Farm Bureau President Urges Support to Sustain Farming

Courtesy of Peter Hecht

The leader of California’s largest agricultural organization today called on lawmakers to work to sustain agriculture well into the future by securing water supplies and rejecting policies that merely ask farmers and ranchers to be resilient in the face of unaddressed challenges.

Speaking before the 105th Annual Meeting of the California Farm Bureau in Reno, Farm Bureau President Jamie Johansson outlined “extraordinary events that have put all of California farmers and ranchers at risk.”

He noted the impacts of a three-year drought that resulted in the fallowing of more than 1.2 million acres of productive farmland. That was followed in 2023 by atmospheric river storms and destructive floods that caused hundreds of millions of dollars in damages to California farmland and crops.

Johansson took issue with California’s failure to complete long-planned water infrastructure projects that could have stored water for dry years and enhanced flood control in wet ones.

“While our members struggled, we faced administrations in Washington, D.C. and Sacramento who found it easy to blame it all on climate change,” said Johansson. He took political leaders to task for simply declaring that “agriculture would have to do less to meet climate goals.”

Johansson said farmers and ranchers need supportive policies rooted in science, not politics. He said Farm Bureau remains committed to “defending the use of science on our farms, our waterways…and saving the next generation of farmers and ranchers.”

“I truly believe it must be Farm Bureau and our membership who leads the fight.”

But Johansson cited some notable victories for California agriculture in 2023. That included advocacy that led Gov. Gavin Newsom to sign an executive order that rolled back unnecessary permitting requirements and bureaucratic red tape to allow farmers to divert floodwaters to recharge depleted groundwater aquifers.

“For 13 years, California Farm Bureau and some of our partners have been pushing the (California) State Water Resources Control Board to allow our farmers to use their land to recharge aquifers,” Johansson said. “This year, our efforts finally produced results.”

Johansson applauded actions by the governor that fast-tracked Sites Reservoir, a planned off-stream water storage project north of Sacramento long advocated by the Farm Bureau.

2023-12-04T15:08:02-08:00December 4th, 2023|

Floral Sales Soar as Valentine’s Day Nears

By Caleb Hampton, California Farm Bureau

Fresh cut flowers have seldom been so coveted.

A pandemic-related boom, driven by people beautifying their living spaces while stuck at home, has tapered slightly. But industry experts say a new-found emphasis on self care continues to boost demand, while the upcoming Valentine’s Day promises its usual bump in sales.

“It’s already busy,” Sherry Sanbo, owner of Golden State Floral, a wholesale florist in West Sacramento, said last week. “Right now, we’re trying to buy the product to fill our orders.” Inside her warehouse, clusters of flowers moved down conveyer belts as workers trimmed leaves, stacked boxes and stuffed bouquets.

Across the sector, Valentine’s Day typically trails only Mother’s Day in volume of flowers sold and is often the highest revenue event of the year. “We’re expecting a good, strong holiday,” said Steve Dionne, executive director of the California Association of Flower Growers and Shippers, or CalFlowers. “You can feel the rate of orders coming in now compared to prior years.”

Several factors point to a favorable Feb. 14 for flower producers. The day of the week the holiday falls on “has a huge impact on demand,” Dionne said. “If it’s a Saturday holiday, a lot of potential floral consumers may instead opt for dinner and a movie. This year, it lands on a Tuesday, which is one of those perfect days.” That alone, he said, can boost sales by 15%.

Strong demand is always good news for suppliers. However, various phenomena—from weather to inflation to geopolitics—have left many California growers with mounting challenges and shrinking profits.

“At the moment, things suck,” said Rene Van Wingerden, a Santa Barbara County flower farmer who has been in the business for nearly five decades. “Everything just costs more.”

The rising cost of fuel and farm labor have especially impacted growers. Michael Mellano, CEO of Mellano & Co., which farms 400 acres of flowers in San Diego County, said changes to California’s minimum wage and overtime laws increased his costs and “impacted our business significantly.”

In some sectors, rising retail prices have helped offset expenditures, but in many—including cut flowers—producers are seeing their margins whittled away. “Most input costs have gone up more than the price of flowers,” Dionne said. According to data from the U.S. Department of Agriculture, wholesale prices for most types of cut flowers were roughly equal this week to the same time last year.

