International Trade Tariffs Must Be Lowered

For California Ag Especially, International Trade Tariffs Must Be Lowered

By Laurie Greene, Editor, CaliforniaAgToday.com

USDA Foreign Agriculture Service Associate Administrator Janet Nuzum recently met with agricultural commodity representatives at the California Center for International Trade Development (CITD) in Fresno.

Nuzum spoke about both the opportunities California agricultural groups face as well as key problems they encounter in international trade. She said, “The strength of California agriculture can sometimes appear to be its weakness, in this sense: California is, of course, the largest agricultural state in the United States. It’s also incredibly diverse compared to other parts of the United States. And, because of that diversity, it faces a wider variety of challenges and problems in global trading.

“If there were less diversity, there might be fewer problems,” said Nuzum. “But, with greater presence in the marketplace, having a wider diversity of products or types of products, and whether their product is fresh or processed, California growers and exporters and government officials and regulators face a very challenging set of circumstances, particularly with international trade tariffs.”

Nuzum said that is both the good news and challenging news—all in one. “You’ve got a rich agricultural economy,” she elaborated, and you’ve got a lot of natural resources which are not necessarily found in other parts of the United States. This enables the industry to offer a very rich plate of different kinds of agricultural products. There are some products, and I am thinking about tree nuts now, in which California represents the majority of world production or world trade. So, other consumers around the world are dependent on having that American product, that Californian product, out there in the marketplace,” she said.

Nuzum said because California’s diverse produce is exported around the world, international trade discussions need to come to fruition to lower foreign trade barriers. “Our tariffs, both agricultural and non-agricultural, are much lower than other countries we trade with. That is one reason it is so important to negotiate these trade agreements—to reduce these other tariffs to zero, or at least to our levels,” she said.

(Photo credit: The Busy Port of Oakland, Flickr)

Patrick Cavanaugh2016-05-31T19:28:15-07:00June 2nd, 2015|

A Call for Common Sense Water Management

California Water Management Dilemma

By Lawrence H. Easterling, Jr.

Larry Easterling makes a comment at a recent pistachio growers meeting.

We are witnessing the dismantling of the California water conveyance system that supplies drinking water for 25 million California residents and four million acres of prime farmland in the San Joaquin Valley.

Our water resources are being “Withheld” from the very people of this state who have shown what “Free Enterprise” can do not only for the well-being of all in California, but the entire nation. Unfortunately, several major environmental groups and complacent politicians are killing the freedoms that have been the bulwark of success in California. Let me explain.

Water is our most valuable renewable resource and Mother Nature gives it to California in copious amounts during most years. What we do with that water—water management—is critical to the future of the Golden State.

On average, 200.0 million acre-feet of water a year blankets our state. One acre-foot is equal to 325,851 gallons of water. Of that precipitation, 75% originates north of the Sacramento River. The other 25% falls in central and southern California.

The water that is not manageable by us is 120.0 million acre-feet. Some of it evaporates, but most of it settles into the ground, fills lakes, and what remains heads for the Pacific Ocean. The balance of the water is called “directable” surface water (80,000,000 acre-feet) and this is where we have the opportunity to put it to its best and proper use.

By 2005, according to the Department of Water Resources, 48% of that directable water went to the environment, 41% to agriculture and the remaining 11% to rural areas. This balance of such a precious resource seemed at the time to be equitable to all parties, thanks to the ingenuity of our forefathers in the 20^th century. Their foresight gave us a water conveyance system second to none in the entire world.

California’s water conveyance system had four major objectives:

To provide reliable water deliveries to 25 million people to avoid water shortages that would otherwise exist and continually plague two-thirds of the California population.
To support four million acres in central California of what the National Geographic Magazine proclaimed to be the most productive farmland in the world.
To reinforce our natural environment.
To recharge our groundwater supplies.

Some distinctions should be made here as to how much directable water we are actually concerned about. At full capacity, the two California water conveyance systems—the State Water Project (SWP) and the federal Central Valley Project (CVP)—deliver water from northern California to southern and central California. Each system, the CVP and the SWP, has the capacity to each deliver 4.0 million acre-feet water each year. However, this water delivery capacity has never been tested. The record shows that in the years prior to 2005, the average total delivery COMBINED for both projects was 5.4 million acre-feet per year. The ultimate users of this water went to agriculture (60%) and the rural population (40%).

The volume of water available, on average, from the Sacramento River, including the San Joaquin River, is 30.3 million acre-feet. It is from this volume of water that the 5.4 million acre-feet are sent south.

In 2007, several environmental organizations led by Natural Resources Defense Council took the Department of Water Resources to court to compel the court to enforce the Endangered Species Act (ESA). The court ruling to enforce this law declared that the giant water export pumps that raise the water from the Delta into the California Aqueduct were cut back because it was suspect that the pumps were killing too many delta smelt, an endangered species.

