quality and greenhouse gas emissions. Culumber partners with fellow UC advisors, specialists, campus faculty, growers and other industry stakeholders to find practical, sustainable solutions for issues including soil salinity, tree training and pruning, tree nutrition, and pest and disease management.

“As Presidential Chair, I will utilize these generous funds from the Pistachio Research Board to augment my collaborative outreach extension and applied research efforts to understand and develop solutions to soil and water quality problems faced by pistachio growers and other nut crop producers across the San Joaquin Valley,” Culumber said.

She is collaborating on a CDFA Fertilizer Research and Education Program project that provides irrigation and nitrogen management training for certified crop advisors and growers to adopt practices that conserve water and protect water quality. She is also studying how to improve estimates of crop evapotranspiration and forecasting for major California crops for more precise irrigation. Culumber is leading research on the effects of whole orchard recycling on air quality and climate resilience, soil health, tree growth and productivity in second-generation orchards.

Culumber earned a Ph.D. in soil science and agroecology and a master’s in plant science and molecular ecology, both from Utah State University, and a bachelor’s in biology from University of Wisconsin-Stevens Point.

Bruce D. Lampinen, UC Cooperative Extension integrated orchard management, walnut and almond specialist in the UC Davis Department of Plant Sciences, received the first Presidential Chair for Tree Nut Soil Science and Plant Water Relations. Craig Kallsen, UC Cooperative Extension farm advisor in Kern County who specializes in fruit and nut crops, received the Presidential Chair for Tree Nut Genetics.

2022-04-29T13:59:40-07:00April 29th, 2022|

Governor Newsom Signs Executive Order in Response to Western Drought

By Kahn, Soares & Conway, LLP

As California endures the driest first three months of a year in the state’s recorded history, and simultaneously enters a third year of drought, Governor Gavin Newsom signed an Executive Order (Order) to strengthen conservation efforts. According to the Administration’s press release, the Order calls “on local water suppliers to move to Level 2 of their Water Shortage Contingency Plans, which require locally-appropriate actions that will conserve water across all sectors and directing the State Water Resources Control Board to consider a ban on the watering of decorative grass at businesses and institutions.”

The Governor is “encouraging suppliers, where appropriate, to consider going above and beyond the Level 2 of their water shortage contingency plans, activating more ambitious measures [and]… has ordered state agencies to submit funding proposals to support the state’s short- and long-term drought response, including emergency assistance to communities and households facing drought-related water shortages, facilitating groundwater recharge and wastewater recycling, improvements in water use efficiency, protecting fish and wildlife, and minimizing drought-related economic disruption.”

Today’s Order also includes the following provisions:

  • Ensuring Vulnerable Communities Have Drinking Water
  • Cuts red tape so communities that need access to emergency hauled or bottled water can get it immediately.
  • Safeguarding Groundwater Supplies
  • Requires local permitting authorities to coordinate with Groundwater Sustainability Agencies to ensure new proposed wells do not compromise existing wells or infrastructure, as 85 percent of public water systems rely heavily on groundwater during drought.
  • Streamlines permitting for groundwater recharge projects that help to refill aquifers when rains come.
  • Protecting Vulnerable Fish And Wildlife
  • Expedites state agency approvals for necessary actions to protect fish and wildlife where drought conditions threaten their health and survival.
  • Preventing Illegal Water Diversions
  • Directs the Water Board to expand site inspections in order to determine whether illegal diversions are occurring.

For more information on the state’s response to the drought, click here. For any questions, please reach out to Louie Brown at lbrown@kscsacramento.com.

2022-03-29T13:28:27-07:00March 29th, 2022|

Humiston Touts USDA Climate-Smart Programs Before House Agriculture Committee

Testimony highlights UC ANR’s role in advancing prosperity, sustainability and climate resilience

By Pam Kan-Rice, UCANR

Glenda Humiston, Ph.D., University of California vice president of agriculture and natural resources, director of the Agricultural Experiment Station and director of the Cooperative Extension Service, testified before the U.S. House of Representatives Committee on Agriculture at today’s (March 16) hearing “A 2022 Review of the Farm Bill: The Role of USDA Programs in Addressing Climate Change.