For years, the global nature of the flower market—about 80% of flowers sold in the U.S. are imported—has prevented domestic flower farmers from raising prices in response to local conditions.

At the height of the pandemic, supply chain disruptions and labor challenges caused a worldwide shortage in cut flowers, reducing imports. Now, production in South America has rebounded, and with the war in Ukraine blocking some trade with Europe and Russia, more of those flowers are coming to the U.S.

“Some of our domestic flower growers are being increasingly pressured by low-cost imported flowers that are being moved into the marketplace,” said Camron King, CEO and ambassador for Certified American Grown, a nonprofit trade association representing U.S. cut flower farmers.

“Because of the trade circumstances, countries like Ecuador and Colombia are looking for places to sell their product, and it’s easy to move it into the U.S. market at a low price point,” King said. In some cases, he added, domestic growers are losing clients as buyers opt to import more of their inventory.

For California flower farmers, the series of atmospheric river storms that slammed the state last month further complicated Valentine’s Day business.

“When you have dark weather for four or five weeks, it slows production down,” Van Wingerden said. “The plants are like solar panels. They only work when the sun is out.” The Santa Barbara County farmer said the storms decreased his Valentine’s Day output by about 30%.

“California flower production is definitely going to be much lower than normal for Valentine’s Day,” said Marty Espe, employee-owner at Flora Fresh Inc., a Sacramento-based wholesale florist that sources flowers from more than a hundred California flower farms. “The storm system that came through, and the cold weather after, has severely slowed field production.”

Northern California, the Central Coast and the Santa Barbara area appeared to have been impacted the most, Espe said. According to wholesalers, many of the state’s dahlias and Matsumoto asters were wiped out. Gerbera daisies, because they are delicate and not easily imported, “are one of our strong points,” Van Wingerden said, but those characteristics made the daisies especially vulnerable to the storms.

“A lot of the California crops got hit hard,” said Sanbo, the Golden State Floral owner. “Because it was so cold, the flowers are also too short for bouquets. They have to be at least 25 inches. Now, they’re coming in at 22 inches.” The state’s dianthuses have been especially stunted, Sanbo said.

The losses for California flower growers have left wholesalers scrambling to fill Valentine’s Day orders—and ultimately resorting to more imports. “Our goal is to buy local—to buy California product first,” Espe said. “But when we hit situations like this, we’ve switched gears and are obtaining as much product as we can out of South America.”

Sanbo said Golden State Floral is also substituting California flowers with imports from Ecuador and Colombia, sometimes at a loss, she added, as it is too late for wholesalers to change the prices they’ve agreed with supermarkets and retail florists.

“California produces flowers that go all over the country,” Espe said. “With the number being limited, every wholesaler across the country is chasing product right now to cover their orders.”

2023-02-08T09:21:29-08:00February 8th, 2023|

High Heat, Low Demand Hurt Walnut Crop

By Christine Souza, California Farm Bureau

California farmers are tearing out walnut orchards, such as at this farm near Winters, in response to quality concerns due to a September heat wave, lower demand and prices, and other market issues. The California Walnut Commission estimates $1 billion in damages to the 2022 crop.

Walnut farmers are tearing out older trees and less desirable varieties as the price for the nut has plummeted well below the cost of production, causing some growers to rethink walnuts and look for alternative crops.

“I’ve seen several younger orchards that have come out already in Fresno, Merced and Madera counties,” said Kings County farmer Brian Medeiros of Hanford, who farms walnuts, almonds and row crops. “My neighbor had a walnut orchard that was about six years old, and he tore the whole thing out. He just said, ‘I’m losing money hand over fist. I’m not going to keep doing it.’”

A heat wave last September cooked the walnuts on the trees during a critical time of the growing cycle. High temperatures were followed by rain that led to mold problems.

