Drought in California may spark rise in prices

Associated Press

Monday, January 26, 2009

Mendota, Calif. —- Consumers may pay more for spring lettuce and summer melons in grocery stores across the country now that California farmers have started abandoning their fields in response to a crippling drought.

California’s sweeping Central Valley grows most of the country’s fruits and vegetables in normal years, but this winter thousands of acres are turning to dust as the state hurtles into the worst drought in nearly two decades.

“Lettuce comes off the field and goes straight into the market, and if there’s nothing coming off the field then the marketing chain goes dry, and prices go up,” said Gary Lucier, an agricultural economist with the U.S. Department of Agriculture’s Economic Research Service.

While the dry weather has exacerbated the problem, farmers’ water woes are not all drought-related.

Supplies for crops and cities also have been restricted by several court decisions cutting back allocations that flow through a freshwater estuary called the Sacramento-San Joaquin Delta, the main conduit that sends water to nearly two-thirds of Californians. Environmental groups and federal scientists say the delta’s massive pumps are one of the factors pushing a native fish to the brink of extinction.

Last year, federal water deliveries were just 40 percent of normal allocations, fallowing hundreds of thousands of acres and causing nearly $309 million in crop losses statewide. Gov. Arnold Schwarzenegger declared a disaster and ordered state water managers to expedite requests to move water so high-value crops like wine grapes, almonds and pistachio trees would stand a chance of surviving.

Federal reservoirs are now at their lowest level since 1992. And depending on how much it rains this winter, federal water supplies could be slashed to nothing this year.

“The consequences are expected to be pretty horrible in terms of farmers’ revenue, but what’s really disconcerting are the possible job losses,” said Wendy Martin, who heads the state Department of Water Resources’ drought division. “Those communities that can least weather an economic downturn are going to be some of the places that are hit the hardest.”

Richard Howitt, a professor of agriculture economics at the University of California, Davis, estimates that $1.6 billion in agriculture-related wages, and as many as 60,000 jobs across the valley, will be lost in coming months due to dwindling water.

In the meantime, meteorologists are predicting a dry spring, and a new state survey shows the population of threatened fish is at its lowest point in 42 years, more imperiled than previously believed.



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