Even in flood years restricted pumping has reduced the water flow to a fraction of the contracted normal flow. Henceforth, since 2007, our water deliveries to urban and agricultural areas have been severely compromised.

The enforcement of these laws is now negating the four major functions of the giant California water conveyance system outlined with the possible exception of the natural environment. Now mind you, this water comes from northern California where 75% of the rain in California falls, averaging over 50 inches a year. Central and southern California “average” less than 15 inches a year.

During the seven years from 2007 through 2014, average deliveries to farms have been reduced to less than one acre-foot per year. Most agricultural crops require 3 ½ acre-feet of water per year. Today, without recourse, these farms are left with barely enough water to keep their plants alive. As for the hardship visited upon 25 million consumers, the Metropolitan Water District (MWD) in southern California is a good example.

The MWD services 19 million accounts, and prior to 2007, was receiving 40% of its water from the SWP. That water source has now only been able to supply approximately 10% of their needs. Consequently, due to seeking other sources to replace their water losses, rate increases to their customers over the years 2007 to 2014 have doubled. On top of all these setbacks, Mother Nature now has shown us her own drought versus our manufactured water crisis. All the way through this synthetic drought, the average rate of precipitation at the source of our water in northern California has been 45 inches each year.

In order to survive, those of us who must have an adequate supply of water to sustain us have been forced to pump more groundwater and/or purchase water from farmers who idle farmland and transfer their water to areas severely threatened with water shortages. For some of those lucky enough to find water for sale, the cost of water has become a severe financial burden. Where farms in the Central Valley were, prior to 2007, paying just under $100 per acre-foot, today if a willing seller can be found, the price can range anywhere from $1,000 to over $2,000 per acre-foot. In many such cases, water costs can exceed all other cultural costs combined. Likewise, the aquifer has dropped every year since 2007 due to frantic attempts by farmers to supplement the critical loss of surface water.

WHAT MUST BE DONE:

The effects of water deprivation over an eight-year period by a man-made drought capped by one of nature’s real droughts, is wrecking havoc with the nation’s food supply. The state of California is now in the grips of the Law of Diminishing Returns and is incapable of averting a disaster due to environmental regulations. Consequently, this country’s NATIONAL SECURITY is being compromised. CONGRESS MUST ACT NOW before further damage is done. These actions need to be taken:

1. The Endangered Species Act (ESA) must be excluded from jurisdiction over the pumps, which move northern water to central and southern California. The pumps are presently operating at about 15% of their capacity. This measure should be permanent and under the management of the Department of Water Resources (DWR).

2. The Endangered Species Act needs to be revised in order to “protect all species”, including humans, from collateral damage due to methods employed to save one species that results in severe damage to other species. This would be implemented through a biological opinion that would INCLUDE a list of all species that would be adversely affected by the METHOD employed to protect one specific species. This measure would make right just one of the irregularities in this flawed law, which attracts litigation like bees to honey. The law does not need to be struck down, simply rewritten to safeguard “all” species, including human beings.

3. California’s magnificent water distribution and conveyance system has no peer in this world. It is a remarkable feat of engineering admired by those who have come from far and near to marvel at its accomplishment. Yet, by environmental fiat, it has been reduced to a token of its capabilities. “Directable” water in California originally ceded one-third of its 80,000,000 acre-feet to the environment.

Today, according to the DWR, the environment now takes, not one-third, but 50% of the direct able water, leaving the rest to urban and farming communities. This is not what the original framers envisioned, but under the DWR, its control has been gradually diluted by federal agencies such as the Environmental Protection Agency (EPA), and one of its extensions known as the STATE WATER RESOURCES CONTROL BOARD (SWRCB). THIS FIVE PERSON-BOARD IS STAFFED WITH ENVIRONMENTALISTS, such as their chairwoman, Felicia Marcos, a Governor Brown-appointee, whose professional background includes eight years with the EPA and five years with the radical Natural Resources Defense Council.

The influence of these federal agencies, backed by political power brokers’ lobbyists, has tilted the water distribution of surface water away from its original intended users. In essence, the environmentalists now control California’s surface water; and now, with the passage of the recent 7.5 billion dollar Water Bond, they will control our groundwater as well. If the water agencies do not perform with the desired results, the bottom-line is that final control will go to the SWRCB.

The ship of state now needs to be righted; it is drifting far off course. First of all, the EPA must be brought to heel. For a federal agency, it exerts far too much power. And, in so doing, has completely distorted California’s surface water delivery system. Next, the SWRCB must either be eliminated with FULL CONTROL restored to the Department of Water Resources, or completely reorganized as an ADVISORY BOARD to the DWR where ALL recipients of the surface water system would be represented. A ten-board membership might be in order, with a director and the nine remaining seats divided into three equal parts by experienced personnel in agriculture, city water management, and the environment, i.e., three persons from each classification and residents of northern, central and southern California.