“We had extremely high temperatures—up to 117 degrees for three to four days in some areas—and this occurred when walnuts were at their most sensitive stage in growth,” said Robert Verloop, president and chief executive officer of the California Walnut Board and California Walnut Commission. “We conducted our own informal survey of about 75% of the industry and documented pretty clearly that the range is anywhere from 30% to 40% of the (walnut) volume that was impacted. That means if the handler opens up 100 pounds of walnuts, 30 to 40 pounds is absolutely not usable.”

Walnut growers in Stanislaus County demonstrated to the county agricultural commissioner that there was 36% loss in crop volume, Verloop said. The growers provided damage information within the required 60 days, which led to a federal disaster declaration.

On Jan. 13, U.S. Agriculture Secretary Tom Vilsack designated a disaster declaration for Stanislaus County and contiguous counties of Alameda, Calaveras, Mariposa, Merced, San Joaquin, Santa Clara and Tuolumne for walnut losses due to the heat wave last September.

Farmers in qualifying counties have eight months from the date of the declaration to apply for emergency loans through the U.S. Department of Agriculture Farm Service Agency. The California Walnut Commission is working with federal lawmakers on additional aid, including walnut purchases by USDA for food banks and tree-pull programs.

With the price to growers for the 2022 walnut crop at about 40 cents per pound or less—and well below last year’s break-even price of between 70 and 90 cents per pound—walnuts were the obvious choice for removal for Medeiros, he said. He pulled out 16 acres of walnut trees to scale down his water use to comply with groundwater regulations and manage his allotment.

“Our orchard is only 15 years old, so when I was pulling out those 16 acres, it literally broke my heart because I’m pulling out beautiful trees that look gorgeous, and I’m bulldozing them over,” Medeiros said. “The (walnut) price is making it much easier, much quicker for us to move ahead because—unless this price changes dramatically in the coming year or we have some outstanding support from USDA—we’re probably pulling the rest of them out next year.”

Stanislaus County farmer Gordon Heinrich of Modesto, who farms walnuts and operates a huller and dehydrator, said the price of walnuts is at a 30-year low, and input costs have gone up substantially.

“We’re actually operating below the cost of production right now, and everybody’s scratching their heads trying to figure out where you can cut back on your inputs to survive this market situation,” Heinrich said.

“There’s not a lot of places you can cut,” he added.

Handlers are advising walnut growers to remove older, darker-kernel varieties such as Vina, Serr and Hartley, to maintain the supply of light walnuts, Chandler, Tulare and Howard, that global buyers demand.

“Growers are starting to realize that all those older varieties need to be taken out and replanted with a more modern variety, such as a Chandler,” Heinrich said. “The quicker that we can change our market strategy as far as being able to put a better product on the market, the longer this is going to last. It is going to right itself in time, but there’s a lot of farmers out there who are going to have a real tough time.”

Verloop said handlers reported 20% to 50% of the 2022 walnut crop was substandard in quality and is better suited for cattle feed. He said the commission estimates the farm-gate loss to growers is $1 billion.

Aside from quality problems, Verloop said many different factors affect the market for California walnuts, much of which are exported to Europe, Turkey, India, Spain, Japan, Korea and the Middle East.

“The problem is the pipeline to the consumer has a lot of walnuts in it already,” Verloop said. The carryover from the 2021 crop of about 135,000 tons, he said, and the 2022 crop is expected to be between 750,000 tons to 780,000 tons and much larger than the 720,000-ton crop forecast last September.

Retaliatory trade tariffs and the COVID-19 pandemic added to the walnut supply-demand imbalance and led to trucking and transportation challenges, congestion at the ports and a slowing of consumer demand. Inflation, the higher value of the dollar and the war in the Ukraine also are affecting customer confidence and buying power, Verloop said.

“We’re in the middle of that perfect storm,” Heinrich said of the global and economic stressors impacting the walnut market. “We’re hoping that we can just hang on. We’re lucky with our operation that we’re somewhat diversified, but even almonds are struggling with some of the same problems.”

Bill Carriere, president of Carriere Family Farms—a grower, processor and marketer of walnuts in Glenn County—said it is a very nervous time for growers and handlers.

“Sales were slow in general, and you had quality concerns that doubled the problem. That really hurt storage, so our storage is full. There are walnuts in warehouses that are not normally in warehouses,” said Carriere, who added that 20% of the 2022 walnut crop he received is not salable. “In our operation, we’re losing much more money as a grower than we are as a handler, but we’re losing in both.”

