Lemon Economics in Ventura County

Lemons Became More Popular, But then COVID Hit

By Tim Hammerich, with the AgInformation Network

A recent study on the costs and returns of establishing and producing lemons in Ventura County was released by UC Cooperative Extension in Southern California and UC Agricultural Issues Center.

“We grow lemons along the coast because it doesn’t get hot, and we do a really good sour lemon. The trees flower year-round, and so there’s production year-round,” said Ben Faber, a Farm Advisor based in Ventura County.”

He says lemon prices had been stagnant for a long time but started to really rise in the past decade or two with the popularity of restaurant dining.

“And so the consumption just soared. Prices had been around five or six, eight dollars a box, and boy, they went up to $18 – $20 a box. So people saw a lot of money there.

“And so what do you do? You respond to it, and you plant. The market for strawberries had fallen, labor availability diminished. So along the coast here, a lot of people had said, ‘I don’t care. I’m going to risk it. I’m going to plant lemons’. And it doesn’t take a whole lot of labor to do, it takes less water. We’re stressed about water availability along the coast. And so, you know, the choice of lemons sounded really good until…boom…COVID.”

The pandemic has certainly taken its toll on lemon prices. Faber is hopeful they will recover but also concerned about the threat of citrus greening disease.

California Ag Today2021-01-14T18:10:18-08:00January 14th, 2021|

Big Exports Numbers Mean Big Responsibilities for California

California Exported $20 Billion in Food Products in 2016

By Mikenzi Meyers, Associate Editor

It’s no secret that California’s agricultural exports are a huge part of the state’s economy—but to put it in perspective, over $20 billion worth of food and agricultural products were exported in 2016 alone (the latest figures). With numbers like these, people like Glen Roberts of the U.S. Department of Commerce and International Trade Administration are kept busy.

Roberts, who is part of the Global Markets sector and based in Fresno, not only works with what he calls “easy” exports like Mexico and Canada, but other places across the globe, shipping anything and everything from food to machinery.

Glen Roberts

When it comes to his role in California, Roberts explained, “Our office covers from the top of the Grapevine, Kern County, all the way up to Stanislaus County from San Louis Obispo over to Nevada.”

His sector, which handles more of the commercial side of things, acts as a gateway to other government programs that help out with international trade.

Although Roberts’ main focus is commercial, he’s still one of the go-to guys in agriculture exports.

“What happened when the almond prices dropped? I got the calls because Foreign Ag Service doesn’t handle contractual disputes,” he said.

Roberts further added, “I had to help out our local almond growers because the buyers didn’t want to pay the higher contracted price. They wanted to buy the new lower market price.”

California Ag Today2019-03-19T16:41:17-07:00March 19th, 2019|

California Crop Values for 2017 Released by CDFA

Full Statistics Now Available For the Crop Year 2017

News Release

The California Agricultural Statistics Review for crop year 2017 has been released. It reports that California’s farms and ranches received more than $50 billion in cash receipts for their output. This represents an increase of almost 6 percent in crop values compared to 2016.

California’s agricultural abundance includes more than 400 commodities. Over a third of the country’s vegetables and two-thirds of the country’s fruits and nuts are grown in California. California is the leading U.S. state for cash farm receipts, accounting for over 13 percent of the nation’s total agricultural value. The top producing commodities for 2017 include:

Dairy Products, Milk — $6.56 billion

Grapes— $5.79 billion

Almonds— $5.60 billion

Strawberries— $3.10 billion

Cattle and Calves — $2.53 billion

Lettuce— $2.41 billion

Walnuts— $1.59 billion

Tomatoes— $1.05 billion

Pistachios— $1.01 billion

Broilers— $939 million

Complete Report at this Link:

https://www.cdfa.ca.gov/Statistics/PDFs/2017-18AgReport.pdf

California Ag Today2019-01-10T15:52:42-08:00January 10th, 2019|

Almond Alliance Helps Growers with Advocacy

Almond Alliance Lent a Hand on Tariff Relief

By Jessica Theisman, Associate Editor

Like many agricultural sectors, almond growers have also been affected by recent tariff wars. However, almond growers have a true friend in the Modesto-based Almond Alliance.

“We are definitely an advocacy organization, that is the core of what we do,” said Elaine Trevino, president of the Almond Alliance.

Elaine Trevino

“The Almond Alliance educates our legislators, their department officials and cabinet about issues that are important to the almond industry. It is very critical that our elected officials, specifically the urban [ones] that are not familiar with agriculture, understand agriculture. They need to understand … the inputs and the natural resources needed for agriculture, and also understand the best practices that we put into place to be good corporate and small businesses,” Trevino said.