4. Finally, one in every ten workers in California is either directly, or indirectly dependent upon the health of our vast agricultural industry.

It is time to step forward and reveal, with facts and figures, the house of cards that water management in this state has become. Likewise, those 25 million people in southern California, such as the MWD’s 19 million users who once got 40% of their water from the giant conveyance system, deserve to get that water back.

With years of a man-made drought compounded by a natural drought now in the eighth year, there is ample information available through various farm county records to quantify in lost dollars the cumulative effect of, (1) lost production due to forced fallowing of land, (2) water costs that are now ten times what they were prior to 2007, and (3) the heavy burden economically of converting hardworking farm labor to the welfare roles where some Central Valley towns are now approaching 50% unemployment. Combined, these costs will be in the billions of dollars, bloating further our California deficit.

The goal of society has always been to improve the human condition and for one generation to leave a better world for the next. The visionaries of the 20^th century got it right. They delivered in spades to us, the beneficiaries, a modern miracle. It is a water conveyance system like none other to serve all the people of California. Where are those visionaries now? Rather than embrace the gifts of a reliable source of precious water, they proceed to dismantle the entire system. It is because of the system that California feeds the nation. This is not just a California crisis. It is one that will affect the entire nation. Look upon it as a national security threat and demand that our leaders do what is right for the vast majority of this country’s people.

Lawrence H. Easterling, Jr. Administrator, Kettleman Pistachio Growers and Director, American Pistachio Growers

Patrick Cavanaugh2016-08-03T21:05:15-07:00May 18th, 2015|

2014 Zante Currant Raisin Price Established

The Raisin Bargaining Association (RBA) has announced the establishment of the 2014 Zante Currant raisin price of $1,900 per ton ($ .95 per pound) based on the following formula:

The RBA 2014 Zante Currant raisin price announcement is identical to last year. The formula has been adjusted by increasing the transportation expense from $7 last year to $15 per ton which better reflects the actual cost.

Greece is the largest producer of Zante Currants in the world and has an above average crop, which results in an abundant supply of Zante Currant raisins in the world.

California sales of Zante Currant raisins was strong this past year, but the world supply situation is challenging the industry’s ability to maintain export movement. Issues with the West Coast dock slowdown have already impacted several key months of shipments. California Raisin growers continue to produce the highest quality and safest Zante Currants in the world and will need to see this price increase in the future to justify continued production.

For further information, contact Glen Goto, CEO, RBA at (559) 221-1925 and www.raisinbargaining.org.

Patrick Cavanaugh2016-05-31T19:30:26-07:00March 16th, 2015|

California Exports: The Future of the Agriculture Industry

In 2013, California’s agriculture exports totaled to approximately $19.5 billion dollars. Those exports not only helped to boost farm prices and income, it also supported the existence of approximately 147,700 jobs both on and off the farm.

“Every one billion dollars in agricultural exports generates another 1.2 dollars in economic activity outside the agriculture sector,” said USDA Foreign Agriculture Service Associate Administrator Janet Nuzum. “When we help promote agricultural exports – it’s not just agriculture that benefits.”

According the USDA, U.S. agriculture producers rely heavily on foreign markets to sell their products. Approximately 70% of nuts, 75% of cotton and 40% of grapes are exported internationally, and California agriculture greatly contributes to those statistics.

Ninety-five percent of the world’s food consumers live outside of the United States, and only 1% of U.S. companies actually export.

“Export opportunities for those involved with agriculture are immense,” said California Center for International Trade Development Director Alicia Rios. “Most growers don’t realize that there are many programs out there to help them learn about the industry and can help them to market their product to international food buyers.”

At an Agricultural Trade Roundtable event, Nuzum met with and discussed the implications of international trade with key agribusiness representatives from California’s Central Valley. Nuzum noted that American producers actually benefit from trade agreements. The goal is to have them eliminate foreign tarrifs, unscientific regulatory barriers and bureaucratic administrative procedures that are designed to block trade.

With the world’s population growing, and with income fluctuations in developing countries, there are many opportunities for the U.S. ag industry to market its products.

“2015 is going to be a key year in setting the stage on the future conditions that the U.S. agriculture industry will face,” said Nuzum. “If we don’t take advantage of international opportunities, somebody else will.”