To recover from this year’s challenges, Verloop said, “the goal right now is to remove all of the substandard quality product off the market and let the good quality product price start to come up a little bit.”

For the next year or two, Verloop said he expects a downsizing of the walnut sector as growers remove less productive acres and less desirable heritage walnut varieties.

“We’re working with all of our trade agencies around the world to take a look at what can we do to recover from this year,” Verloop said. “We think there’s a lot of trust and confidence long term in our product from California because it’s been the gold standard. We’re working hard on several different fronts to make sure that we’re better positioned in the future.”

Growers seeking more information about disaster assistance and other program relief are encouraged to contact their local Farm Service Agency.

2023-02-01T14:36:16-08:00February 1st, 2023|

California Farm Bureau Congratulates Speaker McCarthy

By Peter Hecht, California Farm Bureau

California Farm Bureau President Jamie Johansson applauds California’s Kevin McCarthy on his election as Speaker of the U.S. House of Representatives.

“As a former member of the House Agricultural Committee who hails from California’s vital Kern County farming region, Speaker McCarthy has long been an advocate for farmers and ranchers in the Golden State,” Johansson said. “He understands the importance of the nation’s leading agricultural economy and its bounty of ‘California-Grown’ products, which feed America and the world beyond. We look forward to partnering with Speaker McCarthy on key issues to help California farmers, ranchers and agricultural businesses prosper for generations to come.”

2023-01-10T09:57:51-08:00January 10th, 2023|

California Farm Bureau Reacts to ‘Waters of U.S.’ Rule

By Peter Hecht, California Farm Bureau

The U.S. Environmental Protection Agency on Dec. 30 released the revised definition of the “Waters of the United States” rule to redefine waters protected under the federal Clean Water Act. This new rule will replace the Navigable Waters Protection Rule.

California Farm Bureau President Jamie Johansson expressed his concerns on behalf of farmers, ranchers and agricultural businesses in the state.

“This rule will have a substantial effect on our members and the ability of our farmers and ranchers in California to continue to utilize their land,” Johansson said. “We are particularly concerned about small farms and ranches needing costly legal or consulting expertise to farm ground they have already thoughtfully and sustainably stewarded.”

2023-01-03T14:09:54-08:00January 3rd, 2023|

Almond Sector Assesses Toll After its ‘Toughest’ Year

By Christine Souza, California Farm Bureau

With the ongoing multiyear drought, global logistical challenges and inflationary impacts affecting California’s $5 billion almond crop, leaders in the almond sector say they are hopeful for a return to a more profitable outlook in 2023, with a more orderly supply chain and lower production costs.

Almond Board of California President and CEO Richard Waycott told several thousand attendees at the organization’s 50th annual conference, held Dec. 6-8 in Sacramento, that “the past year is probably the toughest we’ve had as an industry.”

As part of the state of the industry address, Waycott, joined by Almond Board Chair Alexi Rodriguez of Campos Brothers Farms in Fresno County, cited challenges affecting the almond sector. These include limited water supply, logistical and supply-chain issues, rising interest rates, inflation and the war in Ukraine.

“This combination has created this perfect storm that has had a profound impact on our industry,” Rodriguez said. “This industry has been through challenging times before, and with great challenges come great opportunities for growth and innovation.”

She added, “We are a resilient industry, and together we’re going to get through it.”

In presenting the economic outlook for California almonds, David Magaña, a Rabobank vice president and senior analyst based in Fresno, said the state’s almond acreage decreased this year for the first time in more than 25 years. The decrease was first reported in a Land IQ report commissioned by the Almond Board.

Total standing acreage as of Aug. 31 was estimated at 1.64 million, compared to 1.66 million acres at the same time in 2021, the report stated. Bearing acres—orchards producing almonds and planted in 2019 or earlier—increased slightly to 1.34 million from 1.31 million last year. Nonbearing acres—new plantings going back to 2020 but not yet bearing almonds—dropped to 294,000 acres from 353,000 acres in 2021.