A recording of the hearing can be viewed at https://youtu.be/2_GQI6b6CCs. Congressman Jimmy Panetta, who represents California’s Central Coast, introduces Humiston at the 16-minute mark of the recording. She begins speaking at the 40:38 mark.

In Washington, D.C., Humiston delivered the following prepared statement:

Good morning, Chairman [David] Scott, Ranking Member [GT] Thompson, and Members of the Committee, my name is Glenda Humiston, and I serve as the Vice President of Agriculture and Natural Resources (ANR) for the University of California (UC) system. I am honored to have this opportunity to discuss the importance of agricultural research, and other USDA programs, as you begin work on the next Farm Bill.

With UC ANR serving as a vital partner, California continues to be the nation’s top agricultural state. For more than a century, California’s $50 billion agricultural sector has depended on UC ANR, in partnership with our UC campuses, for the stream of new technologies and research breakthroughs needed to stay competitive and be responsible stewards of the land. We are proud to be part of the Land Grant partnership that was developed between states and the federal government with the 1862 Morrill Act, 1887 Hatch Act and the 1914 Smith-Lever Act. That enterprise has, for over 130 years, advanced scientific knowledge in all aspects of food production, and improved production capacity, profitability, and safety of the nation’s food system.

With over 71,000 farms producing 400 different commodities, California is an agricultural behemoth and the sole provider of many high-demand farm products while also exporting roughly a third of its agricultural production each year. Beyond on-farm production, California’s working landscapes include farmland, ranches, forests, wetlands, mines, water bodies and other natural resource lands, both private and public, that are vital sources of ecosystem services. These services are ways that the natural world provides biological necessities, such as clean water, nutritious food, and a livable climate, as well as indirect economic benefits, such as jobs and revenue created along food value chains. More broadly, they encompass intangible goods that contribute to human well-being, such as recreation, aesthetic inspiration, and cultural connection.

Ensuring that those ecosystem services are functioning and remain available to utilize is an ever-growing challenge. There can be no doubt that extreme climate events are changing California’s landscape – fires, floods, drought, more invasive pests are already affecting agriculture. For example, unseasonably warm weather now causes many fruit and nut trees to bloom before the last frost, causing great economic losses. In the coming decades, the changing climate is likely to further decrease the supply of water, increase the risk of wildfires, and threaten coastal development and ecosystems.

To combat such future perils, we must harness the ability of our agricultural and other working landscapes to adapt, to mitigate and where possible, to become a solution to climate change. According to the National Academy of Sciences, U.S. soils and forests have the potential to sequester about 500 million metric tons of carbon dioxide annually. Emerging markets for carbon credits and government incentive programs could generate tens of billions of dollars per year in new investment for working farm and forest lands within the next several years.

Within this framework, USDA programs are critical to our efforts to support carbon sequestration, improved water management, healthy soils, forest restoration, hazardous fuels management, and wood products innovation, among other provisions that support natural climate solutions. USDA’s new Partnerships for Climate-Smart Commodities is a great example of how targeted funding for pilot projects can create market opportunities for commodities produced using climate-smart practices.

As we pursue those climate-smart practices, it is critical that we make full use of existing programs and leverage collaborations among them wherever possible. Supporting partnerships between government agencies with academia and the private sector will enable production of multiple benefits from various actions. As part of this we need to utilize voluntary, market and incentive-based programs to the greatest extent possible and maintain a focus on science-based outcomes. In many situations, transformative innovation is needed – moving beyond just improving existing methods and processes to totally re-thinking how our systems are designed to deliver policy and programs.

UC ANR supports California farmers and ranchers to be resilient to extreme weather events with data-driven tools, methods, and technologies. For example, we are developing drought, heat, and pest-tolerant crop varieties that allow farmers to remain economically viable while also being resilient to extreme weather. Finding new crops suitable for California soils and ecosystems not only improves the productivity of the farm but can have co-benefits such as improving water-holding capacity of the soil, increasing native pollinator habitat, and boosting local economies by increasing value-added products.

