California Ag Network

Category: Ag Economics

  • Dairy Farmers Seek Emergency Hearing on Class I Mover Reform

    The National Milk Producers Federation’s Board of Directors voted today to request an emergency USDA hearing on a Federal Milk Marketing Order proposal to restore fairness for farmers in the Class I fluid milk price mover. The endorsement of the board, which represents dairy farmers and cooperatives nationwide, follows approval from the organization’s Executive Committee last week.

    The NMPF plan would ensure that farmers recover lost revenue and establish more equitable distribution of risk among dairy farmers and processors. The current mover was adopted in the 2018 farm bill and intended to be revenue neutral while facilitating increased price risk management by fluid milk bottlers. But the new Class I mover contributed to disorderly marketing conditions last year during the height of the pandemic and cost dairy farmers over $725 million in lost income. NMPF’s proposal would help recoup the lost revenue and ensure that neither farmers nor processors are disproportionately harmed by future significant price disruptions.

    “As the COVID-19 experience has shown, market stresses can shift the mover in ways that affect dairy farmers much more than processors. This was not the intent of the Class I mover formula negotiated within the industry,” said Randy Mooney, the dairy farmer chairman of NMPF’s Board of Directors. “The current mover was explicitly developed to be a revenue-neutral solution to the concerns of fluid milk processors about hedging their price risk, with equity among market participants a stated goal.

    “Dairy farmers were pleased with the previous method of determining Class I prices and had no need to change it, but we tried to accommodate the concerns of fluid processors for better risk management. Unfortunately, the severe imbalances we’ve seen in the past year plainly show that a modified approach is necessary. We will urge USDA to adopt our plan to restore equity and create more orderly marketing conditions,” Mooney said.

    While the current Class I mover was designed to improve the ability of fluid milk handlers to hedge milk prices using the futures market, it was also expected to be revenue-neutral compared to the formula it replaced. But that has not been the case. The significant gaps between Class III and IV prices that developed during the pandemic exposed dairy farmers to losses that were not experienced by processors, showing the need for a formula that better accounts for disorderly market conditions.

    NMPF’s proposal would modify the current Class I mover, which adds $0.74/cwt to the monthly average of Classes III and IV, by adjusting this amount every two years based on conditions over the prior 24 months, with the current mover remaining the floor. NMPF’s request will be to limit the hearing specifically to proposed changes to the mover, after which USDA would have 30 days to issue an action plan that would determine whether USDA would act on an emergency basis.

    The National Milk Producers Federation, based in Arlington, VA, develops and carries out policies that advance dairy producers and the cooperatives they own. NMPF’s member cooperatives produce more than two-thirds of U.S. milk, making NMPF dairy’s voice on Capitol Hill and with government agencies. For more, visit www.nmpf.org.

  • CA Almond Acreage Continues on the Rise

    The Almond Board of California (ABC) is releasing two California almond industry acreage reports: USDA’s National Agricultural Statistics Service (USDA-NASS) 2020 California Almond Acreage Report including the 2021 preliminary bearing acreage, and Land IQ’s 2021 Standing Acreage Initial Estimate (bearing acres, only). These reports are being issued side by side to improve industry reporting methods and provide a more robust picture of California’s almond acreage.

    USDA-NASS reports a continued increase in California’s almond acreage in 2020. Bearing acres, or orchards that have matured enough to produce a crop, are estimated at 1.25 million acres, up 5.9 percent from 2019. Total almond acreage, including non-bearing trees, is estimated at 1.6 million, up 5.3 percent from the previous year.  Nonpareil continued to be the leading variety, followed by Monterey, Butte, Carmel, and Padre.

    Land IQ’s initial estimate for total bearing acreage in 2021 – which reflects standing acreage that will be productive during the 2021/2022 harvest – is 1,323,722 acres.  This estimate takes into account both young orchards coming into production and orchards removed or estimated to be removed.

    “California almond bearing and non-bearing acreage continues to increase indicating almond production will also rise in coming years. Demand has consistently been very strong during this crop year with global shipments YTD (August 2020 – March 2021) up 17.7%, as production crossed the 3 billion pound threshold for the first time,” said Richard Waycott, president and CEO of the Almond Board.

    All export regions of the world have reported strong numbers, with shipments to China/Hong Kong up 59% year to date (YTD), South Korea up 45% YTD, India up 51% YTD, and Western Europe up 12% YTD, as compared to a year ago.

