530-993-4379
Sierra Booster
  • Home
  • Newspaper
    • Latest News
    • Letters to the Editor >
      • Submit Letter to the Editor
    • Old News Archive
    • Photo Tour
    • Events
    • About Us
    • SUBSCRIBE
  • Advertiser Directory
    • Advertiser Press Releases
    • Website Sponsors
    • Advertiser Area
  • Buy Ads - Services
  • Fishing Report
  • Contact Us
  • Admin Log In

Conversion to Organics Could Increase Food Prices,Shrink Farm Profits

11/21/2022

0 Comments

 


 
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.
 
The California Farm Bureau works to protect family farms and ranches on behalf of nearly 29,000 members statewide and as part of a nationwide network of 5.3 million Farm Bureau members. 


###



View as Webpage
0 Comments



Leave a Reply.

    Archives

    March 2023
    February 2023
    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    April 2014
    September 2009

    Categories

    All
    2015
    Sierra County News

    RSS Feed

    Vie
    ​w Old News

CONTACT US:

Sierra Booster Newspaper
PO Box 8
Loyalton, CA 96118
Phone: 530-993-4379
Fax: 844-272-8583
Email: jbuck@psln.com

Website Privacy Policy​
Picture
Local Weather
©Copyright Sierra Booster - Sierra County News - Editorial
Website by Chamber Nation