We are also pushing our research system to expand collaborative efforts between experts in soil sciences, plant pathology, biochemistry, and other sciences with technology experts in robotics, sensors, artificial intelligence, materials, supply chain logistics, and energy systems to solve today’s complex problems in agriculture. Much like the biomedical revolution, it is the integration of multiple disciplines into a single project that can lead to transformative innovation that improves productivity, food safety, and ecosystem services while also giving rise to new businesses. Great examples of such transdisciplinary research and development include:

  • An initiative to place solar panels over irrigation canals to reduce evaporation of precious irrigation water supplies for farmers while also producing electricity.
  • Implementing healthy soil practices, like cover crops and no-till, to enhance capture of rain and improve groundwater recharge.
  • Programs for farmers to install dairy digesters to convert potentially harmful greenhouse gases into valuable biofuels.

To develop the science, new technologies and better farming practices that are desperately needed, increased funding for agriculture and food-related research and extension is necessary as are new investment in agricultural research facilities. Public funding for agricultural research in the U.S. has declined in real dollars over the past few decades while deferred maintenance of research facilities greatly hampers scientists’ work. Greater investments will help ensure farmers and ranchers have access to the scientifically rigorous tools and information they need to build climate resilience, mitigate environmental impacts, and increase the productivity of their land.

Other exciting opportunities can be found in forest health efforts that convert excessive fuel loads – biomass – into valuable bioproducts while reducing risk from catastrophic wildfires. California’s wildfire crisis continued its destructive march in 2020, each year worse than the one before. Working closely with regional economic development organizations and our California Economic Summit partners, UC ANR is a key partner in developing and implementing recommendations to improve forest health, reduce wildfire risk, incentivize innovation in new and innovative wood products industries and build capacity for manufacturing to enhance forest and environmental health and resilient rural communities. Examples of this work include:

  • Organizing controlled burn associations with local communities and other forest treatment practices such as a software program, Match.Graze, that improves use of grazing.
  • Partnering with the Inland Empire Economic Partnership and the southern California commercial ports to convert biomass into hydrogen and other liquid biofuels to replace diesel in trucks – the largest source of air pollution in that region.
  • Educating homeowners on landscaping, defensible space, and fire-wise plants to improve home-hardening, reduce risk from fire and conserve water.
  • UC Engineering research on materials science is developing new advanced wood products and data to demonstrate the multiple values of construction with such products.
  • Teaming up with community colleges to provide workforce training in forest professions.

The US needs robust funding for wildfire prevention, research, recovery, and extension. Cooperative Extension academics are lead experts in forestry and wildfire research and they provide critical resources to inform strategic fuels management, enhance community wildfire planning, and build community fire adaptation and resiliency. USDA’s Climate Hubs should be expanded so that they can regularly engage stakeholders and prioritize vital research amongst more partners. The U.S. Forest Service’s work on bioproducts is extremely valuable as is their willingness to enter into long-term stewardship agreements with state and local partners.

In California, we are very excited to be working with the Governor and the state legislature to secure a $185 million investment in UC to build new capacity in climate-focused research, innovation, and workforce development. For example, with this funding we would establish Regional Workforce Hubs that will provide on-the-job training opportunities for university and community college students as well as well as leverage the professional learning and career certification infrastructure of the UC Extension programs to offer a portfolio of training opportunities, tools, and resources for college-prep and non-degree seeking individuals.

Just as these programs allow us to implement climate smart agriculture and healthy forests’ initiatives, they also support regional economic development and job creation. Rural Development, the Agricultural Marketing Service and many other USDA programs are important partners as we build climate solutions through more efficient regional food systems, improved supply chains, workforce training, manufacturing of BioPreferred products, and food security initiatives.

If we are to promote resilience and help rural economies better adapt to climate change, we need to harness all programs throughout the U.S. Department of Agriculture. That means having senior USDA leadership coordinating climate issues across the entire agency and robustly serving as USDA’s climate representative at all interagency climate-related meetings. For example, USDA must collaborate with federal entities like the Federal Communications Commission to support improvements to broadband access, which is critical for climate-smart precision technologies and rural economies. Similarly, just as USDA has partnered with the National Science Foundation on research initiatives and jointly funding competitive grants, it needs to build closer partnerships with programs like Commerce’s Economic Development Agency and Treasury’s Community Financial Development Institutions to ensure that access to capital, effective economic development planning and infrastructure investments are targeted appropriately and delivered well.