    USDA-NASS’s acreage report is the first of three annual reports, including the Subjective Estimate released in May and Objective Report in July. These reports are commissioned by the Almond Board to provide statistical transparency to industry stakeholders around the world.

    Each USDA-NASS California Almond Acreage Report includes estimates on bearing, non-bearing and total acreage, in addition to data organized by variety, year planted and county. A major source of data for this survey is almond growers’ voluntary responses to mailed questionnaires distributed by USDA-NASS, with consecutive telephone and field follow-up. To arrive at the estimated almond acreage, USDA-NASS compares its almond acreage database with the 2017 Census of Agriculture, pesticide application data maintained by County Agricultural Commissioners and the California Department of Pesticide Regulation, in addition to data collected on the 2020 Almond Nursery Sales Report, which this year USDA-NASS released in conjunction with the California Almond Acreage Report, and Land IQ assessment.

    In 2018, ABC first commissioned Land IQ, a Sacramento-based agricultural and environmental scientific research and consulting firm, to develop a comprehensive, living map of California almonds. The map is the result of nearly a decade of research, and because Land IQ’s approach does not rely on surveys or extrapolation, it has an accuracy of 98% or greater. Beginning in 2019, ABC began a mapping process with Land IQ in which two acreage estimates will be released annually: the initial estimate of bearing acreage in the spring and the final estimate, with both bearing and non-bearing acreage for the same production year, delivered in the fall. In addition to the acreage estimates, Land IQ will annually produce an estimate of removed acreage.

    This year, Land IQ’s spatial analysis shows that between September 1, 2020, and March 31, 2021, 44,303 acres were removed and estimates that an additional 3,500 acres will be removed from April 1 to August 31, 2021, for a total estimate of 47,803 acres removed.

    Starting in 2020, Land IQ annually provided its initial estimate to USDA-NASS to fine-tune the official California Almond Acreage Report and other forecasts. The USDA-NASS reports and estimates remain the official Almond Board statistics provided for the California almond industry.

    On Wednesday, May 12, 2021, USDA-NASS will release the 2021 Subjective Estimate, which provides an initial forecast of the upcoming crop. Data within the Subjective Estimate is based on opinions obtained from almond growers in a survey sent by USDA-NASS. Almond growers will soon receive the USDA-NASS survey and are encouraged to participate. On Monday, July 12, 2021, USDA-NASS will release the 2021 Objective Report. This report collects data later in the growing season, closer to harvest, and is based on an actual count of nuts on the trees. — Almond Board of California

  • Report Shows Significant Economic Impact of Pistachios

    The western pistachio industry has a much bigger impact on the nation and world than people may realize.  In addition to providing a healthy and nutritious snack to consumers across the world, the US Pistachio industry has a significant impact on the economy as well, as recently measured in a study by economist Dennis Tootelian.  Watch this brief interview as he shares the results of his study, and read more about it in Pacific Nut Producer Magazine.
    Please thank this video’s sponsor Trece for their industry support.

  • USDA Expands Conservation Reserve Program to Boost Enrollment, Address Climate Change

    Agriculture Secretary Tom Vilsack announced today that USDA will open enrollment in the Conservation Reserve Program (CRP) with higher payment rates, new incentives, and a more targeted focus on the program’s role in climate change mitigation. Additionally, USDA is announcing investments in partnerships to increase climate-smart agriculture, including $330 million in 85 Regional Conservation Partnership Program (RCPP) projects and $25 million for On-Farm Conservation Innovation Trials. Secretary Vilsack made the announcement today at the White House National Climate Task Force meeting to demonstrate USDA’s commitment to putting American agriculture and forestry at the center of climate-smart solutions to address climate change.

    The Biden Administration is working to leverage USDA conservation programs for climate mitigation, including continuing to invest in innovation partnership programs like RCPP and On-Farm Trials as well as strengthening programs like CRP to enhance their impacts.

    “Sometimes the best solutions are right in front of you. With CRP, the United States has one of the world’s most successful voluntary conservation programs. We need to invest in CRP and let it do what it does best—preserve topsoil, sequester carbon, and reduce the impacts of climate change,” said Vilsack. “We also recognize that we can’t do it alone. At the White House Climate Leaders Summit this week, we will engage leaders from all around the world to partner with us on addressing climate change. Here at home, we’re working in partnership with producers and local organizations through USDA programs to bring new voices and communities to the table to help combat climate change.”

