Ag industry to face years of impact from pandemic

California farms, ranches and agricultural businesses will sustain pandemic-related losses of between $5.9 billion and $8.6 billion this year, according to a study highlighted by the California Farm Bureau Federation on Tuesday.

“The impact of the COVID-19 pandemic on California agricultural businesses was severe, unprecedented and will continue to affect the industry for the coming months and years,” read a statement in the study conducted by the Davisbased ERA Economics.

The pandemic impact on California’s nut industry, which includes walnuts and almonds -- the top commodities reported in Yuba and Colusa counties, according to 2018 crop reports -- is estimated between $486 and $728 million this year.

The report said, “given the shortage in the world rice market and increases in retail demand that have resulted in a projected increase in rice production, coupled with a price increase,” pandemic impacts on the rice industry -- Sutter County’s largest crop according to the 2018 crop report -- will be modest.

The analysis says the state’s agricultural sector has already suffered $2 billion in losses so far, from disrupted markets and rising production costs related to the COVID-19 outbreak.

“Financial impacts of the pandemic vary widely among different parts of the agricultural economy, the study says, depending in part on how much a particular crop or commodity relies on sales to food service and how much it has been affected by shifts in retail demand and changes in costs of production and processing,” read the release.

The study was commissioned by a coalition led by the California

Farm Bureau Federation and also included Unitedag, Ag Association Management Services Inc., the California Fresh Fruit Association, California Strawberry Commission, California Tomato Growers Association and Western Plant Health Association.

Analysts looked specifically at 15 different agricultural sectors, using data on production, exports and prices through early May, plus interviews and surveys of people and businesses. The study showed the greatest dollar-loss impact to dairy, with estimates of $1.4 billion to $2.3 billion; grapes, with estimates of $1.5 billion to $1.7 billion; and flowers and nurseries, with estimates of $660 million to $740 million.

“California farmers, ranchers and their employees have continued the essential work needed to keep American families fed, but that work has come with sacrifice,” said CFBF President Jamie Johansson. “The impact is being felt in rural communities throughout the state that rely on agriculture for their residents’ livelihoods. We want legislators and regulators to bear that in mind and avoid making farming even more costly and difficult in California.”

The report also states that farms, ranches and related businesses have incurred higher operating costs for measures intended to increase employee health and safety, and in the logistics required to move crops and commodities to market.

The full “Economic Impacts of the COVID-19 Pandemic on California Agriculture” report can be found at www.cfbf.com/covid-19-study.