Agriculture is bright spot in California economy

FRESNO, Calif. (AP) — There is a bright spot in the economy of California and elsewhere in the nation, and it is agriculture.

As counties across the Golden State begin releasing annual reports on crop revenues, they show prices earned for many commodities are setting records, and not just by a little.
Across Central California's San Joaquin Valley, the region with the highest farm revenues in the nation, gross crop values showed overall income increases of about 15 percent, a figure tempered as farmers struggle with higher fuel and feed costs.

"The American brand of agriculture is surging in popularity worldwide," said U.S. Secretary of Agriculture Tom Vilsack, adding that net farm income nationwide reached an all-time high of more than $98 billion behind U.S. farm exports totaling $137.4 billion.

Vilsack said that the current drought is hurting growers across the Midwest, and many have predicted that shortages of feed corn will drive up the cost of everything from chickens to milk.

Still, demand for U.S. agricultural products worldwide is strong, and figures from the USDA show that the value of California's agricultural exports grew to $21.1 billion in 2011, up from $18.2 billion in 2010.

Prices reflect a growing demand for almonds in a region that produces 80 percent of the world's supply, and table grapes, which were competed for by both raisin packers and wineries that suffered weather-related shortages in 2011.

The higher revenues are coming as farmers expand almond and citrus production to meet export demands generated, in part, from key new trade agreements.

"Our agricultural economy is connected to the rest of the planet," said Dan Sumner, an agriculture economist at the University of California-Davis. "Poorer countries around the world are turning into middle-income countries and they want fruits and vegetables, which we do well here."

Even with a 38 percent drop in revenues from avocados, which produce every other year, the value of crops in coastal Ventura County decreased only 1 percent behind strong sales of strawberries, up 15 percent, and raspberries, up 11 percent from 2010.

In Tulare County, with more than 800 dairies, milk helped revenues rise 16 percent to $5.6 billion, its 2011 crop report says. Madera, San Joaquin and Kings counties also set records. Fresno County has not yet completed its 2011 crop report, but officials in the agricultural commissioner's office are expecting to continue the upward trend.

More than 12 percent of the nation's agricultural output comes from California, and most of that comes from the long and narrow San Joaquin Valley that stretches across the middle of the state. Table grapes, bulk wine grapes, raisins, dairies, almonds, pistachios, citrus and canning tomatoes dominate the landscape. And in the specialty crop realm, Stockton produces most the nation's domestic asparagus.

Yet in spite of its agricultural productivity, the valley has a growing hunger and poverty rate. As agriculture revenues have risen, the fortunes of those who work the fields have not. Recent reports show the poverty rate in Fresno County, which produces more than $5.6 billion in agricultural products, is at more than 25 percent, the second highest in the nation.
Four out of the 10 top metropolitan regions with the highest poverty rates are in the areas that last year set records for agriculture income.

"During this recession, and even before this recession, there has been a disconnect between the wealth of agriculture versus the poverty of the people who work in agriculture," said Carolina Farrell, executive director of the Center on Race, Poverty & the Environment. "This has been a persistent trend highlighted by this increasing inequality."

via Businessweek.com