    Conservation Reserve Program

    USDA’s goal is to enroll up to 4 million new acres in CRP by raising rental payment rates and expanding the number of incentivized environmental practices allowed under the program. CRP is one of the world’s largest voluntary conservation programs with a long track record of preserving topsoil, sequestering carbon, and reducing nitrogen runoff, as well providing healthy habitat for wildlife.

    CRP is a powerful tool when it comes to climate mitigation, and acres currently enrolled in the program mitigate more than 12 million metric tons of carbon dioxide equivalent (CO2e). If USDA reaches its goal of enrolling an additional 4 million acres into the program, it will mitigate an additional 3 million metric tons of CO2 equivalent and prevent 90 million pounds of nitrogen and 33 million tons of sediment from running into our waterways each year.

    “We want to make sure CRP continues to be a valuable and effective conservation resource for our producers for decades to come,” said Vilsack. “USDA will continue to find new and creative ways of putting producers and landowners at the center of climate-smart practices that generate revenue and benefit our planet.”

    CRP’s long-term goal is to establish valuable land cover to help improve water quality, improve soil health and carbon sequestration, prevent soil erosion, and reduce loss of wildlife habitat. USDA’s Farm Service Agency (FSA) offers a number of signups, including the general signup and continuous signup, which are both open now, as well as a CRP Grasslands and pilot programs focused on soil health and clean water.

    New Climate-Smart Practice Incentive

    To target the program on climate change mitigation, FSA is introducing a new Climate-Smart Practice Incentive for CRP general and continuous signups that aims to increase carbon sequestration and reduce greenhouse gas emissions. Climate-Smart CRP practices include establishment of trees and permanent grasses, development of wildlife habitat, and wetland restoration. The Climate-Smart Practice Incentive is annual, and the amount is based on the benefits of each practice type.

    Higher Rental Rates and New Incentives

    In 2021, CRP is capped at 25 million acres, and currently 20.8 million acres are enrolled. Furthermore, the cap will gradually increase to 27 million acres by 2023. To help increase producer interest and enrollment, FSA is:

    • Adjusting soil rental rates. This enables additional flexibility for rate adjustments, including a possible increase in rates where appropriate.
    • Increasing payments for Practice Incentives from 20% to 50%. This incentive for continuous CRP practices is based on the cost of establishment and is in addition to cost share payments.
    • Increasing payments for water quality practices. Rates are increasing from 10% to 20% for certain water quality benefiting practices available through the CRP continuous signup, such as grassed waterways, riparian buffers, and filter strips.
    • Establishing a CRP Grassland minimum rental rate. This benefits more than 1,300 counties with rates currently below the minimum.

    Enhanced Natural Resource Benefits

    To boost impacts for natural resources, FSA is:

    • Moving State Acres for Wildlife Enhancement (SAFE) practices to the CRP continuous signup. Unlike the general signup, producers can sign up year-round for the continuous signup and be eligible for additional incentives.
    • Establishing National Grassland Priority Zones. This aims to increase enrollment of grasslands in migratory corridors and environmentally sensitive areas.
    • Making Highly Erodible Land Initiative (HELI) practices available in both the general and continuous signups.

    Expanding Prairie Pothole Soil Health and Watershed Programs

    CRP has two pilot programs ― the Soil Health and Income Protection Program (SHIPP) and the Clean Lakes, Estuaries and Rivers 30-year contracts (CLEAR30).

    • For SHIPP, which is a short-term option (3, 4, or 5-year contracts) for farmers to plant cover on less productive agricultural lands, FSA will hold a 2021 signup in the Prairie Pothole states.
    • The CLEAR30 pilot, a long-term option through CRP, will be expanded from the Great Lakes and Chesapeake Bay pilot regions to nationwide.

    Increasing Technical Assistance Capacity and Impact Measurement

    USDA technical assistance through the Natural Resources Conservation Service (NRCS) is critical to enable producers to plan and implement conservation practices that are appropriate for their needs. To ensure increased enrollment and support for producers, USDA is increasing NRCS technical assistance capacity for CRP by $140 million.

    Additionally, in order to better target the program toward climate outcomes, USDA will invest $10 million in the CRP Monitoring, Assessment and Evaluation (MAE) program to measure and monitor the soil carbon and climate resilience impacts of conservation practices over the life of new CRP contracts. This will enable the agency to further refine the program and practices to provide producers tools for increased climate resilience.

    To learn more about updates to CRP, download our “What’s New with CRP” fact sheet.

