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March 3, 2014
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Western water shortage could bump up food prices

A shortage of snow and water in the mountains and on agricultural lands of California could lead to higher food prices in grocery stores later this year.

Prices are predicted to go up, especially for California-grown fruits and vegetables because fewer acres will be planted, plus irrigation water will be more expensive for farmers to buy.

Even though storms dampened California last week, the snowpack in the Sierra Nevada mountain range still measured only about 25 percent of normal.

“I haven’t seen much (of an increase) yet, but I’m anticipating there’ll most likely be because of the produce that may or may not be available,” said Steve Rolston, manager of the Sherm’s Thunderbird Market in Roseburg. “It just makes sense that prices will go up.”

Tami Quamme of Sutherlin shops for a family of five. She said she hasn’t noticed any price increases yet, but she has heard plenty of talk about the possibility.

“I have to feed my kids,” she said. “I’ll rearrange my budget and try to buy what is in season and on sale and on coupons, but I’ll spend more if I have to.”

Shopper Heather Williams of Roseburg said she always pays attention to prices, but admitted she’ll just have to pay the increase on some preferred items such as milk.

If fewer acres are planted in California’s agricultural salad bowl, Rolston said produce buyers will purchase products from other areas. But he explained those areas are farther away so transportation costs will increase and could be passed onto to the consumers.

“Our produce buyers will buy food wherever they can get it and at the cheapest price they can find,” Rolston said. “They do a pretty good job of taking care of the needs of the consumers.”

If row crops are not planted in California this spring, any supplemental water could be sold to orchard farms to keep their trees alive during hot summer days. That extra expense could then eventually drive up the price of those crops.

A water shortage in the West could also result in less alfalfa being grown. That forage is a high water user and is an important food for dairy cows. So whether there’s less alfalfa or added expense to irrigating it, the cost will be passed along to dairies.

Steve Feldkamp, chief operations officer at Umpqua Dairy Products in Roseburg, said while water is a factor, the minimum price paid for raw milk from the dairies is determined by the federal government. He said that price has risen in each of the past 11 months and “is as high as it’s ever been.”

Feldkamp said the drought in California is one factor, but harsh winter weather in the Midwest and East and a big increase in exports have resulted in a shortage of raw milk in the U.S. to make butter, cheese and other dairy products. He said while a milk war in Roseburg is keeping milk prices steady at the bigger stores, eventually the increases will be passed onto the consumer.

“I don’t have a good crystal ball. I don’t know what is going to happen, but prices could go up,” he said.

Rolston said he didn’t know when or by how much, but that he was told a price increase on milk and other dairy products was coming.

The drought in the eastern U.S. a couple years ago and now the drought out West have kept beef prices up, according to Kurt Spencer of Umpqua, a rancher who has cattle operations in several western states.

“California is a disaster area,” Spencer said. “My trucks moved calves out of California early.”

He said cattle were moved to feedlots in December, January and February because there was an expense to feeding them instead of the animals grazing on free grass. He added that some ranchers have decreased their herds, which could result in a beef shortage and higher prices. He said the cattle shortage is an international situation.

“The market is going to be tested,” the rancher said. “Beef hit all-time (price) records three weeks ago and then sagged back a little bit. But by next fall with the supply down, I could see prices getting high again.”

Walt Gayner, a Roseburg real estate broker with a small ranch operation, said there has been interest in Douglas County ranch properties by parties both in and out of the area.

“I can’t tie it to water, but maybe the shortage elsewhere is increasing people’s motivation to look,” Gayner said. “The mild winters here, there’s still available water for irrigation, the grass growth through the seasons makes this a desirable place for agriculture, whether it’s for livestock pasture, alfalfa or grapes. You won’t get land for cheap, but it’s a possibility.”

Evan Kruse of Kruse Farms in the Garden Valley area said that the water situation for his family’s farm looks to be about the same as last year at this time. That would allow the farm to plant all of its fields. He said the farm will continue to focus on fruits and vegetables to sell through its roadside market. He explained, however, that some products the market has purchased in the past from California because the farm can’t grow them may increase in price to where the market won’t buy them this year.

“Water is expensive, irrigating is expensive, but we’ll try to be as efficient with water as possible,” he said.

Quamme said that her family likes to eat fruits and vegetables, and if store prices on those items go up, she would make more trips to and purchases at roadside farm markets and the weekly farmers’ markets than she already does.

“I’ll just be shopping more carefully,” she said.

• News-Review business reporter Craig Reed can be reached by calling 541-957-4210 or by email at creed@nrtoday.com.


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The News-Review Updated Mar 3, 2014 12:00PM Published Mar 4, 2014 04:15PM Copyright 2014 The News-Review. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.