While some urban dwellers and businesses might see a simple solution to the drought – simply take water from agriculture – those who labor in the massive food supply chain, all the way from farm to fork, likely have a different opinion: that taking water or pricing it in a way that squelches profitability, is already hurting or threatening tens of thousands of urban workers across Los Angeles.
City businesses and farmers remain closely linked by a common, critical challenge: economic well-being. Farms feed the cities. But more than that, agriculture supports urban jobs and economic prosperity, provides local food sources that communities prefer, preserves open space and offers environmental benefits.
How many jobs are at stake if agriculture shrinks? Southern California’s farm gross revenue exceeds $9 billion annually, in the top 10 among all states. Agricultural industries – including farming, support activities, food processing, wholesale distribution, retail markets and foodservice – produced $48 billion in sales and directly employed 160,000 workers in 2010, according to a recent study from the University of California Agricultural Issues Center at Davis.
This Southern California bounty is dominated by fruit crops, with strawberries (nearly $1 billion) and avocados ($400 million) leading the way. Dozens of other crops exceed $200 million. According to the study, farming alone produced $9 billion in sales and employed 40,000 people. “Accounting for the ripple effect,” the study indicates, “agricultural industries generate about 450,000 jobs, $25 billion in labor income and $42 billion in value added” in the region.
Here are some other important questions: What if the drought continues indefinitely? What if California’s troubled water-delivery system continues to restrict traditional flows to Southern California? What if water rates to farmers keep escalating until they reach an unsustainable level that causes farms to shut down?
These are not merely hypothetical questions. Ivan Munoz is sales and import manager at Cal Pacific Growers near the Wholesale Produce Market in downtown Los Angeles. He sees the problem expanding as growers “stump” trees because of a lack of water. “When that happens,” Munoz said, “there is less fruit coming to Los Angeles. When previously we may have added staff to handle the volume, that won’t be happening this year.”
Munoz sees a drop especially among smaller mom-and-pop businesses: “There are two or three dozen core companies at the produce market that are finding ways to weather the changes. But smaller businesses – those that often stay open late on Saturday and open on Sunday, get less produce because they have less buying power.”
While this effect is alarming enough, Joe Del Toro Jr., president of Pan American Banana, traces the impact even further. He says less planting because of water supply issues means fewer fruits at higher cost all the way down to the retail and foodservice level all over Los Angeles.
“I have a good customer who distributes to small grocery chains and restaurants,” he said. “His normal order of 10 to 15 pallets a week has now become four to six in response to rising prices and lack of produce availability.”
Del Toro said that less fruit into Los Angeles also reduces tax revenues for the city, since the city collects a tariff of 1.5 percent of gross billings.
So not only does a reduction in agricultural output affect jobs in distribution and retail businesses as well as tax revenue, it also lessens the availability of the locally grown produce that communities prefer.
The solution to the twin threats to our region’s farming economy – dwindling water supply and rising rates – must involve both rural and urban communities. Residents and businesses must realize that a decline in agriculture can result in higher costs to them. They can also vocally support the job creation that farming and growing provide to their urban neighbors in the food processing and distribution services industries.
High-tech irrigation systems are rapidly becoming the norm in the field and that should continue. Water agencies should recognize agricultural customers as good customers worth preserving and work to strengthen them by adjusting agricultural water rates. Such rates would help farmers and have an almost negligible effect on urban customers.
Our business community must understand in the first place that the threat to agriculture is real and can affect everyone’s business in one way or another. As the UC Davis study, called “Contributions of Agriculture,” concludes: “Agriculture remains a vital part of the Southern California economy, accounting for hundreds of thousands of jobs, billions of dollars of economic activity, and substantial tax revenues while providing open space, visual amenities and an important link for the increasingly urban population to its food and agricultural roots.”
Tom Bellamore is the president of the California Avocado Commission, which represents avocado growers in Southern California.
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