“Obviously with almonds, you have hulls and shells and the biomass that comes with almonds, and so we focus on all aspects of that,” she explained.

Almond growers are being affected by tariffs increases into China. Beginning on April 2nd, the first 232 retaliatory tariffs was seen that affected China. Since then, our turkey has also been affected by the tariffs.

The almond industry exports 67 percent of its production to more than 100 countries.

“Looking at export markets and how they impact the industry is critical. Secretary Purdue came out with the mitigation package,” Trevino said.

The almond industry fought very hard to be included in direct payments. While many say it’s just three cents a pound, the allocation to almonds was $63.3 million.

“It’s our intention that the alliance fight for every penny of that goes back to the growers, and if they are not eligible for the direct payments, then we’ll make sure that they receive it through market promotion that will help move their product and hopefully get those prices back up if they haven’t been affected,” Trevino said.

California Ag Today2018-12-18T15:07:08-08:00December 18th, 2018|

2018 Raisin Price Still in Limbo

Discussions Continue Over Raisin Price

News Release Edited by Patrick Cavanaugh

The Board of Directors of the Fresno-based Raisin Bargaining Association have offered to sell the 2018 Natural Seedless Raisin Crop for $2,250.00 per ton. Also, the board has offered to sell both the 2018 & 2019 crops for $2,150.00 per ton. This 2-year Memorandum of Understanding (M.O.U.) at $2,150.00 per ton has safeguards in it for the second year in case there are changes that could force the raisin price to go higher or lower, with a lower bottom not to fall below $2,000.00 per ton.

Last year, they had 12 signatory packers agree to the M.O.U. negotiated at $1,800.00 per ton. This year, they have been instructed that Sun-Maid has rejected both the $2,250.00 one year contract and the $2,150.00 two year contract. They have also advised the RBA to try and move the 2,000 tons of RBA growers to other packers, which we are in the process of doing.

Of the remaining 11 packers, 6 have agreed to accept the $2,150.00 2-year plan. Those six packers are Central California Packing Company, Chooljian Brothers Packing Company, Inc., Del Rey Packing Company, National Raisin Company, River Ranch Raisins, LLC., and Sun Valley Raisins, Inc.

The 5 remaining packers who have rejected both the one year price at $2,250.00 per ton and the $2,150.00 per ton two-year M.O.U. include: Boghosian Raisin Packing Company, Inc., Caruthers Raisin Packing Company, Inc., Fresno Cooperative Raisin Growers, Inc., Lion Raisins, and Victor Packing Company.

In the discussion with the packers who have not agreed to M.O.U. terms, their arguments were that the $2,250.00 price was too high and the $2,150.00 price was acceptable but not for 2 years. Discussions will continue until Friday, October 12. For updates please go to our website at www.RaisinBargainingAssociation.com and click on the “From the Office” tab.

California Ag Today2018-10-12T16:49:55-07:00October 12th, 2018|

Federal Milk Marketing Order in California in Effect Nov. 1

Questions Arise Regarding Milk Quota

Edited by Patrick Cavanaugh

Dairymen and women throughout California are working hard to provide milk and other dairy products for consumers in California and the world. Because the industry has struggled over the past decade with price swings that have often landed dairies in red, many dairies have gone out of business. Still, other operations relocated to others states where regulations are a fraction of what they are in California.

In June 2018, California dairy producers voted to establish a new Federal Milk Marketing Order (FMMO) for the state. The vote was a paramount step in a long process that would culminate with the new order taking effect on November 1. The order will adopt the same dairy product classification and pricing provisions currently used throughout the FMMO system.

California accounts for more than 18 percent of U.S. milk production and is currently regulated by a state milk marketing order administered by the California Department of Agriculture (CDFA). Once this new FMMO takes effect, more than 80 percent of the U.S. milk supply will fall under the FMMO regulatory framework.

Western United Dairymen is a trade association based in Modesto. Annie AcMoody is the Director of Economic Analysis. She explained that there have been questions from the industry regarding the upcoming FMMO.

Among the often asked question revolves around when the state switches to FMMO in November, what will happen to their quota if a dairy ships milk out of state?

Annie AcMoody: When our California state system goes away to make way for the Federal Milk Marketing Order (FMMO) in November, the Quota Implementation Plan (QIP) will be the language in place to ensure the quota system’s smooth transition into the FMMO system.

When we enter that new world, all market milk received from California producers at a California plant will be assessed for quota. By “received”, the language defines “to convey milk physically into a milk plant where it is utilized within the plant, or stored within such milk plant and transferred to another plant for utilization.” This means that a milk truck driver cannot drive by a plant, wave hello to an operator, and keep on going out of state and still call this milk received in California. Basically, if your California milk leaves the state, you will not be assessed for quota.

