The Sacramento Bee* reported bad news for California almond growers, but the director of the UC Agricultural Issues Center, Dan Sumner, still had encouraging words for the industry.
According to the Bee story, written by Jim Downing, almond prices dropped more than 30 percent from August to December, the market for orchard real estate has gone cold, and the industry expects to be left with a 300 million pound surplus when the 2009 harvest begins in August.
Making matters still worse is a looming drought. West Side farmer John Diener told the reporter he plans to fallow 3,000 acres of land in order to concentrate what water he will have available on his 750 acres of almonds, which represent millions of dollars of investment.
But Sumner expressed confidence in California almonds. The state, he said, is the dominant global almond producer, holding more than 80 percent of the market. There are no serious competitors on the horizon.
"I still think they have a very strong long-term future," Sumner was quoted in the article.
Speaking of Dan Sumner, the UC Davis ag economist was also cited in a Reuters story today about President Barack Obama's pledge to cut subsidies to big U.S. farm businesses.
Some trade experts believe reducing payments to U.S. farmers would be looked on favorably by the rest of the world and that the move would renew the Doha round of WTO talks. But Sumner indicated that direct payments are not as trade-distorting as other subsidies that go up when prices plunge or crops fail.
"A cut in direct payments would do little or nothing for the talks," Sumner was quoted in the article. "It is hard to see the current (U.S.) leadership moving forward on trade opening or paying much attention to the WTO."
*The almond story was attributed to the Sacramento Bee, moved on the McClatchy wire and was picked up by various outlets, however, I could not find it on the SacBee Web site.
A California almond orchard in bloom.
The slogan for Rally's burger stand, "Ya gotta eat," is probably soothing to American farmers. As Associated Press writer James Prichard wrote in an article about agriculture in the ailing economy, "While people will put off buying houses and cars in a bad economy, they still need food."
The story said the economic downturn could even boost income for food producers who know how to take advantage of the situation.
For the article, Prichard spoke to the director of the UC Agricultural Issues Center, Dan Sumner, who pointed out that the agricultural sector isn't immune to the economic recession.
He said consumers are likely to cut back on goods they perceive as more dispensable (wine? asparagus? organic Saturn peaches?) while continuing to purchase basic agricultural products containing corn, soybeans, wheat, butter or milk. Also, because of the recession, credit is harder to come by. Many growers and producers borrow money to pay for seeds or equipment, or to operate or grow their businesses.
The article included a link to the UC Ag Issues Center Web site.
Saturn peaches are more expensive than traditional varieties.
Last year, agribusiness and most business sectors road an economic roller coaster. The 2009 outlook is tough to forecast, according to a Sacramento Business Journal article that used the director of the UC Agriculture Issues Center Dan Sumner as its primary source.
The bulk of the article is blocked on the Business Journal's Web site, accessible, it says, only to paid subscribers. But the Internet makes it available elsewhere, such as on the Wichita Business Journal's Web site (an example of the media's own economic conumdrum).
In the article, written by Celia Lamb, Sumner commented on tree nuts and wine, which he said could be vulnerable if consumers decide to cut back on luxuries, and grain markets. Corn, he noted, was priced at $3.98 per bushel in January 2008, and rose to $5.47 in June. By November, it fell to $3.94 per bushel.
“Feed prices look like they’re going to be much more moderate (in 2009) than we would have thought,” Sumner was quoted. “That is good news for California, (because) we’re big in the dairy market and we’re not as big in the grain market.”
Sumner offered some good news to the agriculture industry in general.
“I’m thinking net farm income will hold up in agriculture better than the rest of the economy,” he was quoted.
As Californians wait patiently today for the state budget vote, scheduled for 4 o'clock this afternoon, it's a good time to review the value of agriculture and agricultural research as it has been reported in the press in recent days.
Last Wednesday, Western Farm Press ran an Almond Board press release about a symposium that took place earlier this summer in Sacramento. At the symposium, UC ANR associate vice president Rick Standiford noted that there has been a 24 percent reduction in UC Agricultural Experiment Station researchers and Cooperative Extension staff since 1990.
The story said UC's academic staff is expected to shrink through retirement with 66 percent of UC Extension farm advisors set to retire in the next 10 years.
Almond yields have increased 86 percent over the last two decades largely because of improved horticulture techniques developed through publicly-funded agricultural research and development and extension.
A consequence of a slowdown in growth of public research spending "could be a decline in global competitiveness for California agriculture," the story said.
Last week, AgAlert ran a story on California's agricultural revenue in 2007, which reached $36.6 billion, an increase of 15 percent over the previous year's total of $31.8 billion.
The news about the industry isn't all good, however. Reporter Christine Souza sought comment from the director of the UC Ag Issues Center, Dan Sumner, about farmers' struggle to pay for increased input costs, such as fuel and fuel-based products, water, wages, equipment, government fees and taxes.
"What has everybody worried is that if output prices start coming down they are concerned that the input prices, particularly anything with an oil base or fossil fuels base, will stay high and that includes fertilizer and all of the energies," Sumner is quoted.
In the first paragraph of his blog entry on the Huffington Post, Michael Markarian accuses "big agribusiness" of:
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Duping the public
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Harming animals
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Polluting the environment
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Exploiting Latino workers
Ouch. The article actually focuses on Proposition 2, an initiative on California's November ballot known as the "Prevention of Farm Animal Cruelty Act." The story mercilessly takes aim at anyone who opposes its passage.
One of the new law's provisions will outlaw cramped cages for egg-laying hens. Markarian writes that opponents' insinuation that more eggs will be imported from Mexico if the initiative passes is untrue and he went to the director of the UC Agricultural Issues Center, Dan Sumner, for factual support of his position.
Sumner, the author of a UC Davis study on the egg industry, said "it's not very likely" that Mexico would start supplying California's eggs. "Mexico doesn't produce much feed corn and that's why Mexico isn't a logical place for production," he is quoted in the blog post.
In the UC news release about his study, Sumner also said, “The most likely outcome (of the initiative's passage) is the elimination of almost all of the California egg industry over a very few years." That fact, however, didn't make it in Markarian's rant.
Tired of haranguing political pundits? Here's a story that provides a welcome break.
The Modesto Bee ran an article about the subtle flavor variations of honey produced by bees that feed on different plants.
Wildflowers - buttery
Starthistle - slightly musky, fresh grain notes
Orange blossom - hints of rose, slightly citrus
Manzanita - smoky, woody and slightly vegetable with a peppery finish
The bees themselves have flavor preferences, UC Davis entomologist Eric Mussen commented in the article.
"For example, if they are in an alfalfa field with an almond orchard nearby, they will fly right past the alfalfa because they prefer almond flowers. But if alfalfa is the only nectar source, they will go to the alfalfa field," Mussen is quoted in the article.
