California drought hits hard

Food prices expected to climb as growers forced to cut back production

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With 2013 the driest year on record and 2014 possibly worse, the devastation of California's drought is trickling down to crops, fields, farmers markets, grocery stores — and the kitchen table.

While it's too early to tell precisely how much the drought will push up household grocery bills, economists say consumers can expect to pay more for food later this year because fewer acres of land are being planted and crop yields are shrinking.

Large grocery chains have distribution networks and can import produce from around the world to keep customers in everything from cantaloupe to cauliflower, but experts say California's smaller yields will inevitably lead to higher consumer prices there and elsewhere. Some consumers already are plotting ways to keep their food budgets under control if there is a big spike in prices.

"The first thing I would cut back on is eating meat," retired schoolteacher Sharon Jay, 66, said as she shopped for pears and asparagus at a Safeway in Oakland, Calif. "And I wouldn't go out to eat very often. If food costs go up, restaurant meals will cost more, too."

Jim Cochran of Swanton Berry Farm in Davenport, Calif., offers a hint of what may come. He stopped watering his artichokes a month ago and expects the cost of a pint of organic strawberries, which usually sell for $3.50 at San Francisco Bay Area farmers markets, to go up roughly 20 percent to at least $4.20 a pint.

"We are going to have to sell our products for higher prices because we are not going to have the yield," Cochran said. "We're not trying to make more money; we're trying to lose less."

California is the nation's largest producer of many fruits, vegetables and nuts. But with the traditional rainy season more than half over, farmers are making hard decisions about what crops to plant and how many acres to leave fallow. At least 500,000 prime acres, representing an area the size of Los Angeles and San Diego combined, are expected to go unplanted this spring because of insufficient water.

"We're really concerned about the extent to which acreage is being taken out of action," said Richard Volpe, an economist in the Foods Markets Branch of the U.S. Department of Agriculture. "The real economic impact is long

term and will be felt down the road, when there will be a structural shift in prices."

Besides being the nation's leading wine and dairy state, California produces 80 percent of the world's almonds and is a major producer of strawberries, walnuts, celery, leaf lettuce, spinach and cattle. The $45 billion agriculture sector includes 2.6 million acres of permanent crops like almonds and grapes, which allow farmers less flexibility in tough times.

"There will be thousands of acres of fruit and nut trees that will die this year because of lack of water," said David Sunding, a professor in the College of Natural Resources at the University of California-Berkeley. "The reduction in yield will drive up prices."

But Mike Wade, executive director of the California Farm Water Coalition, said the precise impact on consumers is difficult to gauge because other states and countries might increase production of the crops that California farmers cut back on.

"We're not expecting to see much in terms of spring planting of peppers and melons," said Wade. "But planting may be ramped up somewhere else. It could be grown in Arizona or Mexico."

Full Belly Farm, a 350-acre organic farm in Yolo County's Capay Valley, is cutting back on water-intensive crops like corn and melons, which means that there will be less variety at nearby farmers markets. And the lack of rain has forced growers to spend money fighting another intrusion: wildlife. Deer and wild pigs are increasingly coming onto the farm in search of food, and Full Belly expects to spend $20,000 this year just on fencing.