For more information about export programs, click on the links below.

http://www.fas.usda.gov

http://fresnocitd.org

Patrick Cavanaugh2016-05-31T19:30:28-07:00March 4th, 2015|

After Tough Negotiation, Raisin Price Decided

Raisin Price Set At $1650 Per Ton

More Thompson Seedless Vineyards To Be Pushed

The Raisin Bargaining Association (RBA) announced that it has reached agreement with its signatory packers on the 2013-14 Natural Seedless raisin harvest announced field price. The price will be one thousand six hundred fifty dollars ($1,650.00) per ton or eighty-two and one half cents ($0.825) per pound. The price is calculated using the following formula:

Base price $1,457.00 $0.7285

Moisture @ 10% 80.00 .04

Maturity @ 75% 50.00 .025

Container rental 21.00 .0105

Transportation (minimum) 15.00 .0075

RAC assessment 14.00 .007

USDA inspection 13.00 .0065

2013 Announced RBA field price $1,650.00 per ton $0.825 per lb.

Raisin growers have sent a strong message to the industry that they prefer selling raisins on a 100% basis now and into the future. With that in mind, the Board of Directors of the Association worked diligently toward a compromise with their signatory packers to establish a fair price that reflects the additional California raisin production for this season.

The Raisin Administrative Committee (RAC) recently estimated the 2013 Natural Seedless raisin crop at 348,437 tons in comparison to deliveries of 311,090 tons last year. The $1,650 per ton price for the 2013 Natural Seedless raisin crop is a 13% reduction to last year but takes into account the additional crop that is estimated for production as well as the challenging market conditions that the industry will be facing.

The agreement calls for growers to be paid in three installments this year as opposed to four installments last season. 65% of the payment will be due fifteen (15) days after completion of delivery, 20% will be due to growers on or before February 28, 2014, and the final 15% will be payable on or before April 30, 2014.

In the past, grower reserve raisins generated funds to assist the industry in marketing additional production into world markets. The effort to sell this year’s additional production without reserve programs and the temporary elimination of state marketing and promotion funding are two reasons why the RAC assessment of fourteen dollars ($14) per ton has been included in the pricing formula. This will provide an opportunity for the industry to work together through the RAC in support of efforts to market 100% of each year’s crop without reserves.

As reported from the International Dried Grape Producing Countries Conference in October, there continue to be strong indicators that Turkey has a significantly smaller dried grape crop to market this coming season. California and Turkey are the two largest producers of dried grapes in the world. It was also reported that South Africa, Chile, and Argentina have suffered tremendous frost damage in their vineyards, which will severely limit their harvest, which begins in January. The ability to take full advantage of what appears to be a tremendous sales opportunity requires an announced field price.

The Raisin Bargaining Association Board of Directors understood the importance of establishing this important benchmark in a timely manner to sell the maximum amount of raisins this year. However, they are also well aware of the impact it has on the grower community. Labor, water, and energy costs have significantly increased for growers over the past twelve months further squeezing their bottom line margins. As agricultural resources in California are depleted, vineyard owners will continue to seek the best utilization of their land.

California Ag Today editors spoke with Steven Spate, an RBA Grower representative, and a raisin grower. He said: “We are witnessing a large amount of raisin grape vineyards being removed (between 8,000 and 15,000 acres) from production this year in favor of more mechanized and profitable crops such as almonds, walnuts, and citrus.”

“Time will tell what impact this acreage reduction will have on the future of the California raisin industry but taking the necessary steps to market this year’s crop was extremely important for the Raisin Bargaining Association to accomplish. We are now counting on the California raisin packers to sell this crop to provide a better future for the remaining growers in our industry,” Spate said.

Spate added that processors thought the price should have been lower, but growers generally thought that shortages in Turkey and other areas should have boosted the price. “But still, there are excess raisins on the market and it has created a downswing in price.

Growers who are pushing out vineyards say that the lower price is only one factor that is in play. Chronic labor shortages are also encouraging growers to plant a less labor-intensive crop.

Patrick Cavanaugh2016-08-25T21:49:44-07:00November 26th, 2013|

Record Crowd of Tree Nut Growers in Turlock

Big Crowd in Turlock for Tree Nut and Vine Expo

More than 800 growers and PCAs were at the Stanislaus County Fairgrounds TODAY, to hear from many speakers, visit with hundreds of exhibitors, talk about tree nuts and grape vines, and enjoy breakfast and a barbeque Tri-Tip lunch.

“It was the 18thannual event and with a record crowd. All growers were upbeat following a good harvest and good nut prices. Also, both domestic and export sales are increasing,” said Patrick Cavanaugh, editor of Pacific Nut Producer magazine and co-host of the event.

Exhibitors speak with tree nut growers about products and services

“We are pleased that both the nut and grape industry are doing well in California. All we really need is a lot of rainfall this winter,” said Dan Malcolm, publisher of Pacific Nut Producer as well as American Vineyard magazine, and co-host of the show.

Crowd gathers outside to look over equipment.

Speakers came from UC Davis, Stanislaus County Ag Commissioner’s office, UC Cooperative Extension, Almond Board of California, California Walnut Board, Stanislaus County Farm Bureau, and CalAgSafety.

“We appreciate the support of the event sponsors and the record number exhibitors,” said Cavanaugh.

