Drought in the West Brings Risk of Food Inflation Across the U.S.

This article originally appeared in Presence Marketing’s July 2021 Industry Newsletter

By Steven Hoffman

California produces 80% of the world’s almonds, but it is a thirsty crop. Almond production is California’s most valuable crop, and it accounts for 80% of the state’s water use. 

However, after a warm spring that dried up nearly all of the Sierra Nevada’s snowpack, the drought in the state is now so extreme and water so scarce in California’s Central Valley that almond farmers are ripping out trees or being forced to let portions of their acreage go dry, reported Bloomberg. With water levels of more than 1,500 reservoirs in California at 50% below normal for this time of year, “It’s a stark reminder of the devastating toll that the drought gripping the West will take on U.S. agriculture, bringing with it the risk of food inflation,” wrote Bloomberg journalist Elizabeth Elkin. 

It’s a concern for the whole nation, as the Golden State’s 69,000 farms and ranches provide more than a third of all vegetables and two-thirds of all fruit in the U.S. 

California Gov. Gavin Newsom has put 41 counties under a state of emergency in an attempt to drastically limit water use. State authorities have been forced to cut water allocations for farmers, too, sometimes to zero, while water transfers have been delayed and farmers are being prevented from pulling water out of their neighboring rivers. 

As a result, a growing number of farmers are abandoning crops that require too much water, such as almonds. One grower, Fowler Brothers Farm in Snelling, California, tore up 600 acres of almond orchard to make room for crops that require less water, reported The Weather Channel. 

Farm workers, too, are at risk from extreme heat, adding stress, dehydration, heat stroke and other heat-associated health risks to already grueling work, reported Bloomberg. U.S. farmworkers face a 35-fold risk of heat-related deaths compared to that of the general work force, Bloomberg, reported, and temperatures this summer are hitting triple digits in swaths of California and the West. According to researchers at Emory University, laborers on farms are often chronically dehydrated, even if they drink enough water during their workday, and worker’s body temperatures often rise above 100.4 degrees Fahrenheit, meaning they run a fever all day. The additional weather-related dangers farm workers face could add to labor shortages in an industry already struggling to attract employees. 

Climate change is not just affecting crops in the United States – according to Bloomberg Green, Brazil, the world’s largest exporter of coffee, sugar, and orange juice, saw little rain during its rainy season and water reserves are running so low that farmers are concerned they may run out of water before harvest. In recent years, Bloomberg reported, drought has impacted wheat growers in Europe and livestock producers in Australia. 

According to research led by Cornell University and published in April 2021 in the journal Nature Climate Change, “Despite important agricultural advancements to feed the world in the last 60 years...global farming productivity is 21% lower than it could have been without climate change. This is the equivalent of losing about seven years of farm productivity increases since the 1960s.” The UN Food and Agriculture Organization also warns that traditional food gathering techniques of indigenous communities throughout the world are under threat from accelerating climate change and economic pressures, reported Global Banking and Finance Review. 

The drought and extreme weather come at a time when the world is already experiencing the highest grocery costs in a decade, global hunger is on the rise, and countries are still reeling from the economic and health-related shocks of the COVID-19 pandemic. And, as drought begets drought, in an early warning sign of rising food costs, avocados cost about 10% more than last year, Bloomberg reported. “That could mean that prices for nuts and even products like almond milk could increase down the road if harvests continue to be constrained,” said writer Elizabeth Elkin. 

The issue is large enough that comedian Bill Maher, host of HBO’s Real Time, said on a recent episode, “The Bay Area was just placed under a water shortage emergency with mandatory restrictions. Except, here's the thing, there isn't – even with the drought – really a shortage problem. It's more a, 'where the water is going' problem. California agriculture accounts for 80% of our water use, even though California agriculture is less than 2% of our economy," said Maher. 

"We actually have enough water, we give away too much of it to farmers who get their water subsidized by the government because we still act like it's 1890 and farmers are small and independent when they're really mostly part of Big Ag," he added.