    Partnership Programs Contribute to Priorities

    In addition to changes to CRP, Secretary Vilsack also announced significant investments for climate-smart policies. First, NRCS is investing $330 million in 85 locally driven, public-private partnerships under the Regional Conservation Partnership Program to address climate change and other natural resources challenges. NRCS will announce more details on the RCPP project selections on April 26.

    Second, NRCS is investing $25 million in proposals for On-Farm Trials, which are part of the Conservation Innovation Grants program. NRCS is seeking proposals through June 21. Project priorities include climate-smart agricultural solutions and soil health practices.

    Under the Biden Administration, USDA is engaged in a whole-of-government effort to combat the climate crisis and conserve and protect our nation’s lands, biodiversity, and natural resources including our soil, air and water. Through conservation practices and partnerships, USDA aims to enhance economic growth and create new streams of income for farmers, ranchers, producers and private foresters. Successfully meeting these challenges will require USDA and our agencies to pursue a coordinated approach alongside USDA stakeholders, including state, local, and tribal governments.

  • Governor Newsom’s Response to Drought Conditions

    With much of the West experiencing drought conditions and California squarely in a second consecutive dry year, Governor Gavin Newson today directed state agencies to take immediate action to bolster drought resilience and prepare for impacts on communities, businesses and ecosystems if dry conditions extend to a third year.

    In addition, the Governor proclaimed a regional drought emergency for the Russian River watershed in Sonoma and Mendocino counties, where reservoirs are at record lows following two critically dry years and accelerated action may be needed to protect public health, safety and the environment.

    “California is facing the familiar reality of drought conditions, and we know the importance of acting early to anticipate and mitigate the most severe impacts where possible,” Governor Newsom said. “Climate change is intensifying both the frequency and the severity of dry periods. This ‘new normal’ gives urgency to building drought resilience in regions across the state and preparing for what may be a prolonged drought at our doorstep.”

    The text of today’s emergency proclamation can be found here.

    With an extremely low Lake Mendocino as a backdrop, the Governor today announced that he is directing state agencies to work with regional and local governments – including groundwater sustainability agencies – to identify watersheds, communities, public water systems and ecosystems that may require coordinated state and local actions to address drought impacts and protect people, natural resources and economic activity.

    To encourage Californians to reduce water use and conserve supplies in case drought conditions continue next year, the proclamation also directs state agencies to partner with local water suppliers to promote conservation tips and messages through the Save Our Water campaign. The campaign and website were critical resources for Californians during the 2012-2016 drought and remain a trusted information source on using water wisely.

    The proclamation directs additional actions to coordinate with California Native American tribes; accelerate funding for water supply enhancement, conservation and species protection projects; work with counties to encourage and track reporting of household water shortages including dry residential wells; provide technical and financial assistance for water systems at risk of water shortages; support the agricultural economy and food security; and evaluate and take action to protect terrestrial and aquatic species.

    To address acute drought impacts in the Russian River watershed, the proclamation directs the State Water Board to consider modifying requirements for reservoir releases or diversion limitations to ensure adequate supplies for critical purposes. The regional state of emergency also enables flexibilities in regulatory requirements and procurement processes to mitigate drought impacts.

    Under the Governor’s direction, state agencies have been working together since November to prepare for continued dry conditions. The Governor recently formalized that coordination through the Drought Resilience Task Force, which includes the Natural Resources Agency, California Environmental Protection Agency, Department of Food and Agriculture, Department of Water Resources, Department of Fish and Wildlife, State Water Resources Control Board, Department of Finance, Governor’s Office of Emergency Services, California Health and Human Services Agency, California Public Utilities Commission and the Labor and Workforce Development Agency.

    Other recent actions by state agencies to address dry conditions include:

    • The state has launched a new drought preparedness website detailing current conditions, the state’s response and informational resources for the public.
    • The State Water Board has identified water suppliers at extreme financial risk that may need additional support due to the combined impacts of COVID and drought.
    • The Department of Water Resources (DWR) has updated its Dry Well website that tracks reports of water supply outages.
    • DWR has drafted a Drought Contingency Plan that explains how it will manage the State Water Project in a manner that protects fish and wildlife.
    • The State Water Board has issued letters to approximately 40,000 water right holders across the state, advising them to plan for potential shortages by closely managing water use.
    • Last month, DWR released a report, prepared with extensive stakeholder involvement, that evaluates the water shortage risk of more than 4,000 small water providers.
    • Informed by that report, this month the State Water Board completed its first-ever comprehensive look at California water systems that are struggling to provide safe drinking water to communities and how to help them. The assessment identifies both failing water systems and those at risk of failing, offering the most in-depth view of long-term drinking water safety the state has ever had.
    • CDFA is coordinating closely with the USDA to provide aid to growers and ranchers in the Klamath Basin, and the Department of Fish and Wildlife is working with California Native American tribes and commercial and recreational salmon representatives to manage impacts to iconic salmon in the basin.