Ryan Genzoli with Cal Ag Safety speaks.

Sponsors Included:

Agromillora
American Ag Credit
Big Tree Organics
California Walnut Board
Compass Minerals
Dave Wilson Nursery
Diamond Foods
Fresno State Viticulture and Enology Dept.
JKB Energy
Novozymes
Principal Financial Group
Yosemite Farm Credit

Patrick Cavanaugh2021-05-12T11:06:02-07:00November 13th, 2013|

32ND AGRIBUSINESS CONFERENCE

Economy, Water, Trade and Labor were Big Topics at 32nd Agribusiness Conference

By Patrick Cavanaugh, Editor

The reality of the 2014 Federal water allocation, new trade agreements, and the prospects of immigration reform were some of the topics discussed at the 32^ndAgribusiness Management Conference, held at the Radisson Hotel and Conference Center in Fresno, and hosted by Mechel Paggi, Director of California State University Center for Agricultural Business.

California State University, Fresno (CSUF) President Joseph Castro

California State University, Fresno (CSUF) President Joseph Castro, the first CSUF president native to the Central Valley and close to agriculture, opened the conference. “I’m happy that our Jordon College of Agricultural Sciences and Technology has had such a tremendous impact in helping to provide a well-educated work force to serve the many facets of the agricultural industry in the valley and beyond.

“One of my highest priorities as president is to further strengthen our agricultural programs in the broadest sense. In the next week, I will formerly establish a presidential commission on the future of agriculture at Fresno State. The commission will include leaders from the campus and industry coming together to assess our programs and to think about what the needs are now and in the future,” Castro said. “I want these leaders to make recommendations on how to further strengthen our agriculture program.

Following Castro, Terry Barr, Chief Economist, CoBank, presented an economic outlook. He noted that economic decisions are not being made fast enough, because the economy is about the same as it was a year ago. “There are still many issues that are unresolved,” he said, adding, “If you don’t make decisions then you don’t move forward.”

Terry Barr, chief economist, CoBank

“We have been through a very dynamic period over the last 10 years. In the first half of that 10 year period, everyone was talking about the rising middle class in China and India and what it was doing for agricultural product demand,” said Carr. “From 2004 to 2008, we had the best of all possible worlds with strong economic growth and growth in the middle class. That was an extremely strong time for agricultural exports. In late 2008, we experienced different economic turmoil and global recession; however, agriculture was pretty well insulated,” Carr added.

“Today, demand for agricultural products remains very strong, mainly due to global shortfalls of some commodities and, of course, growth in China. Going forward in the next five years, we expect a period of continued turmoil, requiring policy changes to realign management, including budget deficits,” noted Carr.

“China is still going to be important but there will be some major geopolitical realignments globally. We are not going to see rapid growth with solid demand. As we go forward, agriculture will probably have to find the new normal,” he said.

“In the US, there is a lot of policy inaction, and there is no long term strategy to reduce the debt. The US dollar is important to agriculture in terms of our competiveness on a global basis,” Carr explained. “From 2002 to 2011, the US dollar fell in value by 38 percent, and our global competitiveness was extremely strong during that time. But we have to believe that the dollar is going to get stronger, not weaker, against most other currencies, with the exception of China.”

Carr noted that China is really driving the global economy at this point in time and what happens there has extraordinary influence on Ag pricing in the future. “They have a lot of room for stimulus, and they have $3 trillion in reserves that they are deploying both domestic and globally,” he said.

“Brazil, Russia and India are emerging markets, which have slowed since the 2004-2008 experience. However, those economies are now in a more normal growth path,” Carr said.

Paggi then spoke about two trade agreements that are on currently in the forefront, the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP).

Mechel Paggi, director of California State University Center for Agricultural Business

“Basically every commodity we work with in California, particularly from the Central Valley, has a huge stake in the export market,” said Paggi. “We produce about $44 billion worth of product and 38 percent of it moves into international trade. It’s tremendously important to us,” said Paggi.

“TTP and TTIP are the two most important preferential trade agreements to be negotiated since NAFTA,” he noted.

“Our TPP partners encompass a market of nearly 500 million consumers with a combined GDP of nearly $12 trillion,” Paggi said. Partner countries include Canada, Australia, Mexico, Malaysia, Singapore, Chile, Peru, New Zealand, Vietnam, Brunei and Japan.

“The TTIP with the EU spans 28 countries with more than 500 million consumers and a GDP of $16.5 trillion,” said Paggi.

“These agreements would give us more marketing opportunities, which at the present time are less than completely open to us, so the benefits would have tremendous potential for us,” Paggi explained.

Paggi said that there is tremendous debate on these potential agreements within the U.S. Also, farmers in the foreign countries involved are worried about opening up their market to U.S. imports.