One important way to help ensure wise distribution of program dollars to give the current definition of “rural” serious examination and re-engineering; as it stands now, far too many communities are improperly denied USDA resources due to the antiquated definitions of rural and metropolitan. Strongly encouraging more cross-agency proposals throughout USDA and enhanced support for public-private partnerships would remove barriers and hurdles for industry and communities alike.

The current mix of federal and state capacity funds is generally leveraged many-fold by federal competitive grants, grants from private industry, and other types of unrestricted gifts and awards to faculty conducting research at the nation’s land-grant universities. Competitive funding processes can elicit new ideas and speed up certain research projects; however, they also encourage a shift from programmatic research towards shorter-term project research. Failure to invest in a well-balanced mix of capacity and competitive funds for food and agriculture research could have very negative consequences for decades to come – consequences that would take significant time to reverse.

It takes at least seven to 15 years of research and development to develop a new crop variety – longer for trees/vines. Deploying and/or adapting new agricultural technologies can be even longer. For example, when UC Davis engineer, Coby Lorenzen, designed a machine to automate the harvest of tomatoes in the 1960s, it also required agronomist, Jack Hanna, to develop a less-delicate variety of tomato that ripened uniformly and could be easily plucked from the plant, essential qualities that made machine harvesting feasible. Federal funding that recognizes these realities as well as improvements in technology transfer and support for commercialization is vital.

Faculty and staff at land-grant universities across the nation recognize that their work takes place on behalf of a greater good, a broader goal, and a common vision that is much bigger than their individual achievements. Members of this House Committee on Agriculture can be confident that every dollar of federal investment authorized by the Farm Bill and expended at land-grant universities is guaranteed to be leveraged further, and to spawn innovation and discovery that will be translated into solutions to improve the lives of U.S. citizens. I thank you for this opportunity to provide testimony.

2022-03-17T10:44:04-07:00March 17th, 2022|

Quality Walnuts Are Grown in California

California Walnut Growers Produce Higher Quality Products

By Patrick Cavanaugh, with the Ag Information Network

Walnuts are grown in many countries around the world but California walnuts really shine when it comes to quality. Pam Graviet is a Senior Marketing Director International for the California Walnut Commission. Graviet said it comes down to those growers and the processors.

“It’s really what the growers do. I mean, they spend so much care in the orchard, and then when it gets to processing there’s all the extra steps that are taken,” said Graviet. “What they do is partially regulated and partially because of their desire to have a superior product. And that’s actually recognized around the world,” noted Graviet.

“You can get a walnut from Moldova, China, Italy or Australia. There are so many countries that produce them but they see the value that our industry delivers and they want our product,” noted Graviet.

But Graviet said the challenge, and it’s a big challenge, is the price that the growers receive.

“Just like almonds, you have a large supply and you have to develop that demand. And over time that happens, but in the meantime, the price will fluctuate depending on what the supply is on any given year,” she said.

2022-03-16T10:46:05-07:00March 16th, 2022|

The Story of Rising Fertilizer Prices

High fertilizer prices in the past year have increased costs for farmers, but for some crops more than others. Multiple potential causes could explain these price increases, stemming from both supply and demand factors. If farmers respond to high prices by using less fertilizer per acre, it will provide an environmental benefit in the form of less nitrogen and phosphorus in streams, rivers, and lakes.

By Aaron Smith, DeLoach Professor of Agricultural Economics in the Department of Agricultural and Resource Economics at UC Davis.

https://s.giannini.ucop.edu/uploads/pub/2022/02/24/v25n3.pdf 

Fertilizer prices approximately doubled between the summer of 2020 and the end of 2021. Prices had been relatively stable in the prior five years at around $500 per ton for phosphate products (phosphorus) and just below $400 per ton for potash (potassium) and urea (nitrogen). In January 2022, phosphate products hit $900 per ton, and potash and urea prices were $800 per ton (see Figure 1).

What caused these price increases, and how much do they matter?

Agricultural Fertilizers

Most fertilizers deliver one or more of the following macronutrients to plants: nitrogen (N), phosphorus (P), or potassium (K).