    The 2012-2016 drought helped usher in some important water resilience policies that position the state to better handle another drought. These include:

    • Enactment in 2014 of the Sustainable Groundwater Management Act to require and empower local agencies to bring overdrafted groundwater basins into sustainable conditions by 2042.
    • Enactment of legislation to establish new standards for indoor, outdoor and industrial use of water.
    • Funding for disadvantaged communities lacking access to safe drinking water through the Safe and Affordable Drinking Water Act.
    • Increase in the frequency of water use reporting.
    • Expanded state authority to order failing public water systems to consolidate with better-run systems.
    • Tighter landscape efficiency standards for new developments.

  • Milk Cooler Bag Initiative Keeps Milk on the Menu at CA Schools Affected by COVID Changes

    California dairy farmers and processors, with the support of the California Milk Advisory Board (CMAB) and Dairy Council of California (DCC), are aiding schools in the central and southern regions of the Golden State through a pilot program that supplies California schools with portable insulated milk cooler bags to keep milk cold and remain part of school meal service.

    When the pandemic forced California schools to close their doors, many schools switched to a drive-thru service model to continue to provide meal service to students and families in their community. Drive-thru meal service is continuing despite schools opening back up, and as the weather warms, a growing concern shared by many school foodservice professionals center around challenges keeping milk cold. Milk is an important part of school meals and daily eating patterns, nourishing students and providing essential nutrients that support optimal growth and development, academic success and health.

    To solve this challenge, CMAB created and sourced custom portable cooler bags, which are heavily insulated and able to hold up to two crates of milk. Highly portable, these cooler bags can be easily moved and stored, making them ideal for in-classroom, drive-thru and outdoor meal service. Beyond the pandemic, the cooler bags will also be able to support Summer Meals, helping California schools nourish children with fresh, cold milk as part of school meal service offered during warmer summer months. The cooler bags are being distributed to schools in need to help ensure milk can stay on the daily menu.

    “School meals are an essential resource to promote healthy growth and development and support academic achievement. With the disruption of Covid, vulnerable students have faced limitations on access to healthy foods,” said Mike Gallagher, Business and Market Development Consultant for the CMAB. “By supplying California schools with cooler bags to help solve the problem of keeping milk cold, we can help ensure all children are able to access milk with their school meals.”

    “Dairy foods like milk offer a unique package of nutrients that work together to provide multiple benefits, including optimal growth and development in children and reduced risk of developing chronic disease such as type 2 diabetes and heart disease,” said Shannan Young, RDN and Program Director of Food Systems and Access at DCC. “Access to milk and dairy foods as part of a healthy eating pattern is especially important in underserved communities and during early childhood, since nutrition and diet quality can positively impact lifelong health.”

    Three California processors took part in the test –Producers Dairy Foods, Crystal Creamery and Hollandia Dairy – to help fund and distribute approximately 5,000 cooler bags for schools in the central and southern part of the state. Distribution by these processors will continue until the supplies are exhausted in the districts of the pilot program.

    California is the nation’s leading milk producer and is responsible for producing more butter, ice cream and nonfat dry milk than any other state. The state is the second-largest producer of cheese and yogurt. California milk and dairy foods can be identified by the Real California Milk seal, which certifies they are made exclusively with milk from the state’s dairy farm families.

    About Real California Milk/California Milk Advisory Board

    The California Milk Advisory Board (CMAB), an instrumentality of the California Department of Food and Agriculture, is funded by the state’s dairy farm families who lead the nation in sustainable dairy farming practices. With a vision to nourish the world with the wholesome goodness of Real California Milk, the CMAB’s programs focus on increasing demand for California’s sustainable dairy products in the state, across the U.S. and around the world through advertising, public relations, research, and retail and foodservice promotional programs. For more information and to connect with the CMAB, visit RealCaliforniaMilk.com, Facebook, YouTube,Twitter, Instagram and Pinterest.