These agreements would also help to strengthen the existing trade agreements that already are in place with many of the countries in the area.

“We also need to realize that a tremendous amount of trade among these countries is already covered in existing agreements, so what we would be doing with the TTP and TTIP is expanding the membership and bringing everyone into the same circle,” Paggi commented.

Paggi said, in summary, the U.S. has a choice to remain engaged or be left behind. None of these agreements or policy solutions is perfect, so there will have to be a pro-con compromise.

“Also, keep in mind,” Paggi continued, “that trade agreements promote economic well-being, and economic stability promotes political stability, so the benefits of these agreements often transcend simple market access and sales opportunities.”

Tom Birmingham is General Manager of Westlands Water District, an agency of 615,000 acres on the west side of the San Joaquin Valley in Fresno and Kings Counties. “We are here to talk about ‘What’s on tap,’ which is a metaphor that creates an image I wish were applicable on the west side of the San Joaquin Valley,” Birmingham began, “I am not just talking about the Westlands Water District, I am talking about the west side of the San Joaquin Valley that includes the service of every agency that has an agricultural contract with the U.S.”

Tom Birmingham, general manager, Westlands Water District

“Unfortunately, and it almost brings tears to my eyes, next year, when the farmers in the Federal Water districts that use water from the Central Valley Project they open their taps, nothing is going to come. Nothing, that is, unless we have a dramatic change in the hydrology that we have been experiencing over the last year, actually the last eight months,” Birmingham warned.

“In California, water years fall in one of five classifications of hydrology; they have been classified as wet, above normal, below normal, dry or critical. If you talk about average hydrology in California, average rain, average snowpack, average runoff, it doesn’t mean a lot,” said Birmingham. “Because in fact, what is considered to be an average year, falls into a classification that is called, ‘a below-normal water year,’” he noted.

Birmingham continued, “But Westlands is projecting, and these are projections that the Bureau of Reclamation doesn’t take any issue with, that if we have average precipitation or hydrology for the rest of this water year, plus the same operational constraints the Endangered Species Act imposed in 2013 on the state water project and the Federal Central Valley project, our water supply will initially be zero. If we are lucky, we might get to 5% or 10% of our water supply.”

“So, we are facing a repeat of what we saw in 2009,” he noted, “when nearly half of the bare ground lay fallow in the Westlands Water District; where farmers over drafted the groundwater basin; where we experienced incredible unemployment; where people were forced to stand in lines to receive food, in some cases getting to the front of the line to be told the food bank had run out of food, or to get to the front of the line and be given carrots – grown in China. That, in my perspective, is a tragedy; it is unconscionable,” explained Birmingham.

“But that’s what we are faced with. It is hard to talk about these issues without talking about the Delta,” he said.

“The bad news is that in Kern County or the Friant-Kern service area, farmers and the Westside of the San Joaquin Valley, where groundwater is available, growers have been over drafting the groundwater basin,” said Birmingham.

“Westlands has one of the most sophisticated groundwater management programs that exist in the state,” explained Birmingham. “In fact, in 2009, when the state legislature adopted statutes requiring the development of groundwater management plans, Westlands was actually used as one of the examples of the types of information that could be collected.

But Westlands is projecting that in 2013, farmers in the district will use 598,000 acre feet of groundwater from the groundwater basin, compared to a safe yield of approximately 150,000 acre feet.

“The last time farmers in Westlands Water District extracted that much groundwater was in 1992, the fifth year of an extended drought,” said Birmingham.

“We have talked about subsidence and how it has historically occurred, and we are beginning to experience it in numerous places north of Fresno, Madera and Merced Counties,” he said.

“In fact, we continue to experience subsidence within the Westlands Water District. It is fascinating to drive long I-5, where it used to be perfectly flat and smooth. Today, as you drive along the Westside, there are lots of undulations. The same is true at the Three Rocks area of Fresno County. I remember highway 33 was perfectly flat, but today now there are undulations as a consequence of subsidence,” said Birmingham.

“We will continue to experience subsidence, but the rate of subsidence will accelerate. Currently the groundwater levels in Westlands are approximately 100 feet higher than in 1967 when deliveries from the Central Valley Project began. When we fall below that historic low groundwater level, we’re going to experience the types of subsidence that led to the authorization of the San Luis unit.

“Congress authorized construction of San Luis to alleviate subsidence on the Westside of the San Joaquin Valley,” said Birmingham.

“One of the things on tap is there is going to be some type of groundwater regulation. California is one of the few states that generally does not regulate the use of groundwater,” he noted.

There is a lot of groundwater monitoring in California, and in a few regions there are special groundwater management districts created by the legislature. But, generally the use of groundwater is not regulated to the same degree as surface water.