Nitrogen makes up three-quarters of the air we breathe and is essential in plant growth. However, atmospheric nitrogen needs to be converted to ammonia (NH3) before it is accessible to plants. This conversion process, known as fixation, occurs naturally through bacteria and archaea that live in the soil or in the roots of some plants. Animals also produce ammonia by eating nitrogen-laden plants and excreting manure.

These natural processes typically do not produce enough ammonia for crops to reach their maximum potential. The invention of the Haber-Bosch process in 1909 enabled the production of synthetic ammonia by reacting nitrogen with hydrogen under high heat and pressure. U.S. nitrogen producers use natural gas as an energy source in this process.

Phosphorus helps plants grow by promoting photosynthesis and other functions important for development. Phosphorus fertilizers are typically produced by mining phosphate rock and treating it with sulfuric or phosphoric acid, causing a chemical reaction that converts it to a form that can be absorbed by plants.

Potassium strengthens plants, making them resistant to disease and higher in quality. Potassium fertilizers are created by mining potash from deep underground, similar to table salt. Chemical reactions convert it into a form usable by plants.

It is impossible to apply the exact amount of fertilizer that plants require, and there is a perception that many farmers over-apply fertilizer because they fear yield and profit losses from applying too little. This extra fertilizer is sometimes called “insurance nitrogen.”

Nitrogen and phosphorus that are not taken up by plants often end up in waterways, where they can cause a massive overgrowth of algae, known as an algae bloom. Certain types of algae emit toxins that are absorbed by shellfish. Consuming these tainted shellfish can lead to stomach illness and short-term memory problems. Drinking or coming into contact with toxins from algae blooms can cause stomachaches, rashes, and more serious problems. Algae blooms also reduce the recreational value of lakes and rivers.

U.S. Fertilizer Consumption

Nitrogen fertilizer use increased by a factor of four from 1960–1980, as shown in Figure 2. This increase coincided with dramatic increases in crop yields. In the 1970s, high agricultural commodity prices created a farm boom in which farmers planted more acres to crops and increased fertilizer applications.

After a slight drop during the farm crisis of the early 1980s, nitrogen fertilizer use has increased steadily, but at a slower rate than in the 1960s and 1970s. Phosphate and potash use has been relatively constant since 1985. Use of all fertilizers dropped substantially in 2009 after fertilizer prices increased fivefold during the 2008 commodity boom—a much larger increase than in 2021.

Nitrogen is by far the most used agricultural fertilizer by weight. It now makes up almost 60% of all fertilizer used, whereas phosphate and potash each comprise just over 20%. However, the trends in phosphate and potassium use mirror those in nitrogen, perhaps because many farmers apply multi-nutrient fertilizers.

Two facts provide insight into the role of fertilizer in the U.S. farm economy. First, corn uses about 45% of each fertilizer type, yet it takes up only a quarter of all cropland—90 out of about 390 million cropland acres in the nation. Second, in 2020 fertilizer made up 35% of operating expenses for corn growers—more than any other crop. Fertilizer is a major expense for the biggest crop in the nation, so the 2021 fertilizer price increases will significantly raise the cost of growing it.

As Figure 3 shows, fertilizer makes up more than 25% of operating expenses for several other major crops, including barley, oats, sorghum, and wheat. Between them, these crops use an additional 50 million acres each year.

In percentage terms, fertilizer is a much smaller expense for major California crops than the major national crops. It makes up about 10% of the cost of growing almonds, less than 2% of the cost of growing wine grapes, and 11% of the cost of growing processing tomatoes.

These percentages are useful for understanding the salience of fertilizer price increases for farmers. A jump in the price of one of your largest expense items will be noticed.

However, these percentages obscure the amount of fertilizer used on each crop because major national crops such as corn are relatively inexpensive to grow. Most corn is grown without irrigation, which saves the cost of acquiring and pumping water. Corn also requires little labor, especially now that tractors practically drive themselves.

According to cost and return studies by the University of California, bearing almonds cost $3,000–$4,000 per acre per year, which is about 10 times as much as growing corn in Illinois. So, although they spend a smaller percentage of their budget on fertilizer, California almond growers spend about three times as much per acre on fertilizer as Illinois corn growers, including about 25% more on nitrogen and multiple times more on potassium.