“On the supply side, we expect to continue to see large volumes of almonds—depending on the weather and depending on water—in the next few years,” Magaña said. “The most optimistic view I have is the global middle class will continue to demand food that we grow here in California, including almonds.”

California growers this year are expected to produce 2.6 billion pounds of almonds. This is less than the amount shipped in each of the past two years, which were the two largest production and shipment years since record keeping began. Waycott said, “Hopefully we can see things come into a better equilibrium.”

Looking ahead, Waycott told attendees that the Almond Board plans to drive global demand through marketing programs and new product development, such as consumption of almonds to promote skin health and use of almond hulls as a food ingredient.

In addition, Waycott said, the Almond Board is halfway to achieving its 2025 almond orchard goals to achieve zero waste, increase environmentally friendly pest management, reduce dust and increase water efficiency.

In a panel session on managing less water, farmers and water leaders discussed approaches such as use of more groundwater recharge and development of regional strategies.

“It’s a little difficult to talk about groundwater recharge in a drought year,” said Daniel Mountjoy, director of resource stewardship at Sustainable Conservation. He said the state, growers and water districts must be prepared to Aapply water to the land when it does arrive.

“The most economical way to store water in the state right now is putting water back on the ground and into the aquifer,” Mountjoy said.

Groundwater sustainability agencies are exploring incentives to encourage farmers to recharge in optimal locations, he said.

Fresno County farmer Stuart Woolf of Woolf Farming, which is an irrigator in the Westlands Water District, discussed his response to water shortages.

“Years ago, we started running all of our budgets based the return per acre-foot of water, and that really drove a lot of our plantings,” Woolf said. “I never contemplated that I would ever consider taking out almonds so I could grow more row crops, but fortunately, we’re in a position to do that.”

Woolf said he expects to fallow 1,100 acres of almonds and plant 1,500 acres of row crops.

“We’re losing money,” Woolf said. “They (almonds) use over 4 acre-feet, and I can turn around and grow row crops and actually make a lot more money. I would encourage everybody in the room to be looking at these numbers and looking at your alternatives.”

Searching for solutions, Woolf said, he farms ground in other counties and is looking into growing drought-tolerant crops, including agave for tequila.

“We’re going to give it a try. I have a test plot with about 4,000 plants, so we’re trying to think about these things creatively,” Woolf said.

During a panel discussion on almond pollination, Elina Niño, an entomologist who specializes in honeybees at the University of California, Davis, discussed research related to self-pollinating almond varieties.

Niño said UC research shows yields are higher when honeybee colonies are used for pollinating these varieties. In response to a question about the number of hives needed per acre to pollinate almonds—usually two hives per acre—Niño said, “That is still the question that remains to be answered. This is something that is going to have to be an individual decision for growers.”

The Almond Board conference began 50 years ago as a half-day meeting to share research findings with growers.

Since then, said Stanislaus County almond grower and processor Jim Jasper of Stewart & Jasper, the annual event has become “the Super Bowl of the industry.”

2022-12-14T09:30:19-08:00December 14th, 2022|

State Aid to Help Community Water Systems Amid Drought

Source: California Farm Bureau

The California Department of Water Resources awarded $86 million in financial assistance to meet immediate and long-term water needs for millions of Californians, including for small communities struggling to address drought impacts.

Of the new round of funding, $44 million will provide assistance to 23 projects through the Small Community Drought Relief program. Some of the funded projects to benefit disadvantaged communities include:

• $4.2 million to construct a pipeline in Fresno County from an existing water treatment plant to the community of Mira Bella’s distribution system to support water supply resiliency.

• $3.4 million to consolidate the West Goshen water system into the nearby public water system, Cal Water Visalia, in Tulare County. The unincorporated community is facing a public health emergency due to water quality and water supply issues.

• $2.4 million to the Indian Valley Community Services District in Plumas County to replace 6,500 feet of water distribution pipelines for Greenville. The town is losing half of its water supply due to excessive leaks.

• $2.2 million to the Best Roads Mutual Water Company in San Benito County to construct a new water tank and consolidate the water system with the Sunnyslope Water District. The company is relying on bottled water for customers after two wells failed.