But you also will not be paid for it. But, if your milk is 60% quota and only 40% of your milk goes out of state, you will be assessed on 60% of your milk and get paid quota on that same 60%. If your quota covers 100% of your milk and 40% of your milk goes out of state you will be assessed on 60% of your milk and get paid quota on that same 60%. In this instance, one could wonder if it makes much sense to keep your quota.

While it may not make much economic sense to hold on to quota you are not paid for, some reasons may validate that decision (perhaps it is expected milk will be shipped to a California plant in the near future). If you were to decide to hold on to that quota, it is important to keep in mind that “if quota is not made active by shipments of market milk to a California plant or cooperative association or is not transferred within the 60-day period, such quota shall revert to the Department”.

This excerpt from the QIP means that if your quota milk is not paid on for over 60 days, you will lose it, so you better sell it. This is likely going to be an issue if you ship to a proprietary plant and all your milk goes out of state. If you ship milk to a cooperative, there is more flexibility because that coop has the ability to combine quotas assigned to it by its members.

So as long as the quota total within the coop is not larger than the total amount of market milk produced and received in California, then there should be no issue for you as a quota holder.

What  is  defined  as  market  milk? 

Answer:  Grade A milk.

If your milk is Grade B, you cannot have quota now and will not be able to under the QIP. You will not be assessed for it either. Currently, only around 3% of the milk in California is Grade B. WUD will keep an eye out on this topic to ensure that percentage does not deviate significantly. As a reassurance, this is not something that could grow from 3% to 50% in a month since fluid milk is not allowed to take in Grade B milk and the three largest coops in the state (CDI, DFA and LOL) committed to not taking in any more Grade B milk after the transition to the FMMO.

California Ag Today2021-05-12T11:17:09-07:00September 23rd, 2018|

2017 Tulare County Crop Report Tops $7 Billion

Tulare Crop Report Shows 10 Percent Growth in Single Year

By Patrick Cavanaugh, Editor

Big numbers announced today from Tulare County Ag Commissioner Marilyn Wright on the 2017 crop year.

“Our value is 10.5 percent up from last year, at 7,039,929,000. So, that’s 669 million more than the previous year,” Wright said.

Marilyn Kinoshita, Tulare County Ag Commissioner

Marilyn Wright, Tulare County Ag Commissioner

And, of course, more water in the system probably helped, as it did in Fresno County, which announced $7.028 billion in its 2017 Crop Report, released earlier this month.

The dairy industry, which is prominent in Tulare County, came in number one again, representing 25 percent of the total value.

“Milk prices were stronger in early 2017, but they went down later in the year. And they continue to go down, but still it was a big part of the Tulare County ag receipts in 2017,” Wright said.

Following dairy were grape products—including juice grapes, raisins, and table grapes. Table grapes had a stellar year.

Navel and Valencia oranges were next. Cattle and calves ranked fourth, down from category number three in 2016, because cattle prices were off last year.

Tangerines, also known as mandarins, were number five, followed by almonds, cling peaches, and freestone peaches.

Lemons, were ninth on the crop list.

“We only have just over 10,000 acres of lemons in the County,” Wright said.

Wright said the value of this year’s crop report, $7.39 billion, is the third highest value Tulare County has ever reported.

California Ag Today2018-09-18T16:39:21-07:00September 18th, 2018|

Lessening Negative Feelings Over Trade War

Walnut Processors Maintain Optimism

By Patrick Cavanaugh, Editor

California Ag Today recently spoke with Paul Wenger, past president of the California Farm Bureau Federation. He farms 700 acres of almonds and walnuts in Stanislaus County. He said that California Farmers and other stakeholders of the industry need to be less negative about the current trade war with China.

Almond and Walnut Grower Paul Wenger

“The more we talk negatively, the more that negative things are going to happen,” he said. “As I talked to walnut processors. They’re optimistic. That’s good news. I’ve talked to some walnut processors and said, ‘Well, what’s going to happen this year?’ We shouldn’t expect much as far as prices.”

“Marketing is always a self-fulfilling prophecy and it’s more psychology than it is anything,” Wenger said. “We are one of the largest producers now. Certainly, China is the largest producer. But China had a terrible crop and so they need walnuts, and so strange things can happen and the Chinese are always one that can bend the rules when they need.”

“We know that’s why President Trump has been going after China supposedly over some of these intellectual properties. Certainly, those aren’t the things that hurt agriculture, but we in agriculture are paying the price as we look at these countervailing tariffs that are coming on,” Wenger said.

Wenger explained that the Chinese know that, throughout the Midwest, it was the farm vote that helped and the rural states that helped bring home a victory for the president, so they’re going to go after President Trump.