Fertilizer Production 

Fertilizers are produced throughout the world and traded heavily between countries. Figure 4 shows that the United States currently produces about 85% of the ammonia it uses, most of which becomes nitrogen fertilizer, and it produces 90% of the phosphate rock it uses, most of which becomes phosphate fertilizer. It imports 90% of its potash.

Most U.S. ammonia production capacity is in Louisiana, Oklahoma, and Texas—close to natural gas fields. Natural gas constitutes about 80% of the cost of producing ammonia. Domestic production declined substantially from 2000 to 2010, a period when U.S. natural gas prices were historically high. In the latter part of this decade, two major producers merged as part of a period of consolidation in the industry.

After 2010, the deployment of hydraulic fracturing (fracking) increased the supply of natural gas and thereby lowered the cost of production dramatically. Fertilizer prices, however, remained high in this period and U.S. firms enjoyed large margins. In the last five years, production has rebounded, as more plants were built to take advantage of cheap natural gas.

Ammonia imports have mirrored domestic production, increasing as production declined between 2000 and 2010 before declining when production rebounded after 2016. Two-thirds of U.S. imports come from Trinidad and Tobago, and most of the remainder comes from Canada.

U.S. potash production has declined by 80% since 1965. Most of the remaining U.S. production comes from deep mines in southeastern New Mexico. Most potash imports come from Canada, which is the world’s largest producer by a significant margin.

Most domestic phosphate is mined in Florida and North Carolina, although there is also some production in Idaho and Utah. U.S. phosphate production declined steadily from 1980–2019, but phosphate fertilizer use in U.S. agriculture remained relatively constant over this period.

Each year between 1980 and 2019, the  U.S. exported about half its phosphate production, mostly to Canada and Mexico. As production declined, the U.S. maintained domestic consumption by increasing imports, mostly from Morocco, Russia, and Israel. In March 2021, the U.S. International Trade Commission ruled that imports from Morocco and Russia had affected the U.S. producers adversely, and they imposed countervailing tariffs ranging from 9% to 47%.

The U.S. Geological Survey (USGS) is an excellent source for data on mineral commodities, and I use this source for ammonia and potash in Figure 4. For phosphate, USGS reports data on phosphate rock, which is the product that is extracted from mines. Production and consumption of phosphate rock shows an incomplete picture of the phosphate fertilizer market. Each ton of phosphate rock generates about 0.2 tons of fertilizer. The U.S. imports some phosphate rock, mostly from Peru, which domestic firms make into fertilizer. In addition, the U.S. imports a significant amount of phosphate fertilizer. Thus, Figure 4 presents phosphate fertilizer data from FAO rather than phosphate rock data from USGS.

Prices

So, why have prices increased? To answer this question, I consider supply- and demand-side factors.

On the supply side, U.S. natural gas prices doubled between the summer of 2020 and the end of 2021, which significantly raised the cost of nitrogen production. Energy is also a component of phosphate and potash mining costs, but it is much less important in the production of these products than for nitrogen. For this reason, the increasing price of natural gas cannot fully explain the fact that all fertilizers increased in price by a similar percentage.

Weather events also disrupted nitrogen supply, including the freeze in Texas in February 2021 and Hurricane Ida in August 2021. There were also some supply disruptions due to COVID-19. However, these events caused only a temporary reduction in production and so do not explain a sustained price increase. Moreover, these events did not hit phosphate and potash production regions.

Also on the supply side, shipping costs increased dramatically in 2021, especially on shipments from Asia to North America. However, most fertilizer imports to the U.S. come from the Americas and would be less affected by shipping costs.

On the demand side, crop prices are high. Corn, soybean, and wheat prices increased by 60% from the summer of 2020 through the end of 2021. High crop prices incentivize farmers to apply more fertilizer per acre, which would place pressure on fertilizer prices.

The high crop prices did not spur a substantial increase in acreage in 2021, and it is too early to know whether we will see an acreage increase in 2022. However, an increase in demand from farmers planning to expand acreage in response to high crop prices is a plausible factor behind rising fertilizer prices.