“There exists a lack of statewide effort to regulate the use of groundwater. I would suspect that all of our agencies would oppose that type of statewide legislation,” said Birmingham. “From our perspective, regulations should be made at a regional level because every groundwater basin is different and should be managed on a case-by- case basis instead of state-wide regulations.”

“But it is interesting, half of the farmers in the Westlands Water District take the historic agricultural position that groundwater is the resource available to overlying landowners, and no one has any business regulating their groundwater,” he said.

“If the other 50% of farmers in Westlands, do not become proactive in its management of ground water, as opposed to its monitoring, then the state will step in and do it on behalf of everyone in the state,” said Birmingham.

“Equally as controversial, if management is not done by regional entities like Westlands Water District, it will be regulated by county or state.”

“So, Westlands Water District is actively looking to get into the business of regulating the use of groundwater.”

Ron Jacobsma, general manager, Friant Water Authority

There is some good news, tempered with bad news. The good news is there are a lot of resources that can be reasonably and more effectively and efficiently managed.

Westlands Water District has experienced chronic water supply shortages on a regular basis since the implementation of the Endangered Species Act, and has coped using water transfer contracts based annually or on a longer-term basis with a fixed price.

Also speaking about water was Ron Jacobsma, General Manager, Friant Water Authority. He gave an interesting history of the San Joaquin River, Friant Dam, Millerton Reservoir and canal that serve 1,000s of growers on the East Side of the San Joaquin Valley from Madera to Kern County.

Brent Walthall, with the Kern Water Agency, talked about the many different and historical water districts in Kern County, as well as describing the innovative water banking that is taking place in Kern County during flood years.

Brent Walthall, Kern Water Agency

The event was sponsored by California State University’s Center for Agricultural Business, Jordon College of Agricultural Sciences and Technology, Bank of America, Wells Fargo, Zenith Insurance Company, Edgewood Partners Insurance Center, and Higgins, Marcus & Lovett.

There was also a session on Immigration Reform and its importance to the Central Valley. We will post that on Nov. 4.

Patrick Cavanaugh2016-05-31T19:43:12-07:00November 2nd, 2013|

TREE NUTS, EXCEPT PECANS, REMAIN STRONG IN EXPORTS

Tree Nuts, Still the 800-Pound Gorilla

Crash of the U.S. Pecan Market a Cautionary Tale, Says Rabobank

The export market for U.S. almonds, walnuts, pistachios and pecans continued to grow in 2012, reaching $6 billion dollars and accounting for over 60 percent of U.S. production. In its most recent report, “Riding The Growth Curve – Can U.S. Tree Nut Exports Continue to Defy Gravity?,” Rabobank questions whether this growth will continue. The author of the report, Karen Halliburton Barber, senior analyst, Produce for the Rabobank Food & Agribusiness Research and Advisory Group, says that it should, but that the industry shouldn’t rest on its laurels. “Assuming water limitations will not significantly restrict U.S. production, the U.S. tree nut sector still faces the fundamental uncertainty of when supply and demand will stabilize,” said Barber. “That said, the U.S. tree nut sector is in a good competitive position given its leadership in production and trading history.”In the report, Barber examines the main commodities making up the U.S. tree nut sector:

Almonds – “Here, the U.S. is the 800-pound gorilla and accounts for over 78 percent of total global production. This is where the U.S. is clearly in a good competitive position but needs to beware of the oversupply spiral.”

Pistachios – “Iran is slowing down, but they are not out. Water scarcity and weather have caused declines in production in recent years. However, new growth areas are cropping up and competition may heat up in the medium term.”

Walnuts – “This is the only sector where the U.S. is not the predominant global supplier. Although China is a net importer because of its large domestic demand, its share of global production is greater than that of the U.S., providing competition for U.S. walnuts in the Chinese market. An added risk factor is that Chile has begun to compete with the U.S. on quality in key growth markets.”

Pecans – “This segment is the cautionary tale of the report, warning of what could happen if the right factors line up at the same time. In 2012, the U.S. pecan market crashed. Now largely dependent on the global export market, U.S. pecans were hit with competitive pressures from South Africa, while at the same time dealing with lower yields because of weather challenges. The result of these factors was a 50 percent reduction in grower prices for pecans from July 2011 to January 2013.”

The report concludes by noting that the U.S. tree nut sector’s overdependence on the Chinese market poses the greatest challenge. Yet, U.S. producers are poised for growth over the longer term—both in China and globally. The strategy employed by the almond, walnut and pistachio industries of a more balanced buyer/supplier parity approach can help continue to moderate the risk.

Patrick Cavanaugh2016-08-12T18:04:52-07:00September 25th, 2013|

ENDANGERED SPECIES ACT OVERREACHES HUMAN RIGHTS

The Endangered Species Act Turns 40

A Statement by Rob Rivett, President, Pacific Legal Foundation.