    About Dairy Council of California                                                                                              

    For over a century, Dairy Council of California has empowered stakeholders, including educators, health professionals and community leaders, to elevate the health of children and families through the pursuit of lifelong healthy eating habits. Funded by California’s dairy farm families and local milk processors and under the guidance of California Department of Food and Agriculture, Dairy Council of California’s free science-based nutrition education resources, Mobile Dairy Classroom assemblies, training programs and online resources educate millions of students and families in California and throughout the United States. Learn more at HealthyEating.org.

  • Reforming Market Access in Agricultural Trade

    The Uruguay Round Agreement on Agriculture (URAA) and the founding of the World Trade Organization (WTO) in 1995 led to new rules in the areas of market access, domestic support, and export subsidies. Despite substantial growth in agricultural trade since 1995 (243 percent in 2018, in nominal terms), market access is still limited, in particular by high agricultural tariffs (relative to nonagricultural products). The goal of further negotiations has been to continue the process of agricultural policy reform begun in the URAA, and some progress has been made in the Trade Facilitation Agreement (TFA). However, while the number of bilateral and regional trade agreements (RTAs) that grant market access on a preferential basis has increased, multilateral negotiations have slowed.

    As an aid to understanding the potential benefits of improved market access, this report provides a quantitative analysis of two scenarios: completely removing all agricultural tariffs or reducing agricultural trade costs in the context of TFA implementation. For each of these reforms, we report resulting changes in trade, production, prices, and welfare (societal well-being). 

    What Did the Study Find?

    The analysis of the two reform measures indicates that each scenario, if undertaken separately, would increase global agricultural trade. However, removal of agricultural tariffs would result in larger trade gains and welfare improvement than implementing the TFA agreement.

    Scenario 1: Removal of Agricultural Tariffs

    • Removing agricultural tariffs is projected to lead to a global increase in trade value of 11.09 percent. This is close to the average global tariff on agricultural products (10.33 percent).

    • The removal of agricultural tariffs is estimated to lead to increases in the value of total agricultural exports and imports for all regions except the European Union. By commodity type, increases are projected for all sectors except live animals.

      • °  Rice, beef, and other meats (mainly poultry and pork) would experience the largest increase in export trade value, as removal of their relatively high average global tariffs would reduce the resulting larger barriers to trade.

      • °  A projected decrease in the EU’s exports is largely due to a estimated increase in its imports of beef and other meats—commodities for which the EU has large tariffs in place. The increase in imports displaces domestic production, leading to less product to export. 

    • The region with the highest tariffs, India, is also the region with the largest estimated increase in agricultural imports.

    • Changes in production due to tariff removal are mixed, with just over half of the regions projected to undergo a decrease as production shifts to more efficient producers. The regions that would experience production declines tend to be those with the highest tariffs in place; some regions cite protection of agricultural employment and food self-sufficiency as reasons for retaining their tariffs.

    • Tariffs act as a tax on imports, and removing them leads to a reduction in the market price for many commodities. Of the 20 regions in the model, 12 are projected to see a reduction in the average price for all agricultural products, which would help bolster food security by reducing consumer prices.

    • Global welfare is projected to increase by $56.3 billion annually if all tariffs are removed (this is
      a little more than 2 percent of the global value of the agricultural sector). The EU would have the largest increase in welfare due to its reallocation of resources from commodities with high tariffs (and low productivity) to other uses. The results indicate some welfare improvements from nonagricultural sectors, but most of the increase is related to agriculture.

      Scenario 2: Implementation of the Trade Facilitation Agreement for Agriculture (with nonagriculture not considered)

    • All regions except for Argentina would have an increase in aggregate agricultural export trade values in the TFA scenario.

      • °  Reducing trade costs through the TFA could increase agricultural trade value by 7.27 percent.

      • °  The TFA scenario finds that low-middle-income regions would have the largest export gains from more streamlined release and clearance of agricultural goods.

      • °  Like the tariff-removal scenario, meats are projected to have the largest gains in export value, but milk products and rice also benefit. Trade in these commodities stands to increase because they tend to have high tariffs, and demand for meats and milk products is responsive to income growth resulting from falling commodity prices.

    • A double-digit increase in aggregate imports is projected for all regions, above 20 percent for most.

    • Most regions have a decrease in aggregate agricultural production. Increases only occur for Brazil, the non-EU part of Europe, Indonesia, and “AgExp” (which consists of countries among the top 20 global agricultural exporters as of 2014 that do not appear in another group). Each of these four regions specializes in the production/export of certain commodities, which leads to the increase of the commodities in aggregate production.