• $1.8 million to Santa Clara County to replace four leaking tanks and expand storage at a Santa Clara County treatment plant.

• $1.6 million for the Redway Community Services District in Humboldt County to construct three new wells and replace and rehabilitate existing tank infrastructure.

To build long-term climate resilience, DWR is awarding $42 million in grants through the Integrated Regional Water Management program. Funded projects include:

• $2.9 million to modify the San Joaquin County Flood Control District’s south distribution system to provide efficient and metered delivery of surface water to farmers to use in lieu of groundwater.

• $2.4 million to the San Diego County Water Authority to construct a pipeline from the San Vicente water reclamation plant to an existing nonpotable pipeline on the Barona Reservation. This will provide up to 250 acre-feet of water per year of recycled water.

• $427,000 to Mariposa County to reconstruct a failing leach field, which is the primary wastewater disposal facility for a community in the Yosemite-Mariposa region.

• $300,293 to the Merced Irrigation District to build a 30-acre water storage reservoir that will store up to 750 acre-feet per year of flood flows in the San Joaquin River region. Stored water will be used to irrigate 2,100 acres of farmland and recharge groundwater. The project will permanently fallow 30 acres of farmland.

• $229,000 to the Eastern California Water Association to develop a groundwater model in the Inyo-Mono region to better understand the amount and flow of groundwater. The groundwater model will serve as a tool to analyze future groundwater conditions and inform groundwater sustainability agencies on new well construction.

The project will benefit the Benton Paiute Reservation. The association will also receive $120,000 to restore 800 acres of instream habitat in Oak Creek and increase flood protection. The project benefits residents of the downstream Fort Independence Indian Reservation.

The announcement of the regional grants is the first phase of funding, with additional funding to be announced through spring 2023.

The Integrated Regional Water Management program has awarded more than $1.5 billion throughout California, which has been matched by $5.6 billion in local investments to help implement over 1,300 projects.

2022-12-07T13:10:59-08:00December 7th, 2022|

Farm Bureau President Rejects Policy of Scarcity for Agriculture

By Peter Hecht, California Farm Bureau

California Farm Bureau President Jamie Johansson opened the organization’s 104th Annual Meeting in Monterey Monday by calling on policymakers to build critical infrastructure to protect water resources and allow America’s most important agricultural sector to continue to thrive.

“The management of scarcity is failing,” Johansson told the gathering. “It’s time now to reimplement the management of bounty, which made California great.”

California’s nearly 70,000 farms and ranches produce more than 400 commodities as the nation’s leading food producer. But a recent University of California, Merced, study estimates that an additional 750,000 acres of farmland in the state were fallowed this year due a third year of drought and cuts in state and federal water deliveries to agriculture.

Johansson stressed that such an outcome may have been avoided had California delivered on the $7.1 billion water infrastructure bond approved by state voters in 2014. He said the state has failed to update its water system to meet the needs of California farms and communities as well as the challenges of a drier climate.

The consequences for agriculture are aggravated, Johansson said, by policies that stem from a mindset of working within the limits of scarcity—of adapting to a changing environment by paring down California’s agricultural potential.

Instead, Johansson said, new water storage and groundwater recharge projects can capture and store water in wet years for dry years and help protect and grow California’s food production.

“Change is inevitable,” Johansson said. “We understand change in agriculture. But what we struggle with is a state that doesn’t have a plan of how we make those changes based on principles.”

Johansson said, “We can continue in agriculture to make a difference, feed the world and more importantly prosper our communities.”

2022-12-06T08:38:08-08:00December 6th, 2022|

California Farm Bureau Reacts to Initial 5% Water Allocation

By Peter Hecht, California Farm Bureau

The California Department of Water Resources on Thursday announced an initial allocation of just 5% of requested 2023 water supplies from the State Water Project. This comes after this year and 2021 both yielded final water allocations of 5%.

“Here we go again,” said California Farm Bureau President Jamie Johansson. “This means that 23 million people and 750,000 acres of farmland are facing another year of uncertainty and economic hardships. California has failed to act on critical projects to provide additional water storage, stormwater capture and groundwater recharge that are needed to protect our farms and cities from water shortages in dry years.