A large amount of product was sold last season at a low price.

“We just go through the Affordable Care Act and then the port slowdown on the 2015 crop, which went into the 2016 crop, which was a little better We got a little bit better than 2017 crop was a good year for us,” Wenger said. ‘So you’re looking at a pretty good ’18 and now this happens.”

California Ag Today2018-09-04T13:42:28-07:00September 4th, 2018|

Sharing Secrets to a Successful Bowl of Cherries

Weather and Pruning Make Life a Bowl of Cherries

By Laurie Greene, Founding Editor

Clark Goehring, a third generation Kern County farmer, produces cherries and almonds. He summarized his cherry harvested as “good compared to the other years when we have had rain. Some people in our area still had rain during harvest, but we were able to harvest and bring our cherries to market in good condition.”

“Of course, it rained a lot this winter and spring, but you do not want rain when cherries are maturing on the tree; they don’t like rain.”

Goehring explained that when it rains beyond the point when cherries start coloring, they split, making them unmarketable. “But while it may take some rained-on cherries off the market, the price of the marketable fruit goes up,” he said, benefiting those growers who had a quality crop, like him.

Goehring’s farm workers train the cherry trees to keep them low—approximately 8 feet tall. “We have tried to have them bush out instead of being more of a central leader. Actually, it’s called Spanish Bush style or, in modified form, KGB.”

Kym Green Bush designed the KGB training method in Australia to use multiple leaders and have them fruit on the leaders themselves. KGB simplifies pruning so less experienced farm workers can learn the skill more easily. The trees are replenished every five years.

Goehring said the method saves money on the farm, cuts labor and increases workers’ safety because it requires no ladders and the harvest is quicker. Harvesting without ladders also gives Goehring an advantage of attracting farm labor over other orchards that require ladders.

“In California, if farm workers have their choice of picking your cherries without using ladders, which is usually piecework, or someone else’s crop with ladders, they are going to want to come to you,” he explained.

California Ag Today2017-08-02T16:14:04-07:00August 2nd, 2017|

New Estimates on Broccoli and Lettuce Production Costs

Broccoli and Lettuce Production Cost Studies Released by UC ANR

News Release

New studies with sample costs to produce and harvest iceberg lettuce and broccoli for fresh market in the Monterey, Santa Cruz and San Benito counties have been released by UC ANR Agricultural Issues Center and UC Cooperative Extension. Vegetable growers may find these useful for estimating their own production costs and potential returns on investment.

“These studies have an expanded section on labor, which includes information on California’s new minimum wage and overtime laws,” said Laura Tourte, UC Cooperative Extension farm management advisor in Santa Cruz, Monterey and San Benito counties, who co-authored the study.

The analysis is based on a hypothetical well-managed farming operation using practices common to the Central Coast Region. The costs, materials and practices shown in this study will not apply to all farms. Growers, UC ANR Cooperative Extension farm advisors and other agricultural associates provided input and reviewed the methods and findings of the study.

Both studies assume a farm operation of 1,500 non-contiguous acres of rented land. The hypothetical iceberg-lettuce farm has 250 acres planted to iceberg lettuce. The lettuce is hand-harvested into 42-pound cartons containing 24 film-wrapped heads. The hypothetical broccoli farm has 500 acres planted to broccoli. The broccoli is hand-harvested into 21-pound bunch cartons. On each farm, the remaining acreage is assumed to be planted to other cool season vegetable crops.

The authors describe the assumptions used to identify current costs for production material inputs, cash and non-cash overhead. Ranging analysis tables show net profits over a range of prices and yields. Other tables show the monthly cash costs, the costs and returns per acre, hourly equipment costs, and the whole farm annual equipment, investment and business overhead costs.

Free copies of “Sample Costs to Produce and Harvest Iceberg Lettuce in the Central Coast – 2017” and “Sample Costs to Produce and Harvest Broccoli in the Central Coast – 2017” and other sample cost of production studies for many commodities are available. To download the cost studies, visit the UC Davis Department of Agricultural and Resource Economics website at https://coststudies.ucdavis.edu.

The cost and returns studies program is funded by the UC Agricultural Issues Center and UC Cooperative Extension, both of which are part of the UC Division of Agriculture and Natural Resources, and the UC Davis Department of Agricultural and Resource Economics.

For additional information or an explanation of the calculations used in the studies, contact Jeremy Murdock of the Agricultural Issues Center University at (530) 752-4651, Richard Smith, UC Cooperative Extension advisor in Monterey County, at (831) 759-7357 or Tourte at (831) 763-8005.

Patrick Cavanaugh2017-06-08T14:59:43-07:00June 8th, 2017|