    • The estimated increase in global societal welfare of $42.9 billion annually is largely due to lower consumer prices for imports of commodities in the EU. A larger proportion of welfare gains from the TFA scenario accrue to nonagricultural sectors compared to the tariff-removal scenario.

      How Was the Study Conducted?

      The study analyzes two agricultural trade policy scenarios using a modified version of Global Trade Analysis Project’s (GTAP) static computable general equilibrium (CGE) model with the GTAP v.10 2014 database (the latest GTAP data available). A CGE model is a large system of equations and data that links commodities, regions, and economic agents together to calculate the potential impacts of a change in policy. To allow for more precise analysis of the agricultural sector, the analysis disaggregates agriculture into 16 commodities and 20 regions, some consisting of individual countries and others of a group of countries. The model is referred to as ERS-GTAP, and the results are given in percentage changes except for welfare, which is reported in dollars. Effects from trade are in terms of changes in relative values, not in volume.

      Read the entire report by Jayson Beckman from the USDA Economic Research Service HERE.

  • Two New Races of Downy Mildew in Spinach

    Two new races of the downy mildew pathogen (Peronospora effusa) on spinach have been denominated by the International Working Group on Peronospora in spinach (IWGP) on the basis of a worldwide evaluation of isolates from growers fields and trap nurseries. Isolate SP1924 found in Europe, is denominated as race Pe: 18. Isolate UA202001E, found in the USA, is denominated as race Pe: 19. Both races pose a significant threat to the spinach industry in all parts of the world, and resistance to these new races is important.

    Members of the IWGP are using a fixed set of spinach differentials (with different resistances)  to define races of downy mildew on spinach by their pattern of virulence on the set. The virulence patterns of all races are published as reference data by the International Seed Federation (ISF); https://www.worldseed.org/our-work/plant-health/differential-hosts/

    Race Pe: 18 is able to infect the differentials NIL2, 3, 4, 5, Pigeon, Caladonia, and Meerkat. Pe: 18 has been found in the US in 2015 to 2018, not in 2019 and 2020. And in Europe it has been found more often in the last 3 years. Race Pe: 19 is able to infect the differentials NIL1, 2, 4, 5, 6, Pigeon, Meerkat and Hydrus. Pe: 19 has been reported only from the USA until now.

    The IWGP is continuously monitoring the appearance of strains of the pathogen that deviate in virulence from the known races. In this way the IWGP aims to promote a consistent and clear communication between public and private entities, such as the seed industry, growers, scientists, and other interested parties, about all resistance-breaking races that are persistent enough to survive over several years, occur in a wide area, and cause a significant economic impact.

    The IWGP is operating internationally and is administered by Plantum located in The Netherlands. The IWGP consists of representatives from spinach seed companies (BASF, Bayer, Bejo, DeSeed, Enza, Pop Vriend, Rijk Zwaan, Sakata, Syngenta, Takii, and Vilmorin) and Naktuinbouw, and is supported by public research at the University of Arkansas. Spinach researchers over the world are invited to join the IWGP initiative and use the common host differential set to identify new isolates. All denominated isolates and seeds of the differential set are available at Naktuinbouw (The Netherlands)

    For more information on this subject, please contact Jim Correll (jcorrell@uark.edu), Diederik Smilde (d.smilde@naktuinbouw.nl), or the IWGP chairperson Anne Königs (a.konigs@rijkzwaan.nl)

    Table with disease resistance reactions of spinach downy mildew races on IWGP differentials. Differentials and type isolates are available at Naktuinbouw in The Netherlands.

  • Map Shows 2021 California Farm Water Supply Cuts

    California farms are bearing the brunt of this year’s short water supply and have been forced to reduce the acreage of popular California crops, such as asparagus, melons, lettuce, rice, tomatoes, sweet corn, and others.

    Water supply reductions mean fewer fresh fruits and vegetables for consumers, massive farm-related job losses, and billions in lost economic activity, impacts that go beyond rural and disadvantaged communities.

    About 2 million acres of California’s irrigated farmland, or one out of every four acres, has already had its water supply cut by 95 percent. Another million acres has lost 80 percent of its water supply this year with much of the remaining farmland experiencing cuts of 25 percent or more.

    Conditions are similar to those that occurred in 2015. According to a 2015 drought report issued by UC Davis, ERA Economics, and the UC Agricultural issues Center, water supply cuts led to the fallowing of 540,000 acres of farmland, 21,000 lost jobs, and an economic loss of $2.7 billion.