“California’s dismal leadership in safeguarding our water resources harms our food production as consumers face rising prices at the grocery store. It also undercuts healthy crop production, which helps reduce carbon emissions that contribute to climate change. California must have a more coherent water plan. Our drought strategy cannot solely be a policy of managing scarcity.”

2022-12-02T15:54:36-08:00December 2nd, 2022|

Conversion to Organics Could Increase Food Prices, Shrink Farm Profits

By Peter Hecht, California Farm Bureau

A European Union policy goal to exponentially increase organic farming to 30% of all agricultural production by 2030 is expected to be considered by Gov. Gavin Newsom for next year’s budget. However, a new economic analysis says such a plan would dramatically increase the price of food for many consumers and jeopardize the solvency of organic farms.

California currently has an estimated 7.35 million acres of irrigated cropland, of which 460,000 acres—or 6%—is certified as organic and not all of that is farmed in any given year.

A preliminary analysis by ERA Economics, a Davis-based consultancy specializing in the economics of agriculture and water resources in California, focused on the potential challenges of applying the EU standards to one California crop: tomatoes. The state produces 95% of America’s processing tomatoes and the total annual tomato crop is valued at $1.2 billion.

Only 5% of California’s 228,000 processing tomato acreage is currently needed to meet consumer demand for organic. The study found that reaching 30% organic production by 2030 would cause substantial disruptions to the market. The farmgate price of conventional tomatoes was estimated to rise by more than 11%. And, importantly, the price for organic tomatoes was estimated to fall by 28% at the farmgate level—potentially putting the market price below the cost of production.

That could mean organic farmers would be forced to cease production, sell, or farm something else—a result that could potentially crash the organic market and ultimately drive-up consumer prices. Mandating an increase in organic acreage without a clear connection to consumer demand could result in market disruptions that would hurt farmers, farm employees and consumers alike, the study noted.

Any initial organic price drop would mostly benefit wealthier consumers who purchase organically grown products, with lower-income customers paying more for traditionally grown products. All tomato farmers, organic or not, could see reduced profits, according to the analysis.

“Farming works when we are able to grow what the consumer actually wants and not what government mandates. California consumers are already struggling to afford higher prices for food than other states because of government mandates and these types of proposals just make things worse,” said Jamie Johansson, president of the California Farm Bureau. “When the government increases the price of food, it acts like a regressive tax, hurting lower- and middle-income families the hardest. At the end of the day, the government needs to let organic markets grow organically.”

The study was funded by Californians for Smart Pesticide Policy, a coalition of farmers and businesses the rely on farmers, focused on educating policymakers on the benefits of modern scientific agricultural tools. It was undertaken on behalf of the California Bountiful Foundation, the 501(c)(3) science and research arm of the California Farm Bureau. The full report may be found at https://www.californiabountifulfoundation.com/research/.

A recently released report (https://www.fb.org/newsroom/farm-bureau-survey-shows-thanksgiving-dinner-cost-up-20) by the American Farm Bureau Federation shows that the average cost of a family’s Thanksgiving dinner—now $64.05—is up 20% from 2021 and nearly 36% from 2020.

The findings by ERA Economics include the following:

• To increase organic acreage for processing tomatoes from an average of 4% to 30% would represent a five- to six-fold increase in current acreage. Tomato growers and processors interviewed for the analysis confirmed industry data regarding consumers’ finite desire to purchase organic tomato products.

• Tomato growers may specialize in organic, non-organic or both, depending on market demands and conditions. By mandating a specific growing method, it could greatly impact the ability of farmers to keep their operation sustainable, both financially and as they encounter other challenges, such as climate change and pests and disease.

• Both conventional and organic farmers of processing tomatoes face risks of economic losses. Conventional growers, with likely reduced acreage, could see a 17% potential downside cost from expected earnings.

• Organic production presents greater risk of crop failure, higher production costs and lower crop yields. As a result, organic farmers are likely to see less stability. They face a potential downside cost of 36% of anticipated net returns, making it potentially unprofitable to grow organic processing tomatoes.

2022-11-23T09:00:36-08:00November 23rd, 2022|
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