This year the Endangered Species Act turns 40. President Richard Nixon, on December 28, 1973, signed into law one of the nation’s most powerful environmental laws. The law vested authority in the U.S. Fish and Wildlife Service and the National Oceanic and Atmospheric Administration to enforce a wave of new regulations, and create a new relationship between homo sapiens and other species.

Soon after its passage, the U.S. Supreme Court declared it the most comprehensive law ever passed for the protection of species and that ESA enforcement must occur “whatever the cost.” Federal officials have used their power under the Act to regulate private property as if it were public land.

The degree to which the ESA has been successful is a matter of debate. Of the estimated $3 billion of taxpayer funds necessary to fund the annual operation of the ESA, less than 1 percent of the species in North America have been recovered out of more than 1,400 that have been listed. One undebatable fact is the law has created a flood of lawsuits, those filed to seek government acts, and those filed to limit them.

Since its founding in 1973 — the same year the Endangered Species Act (ESA) was enacted — Pacific Legal Foundation has been America’s watchdog in the courts to check and reverse government abuse of this and other environmental laws.

PLF has enough experience with the ESA to know that a well-intentioned law can completely turn the tables on common sense, sound science, and the fundamental freedoms of people. PLF believes in responsible stewardship of our land, water, and air for the benefit of people, the environment, and the species that inhabit it. The trouble comes when a law designed to help species harms the people who care for the environment — including farmers, ranchers, and foresters — those living and working in America’s “environment.”

The protection of the environment is only one of many competing and important social values in America. In an orderly society, no single value can be exalted “whatever the cost.” Environmental laws can and must be administered so as to safeguard, and not thwart, fundamental human needs and rights. Therefore, Pacific Legal Foundation has assumed a leading role in protecting constitutionally established limits on governmental power and ensuring individual freedom.

Nearly 40 years after its enactment, the Federal Endangered Species Act remains one of the nation’s most potent threats to our constitutionally protected property rights. Crafted by the Congress with the noble goal of saving species from extinction, and helping them to return to health, the law today has led to controversy and regulatory creep across our nation’s landscape.

Because Pacific Legal Foundation supports a balanced approach to environmental regulations — like the ESA, we’re taking the opportunity in 2013 to examine aspects of the law, with particular emphasis on past and current cases we’ve litigated.

During the course of the year, this landing page will feature PLF opinion articles, videos, podcasts, and news and information about current PLF cases.  Whether you are part of the “regulated community” or just a concerned citizen who values liberty and a thriving environment, I invite you to check in regularly on this page to see our latest postings and to give us your feedback.

Of course, as a nonprofit legal charity, Pacific Legal Foundation welcomes your charitable donations.

If you believe, as we do, that in protecting our nation’s environment, our constitutional rights should not be threatened or endangered by government agencies and activist groups, I invite you to become a supporter of PLF’s legal program.

Patrick Cavanaugh2021-05-12T11:06:03-07:00August 22nd, 2013|

Tulare County Ag Value Just Behind Fresno!

Tulare County 2012 Crop Report Production Value Up 10 Percent

Tulare County’s total gross production value for 2012 is $6.22 billion. The report, released today, showed an increase of $581 million, or 10 percent above the 2011 value of $5.6 billion.

Dairy products continue to be the leading agricultural commodity in the County, with a total gross value of $1.8 billion, a decrease of 12 percent.

“Milk represents 29 percent of the total crop and livestock value for 2012,” said Marilyn Kinoshita, Tulare County Agricultural Commissioner. “Total milk production in Tulare County remained relatively stable,” she said.

Possibly, if milk prices were a little higher during the year, Tulare County would have beat Fresno County for the first time!

“Livestock and Poultry’s gross value of $661 million represents an increase of 5.8 percent above 2011, mostly due to an increase in value for turkeys, cattle and calves,” noted Kinoshita.

Fruit and nut commodities were valued at $2.8 billion representing an increase of 29 percent. “The majority of this gain was the result of an excellent year for our grape category,” Kinoshita noted.

The total value of all field crops was $776 million, an increase of 24 percent from 2011. “Local demand for dairy feed continues to keep high values for our field crops. Nursery products were valued at $67 million, representing an increase of 2.5 percent over last year. “This minor increase is a reflection of the continued uncertainties in both the housing and agricultural markets,” Kinoshita explained.

Vegetable crops were valued at $20 million in 2012, representing a less than one percent increase.

“The 2012 report covers more than 120 different commodities, 43 of which have a gross value in excess of $1 million. Although individual commodities may experience difficulties from year to year, Tulare County continues to produce high-quality crops that provide food and fiber to more than 84 countries throughout the world,” said Kinoshita.

Kinoshita expressed appreciation to her staff, particularly Lea Pereira, Jacqui Balderas, and Dennis Haines for their contributions to the report.

Patrick Cavanaugh2016-08-31T13:28:59-07:00July 23rd, 2013|