    Critical reservoirs, including Shasta, Oroville, Folsom, Millerton, and San Luis combined have 1.1 million acre-feet less water in storage today than they had at the end of March in 2015, California’s last critically dry year. Levels in these reservoirs are currently at 56 percent of average, compared to 72 percent of average at this time in 2015. They are essential to supplying rural communities with drinking water, irrigating farms, supplying water to wildlife refuges, and recharging aquifers in the Sacramento and San Joaquin valleys where a majority of California-grown food products originate.

    It is a distressing time for farmers, farm workers, and businesses that depend on agriculture all across California and illustrates the need to invest in infrastructure that will increase our ability to capture more water during wet years when it is abundant to save for dry years like this. It also puts a strain on consumers who want local, California-grown fresh food choices for their families.

  • Western Growers Launches Global Harvest Automation Initiative

    Western Growers (WG) is spearheading a Global Harvest Automation Initiative (GHAI) to accelerate harvest automation across the fresh produce industry, with a goal of automating 50 percent of harvest within 10 years.

    “For well over a decade, our members have struggled with a dwindling number of available workers. If we don’t come together as an industry to quickly and efficiently deliver automation solutions for farmers in this country, it is likely that the shift of fresh produce operations to other countries will dramatically increase,” said Western Growers President and CEO Dave Puglia. “The Global Harvest Automation Initiative is aimed directly at this challenge, and the alignment of so many industry leaders and partners in this endeavor is a strong indicator of our shared commitment to success.”

    The global initiative is comprised of several key projects uniquely designed to solve the ag industry’s labor woes while simultaneously helping harvest automation start-up companies commercialize and scale at a more rapid pace:

    Technology Stack: A documented set of technical interfaces that will help startups leverage industry-standard components so their robots can get into fields and markets faster.

    • Harvest Automation Cohort: A cohort of automation startups will be selected based on industry input to receive exclusive access to systems integration to help integrate the tech stack into their product roadmap, strategy for go-to-market support, field trials and case studies.
    • Impact Report: A comprehensive analysis on the impact of harvest automation on the specialty crop industry will be provided annually based on grower metrics.
    • Harvest Automation Traction Roadmap: A list of current harvest automation startups by crop type and in-market progress/traction will be distributed regularly.The technology stack will be built by a team of subject matter experts(SMEs) in ag and robotics:
    • precision ag companies (Trimble, Bosch)
    • original equipment manufacturers and platform companies (Ramsay Highlander, Oxbow and SPUDNIK)
    • AgTech engineering companies (Milano Technical Group, All-Phase Agricultural Engineering, Red Rooster Engineering and NWFM LLC)
    • WG members that are among the world’s largest and best farming operators at adopting new technologies (Grimmway Farms, Turlock Fruit Company, Church Brothers Farms, Superfresh Growers and Illume Agriculture)The SME group will build a set of documented interfaces so startups can connect to tractor manufacturers like John Deere, sensor manufacturers like Bosch, navigation equipment providers like Trimble, and other manufacturing partners.The Washington Tree Fruit Research Commission (WTFRC) has been a key partner for WG in supporting the GHAI by providing recommendations for SMEs and harvest startups with traction based on WTFRC’s 52 years of experience with tree fruit innovation. In addition, WTFRC has committed $200,000 in funding over three years to support the overall GHAI initiative.“The specialty crop industry needs to all work together to solve harvest automation by strategically accelerating the speed of innovation and adoption,” said Dr. Ines Hanrahan, executive director for WTFRC. “The platform approach Western Growers is taking is supported by both startups and industry as the best path forward to finally achieve this goal.”

      WG held a hybrid in-person and virtual event on February 11, 2021, in Tulare, Calif., to announce the official launch of the Global Harvest Automation Initiative. Resources and detailed information about the GHAI can be found on the WG Center for Innovation & Technology webpage here.

      About Western Growers:

      Founded in 1926, Western Growers represents local and regional family farmers growing fresh produce in California, Arizona, Colorado and New Mexico. Our members and their workers provide over half of the nation’s fresh fruits, vegetables and tree nuts, including nearly half of America’s fresh organic produce. Some members also farm throughout the U.S. and in other countries so people have year-round access to nutritious food. For generations, we have provided variety and healthy choices to consumers. Connect and learn more about Western Growers on our Twitter and Facebook.