Conclusion 

Predicting commodity prices is a fool’s errand. When natural gas and agricultural commodity prices come down, I would expect fertilizer prices to also come down.

When the price of a pound of fertilizer exceeds the expected increase in revenue from spreading it on the field, it is not profitable to use that pound. Fertilizer prices have increased by more than most crop prices, so in 2022 producers have an incentive to apply less fertilizer per acre. If farmers do apply less fertilizer per acre, it will provide an environmental benefit in the form of less nitrogen and phosphorus in streams, rivers, and lakes.

Moreover, to the extent that farmers apply more than the recommended amount of fertilizer as insurance against low yields, reducing use in 2022 provides an opportunity to experiment and to learn how much such insurance is necessary.

 

2022-03-14T16:07:26-07:00March 14th, 2022|

Grape Experts Give Workshops on Drought Preparedness, Red Blotch

By UCANR

Grapevine Drought Preparedness Workshop

Grape growers and other industry members interested in grape production and water management in vineyards are invited to UC Cooperative Extension’s Grapevine Drought Preparedness Workshops.

The workshops will be held in person on Friday, March 4, in San Luis Obispo and Friday, April 1, in Hopland.

Registration is $50 and includes a full day of live instruction from UC Cooperative Extension viticulture and grapevine experts. Lunch will be provided.

For more information and to register, visit https://ucanr.edu/sites/ShortCourse17.

UC Davis Grapevine Red Blotch Disease Symposium

On Wednesday, March 16, UC Cooperative Extension and the UC Davis Department of Viticulture and Enology will host a Grapevine Red Blotch Disease Symposium 9 a.m.-3:30 p.m.

Red blotch disease in grapevines, which can dramatically reduce the value of winegrapes, harms plants by inhibiting photosynthesis in the leaves. Infected vines are unable to conduct water effectively, leaving sugar that is created by photosynthesis stuck in the leaves instead of in the berries.

This event will be presented both in person at the UC Davis Conference Center and livestreamed for those unable to attend in person.

Presentations will cover the role of treehoppers, treatments, mitigation strategies, the impact of the disease on the composition of wine, and more.

Registration is $250 for the in-person symposium at UC Davis and $150 for the livestream. An application for 3.5 CCE units has been submitted to California Department of Pesticide Regulation and is pending approval.

To see the agenda and to register, visit https://wineserver.ucdavis.edu/events/uc-davis-grapevine-red-blotch-disease-symposium.

2022-02-24T09:14:03-08:00February 24th, 2022|

Westlands Water District Statement on Initial CVP Water Allocation

Today the Bureau of Reclamation announced an initial allocation of 0% for Westlands Water District and other south-of-Delta Central Valley Project (CVP) irrigation contractors. This is the fourth time in the last decade the south-of-Delta irrigation contractors have received a 0% allocation. Despite significant precipitation in the fall and early winter, the 2021-22 water year is likely to be classified as dry. January and February were exceptionally dry. The District is disappointed with the allocation but is aware that hydrologic conditions, including low CVP reservoir storage conditions at the beginning of the water year and record low precipitation in January and February, and Reclamation’s obligation to meet Delta water quality and outflow standards imposed by the State Water Resources Control Board, prevent Reclamation from making water available under the District’s contract.

Within Westlands, the continued drought conditions in 2021 resulted in over 200,000 acres fallowed, countless lost jobs, and thousands of acres of food unharvested. The circumstances in 2021 and those facing us in 2022 demonstrate the need invest in infrastructure to better manage the State’s water resources, which includes increased capacity to capture water when its available for transport and use in times of drought. California needs new storage, both surface and groundwater, and improved conveyance facilities. The state must also establish effective water policies that enable adaptive management of the system to maximize the beneficial uses of water throughout the State. Despite the current lack of precipitation, the District is focusing on comprehensive approaches to ensure a sustainable water future.

In spite of the current drought, the District continues to plan, pursue, support, and implement regional and local projects to ensure a sustainable water future for the families that live and work in and around the District. And, as always, the District will look to the coming months with the hope of improved precipitation and an increased allocation.

2022-02-23T12:21:51-08:00February 23rd, 2022|
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