Monterey County ag reports a 9.5% drop in crop value

Crop production value in Monterey County was down $449 million in 2016, a drop of nearly 10 percent and a signal of various challenges facing key sectors of the industry — from competition to labor shortages to the "locally grown" movements that have encouraged consumers to buy from smaller producers all over the country.

Still, the total value of the more than 150 crops grown in the county was tallied at $4.25 billion for the year, according to the figures released by the Monterey County Agricultural Commissioner's office.

An estimated 80 percent of all leafy greens in the U.S. is grown in Salinas Valley.The agriculture industry supports an estimated 76,000 jobs; one in four households works in the industry, according to the Monterey County Farm Bureau.

At a news conference Tuesday, Jim Bogart, president and general counsel for the Salinas-based Grower-Shipper Association of Central California, called 2015 an anomaly. He said "2016 is more in line with what is normal.”

Bogart said the report shows that agriculture can be “unpredictable, volatile, and people in the agriculture industry are affected by forces beyond their control.” He added that the report also shows the industry as resourceful and innovative. "A big strength here is a diversity of the crops we produce to the nation and the world,” he said.

Representatives from the Farm Bureau, Monterey County Vintners & Growers Association (MCVGA) and the California Strawberry Commission also presented at the news conference.

Agricultural Commissioner Eric Lauritzen attributed the decline to a variety of factors including weather, consumer habits and a continued severe labor shortage which affected many of the core crops such as lettuce, broccoli, and cauliflower.

The figures are gross values and don’t reflect the net profit or loss by individual growers, Lauritzen said.

Patrick Collins, a senior director at Dole Fresh Vegetables said the fall in value is due in part to oversupply, which leads to lower market prices. For example, the value per unit of a head of lettuce fell from $14.85 to $11.53 and a wrapped pack of lettuce fell from $17.25 unit to $12.65.

Collins also pegged the drop to a shift in consumer behavior, namely a movement towards eating locally sourced foods.  

“You see this especially in the East Coast, more consumers are eating local and homegrown,” said Collins. Moreover, there is also a shift in consumers purchasing organic produce.  

Sales of organic produce in the U.S. hit a record of $43.3 billion in 2015 according to the Organic Trade Association. There are 21,781 certified organic operations in the United States and 31,160 around the world according to the U.S. Department of Agriculture (USDA). U.S. organic sales saw a new record of $43.3 billion in 2015.

That said, some crops bucked this year’s trend with an increase in value; the wine grape industry saw a 28.5% rise in value in part due to increased efforts to market wine with food and tourism. Kim Stemler, executive director of the Monterey County Vintners and Growers Association, estimated the wine, agriculture and tourism industry, is closing in on $1 billion.

Key highlights in the 2016 report include:
 

Leaf lettuce is the top valued crop at $783 million and saw a 10% decline from 2015.

Strawberries the second valued crop at $725 million remained nearly the same. Chris Christian, Vice President of Marketing, California Strawberry Commission, said the success was due to ideal weather and an expansion of the strawberry varieties.  The county also recently started to import strawberries to Mainland China.

Head lettuce was the third most valued at $478 million but saw a 25% drop due to lower production.

The nursery category valued at $276 million a 12% drop from $313.6 million, the decline in part attributed to the growth of the medical cannabis industry. Numerous growers have been purchasing the greenhouses for medical marijuana.

AgTech and challenges

Along the lines of national and statewide trends local and regional growers continue to face challenges including a severe labor shortage of field workers, water and land limitations and growing costs of doing business.

Moreover, by 2050 farmers need to produce twice as much food with fewer resources to feed the world’s growing population, according to the United Nations Food and Agriculture Organization.

Bogart and Norm Groot, executive director of the Monterey County Farm Bureau, said the labor shortage has been an ongoing problem for the past five years. It is being caused by an aging workforce, which is not being readily replaced by a new generation of field workers.

The middle class in Mexico is also rising and Mexicans “aren’t coming in the number that they used to,” Bogart said. The industry as a whole continues to push for comprehensive immigration reform and a program that would replace the H-2A temporary guest worker program, which can be costly and requires farmworker housing.

“We are going to work on it because we are still very labor dependent,” Bogart said.

In the meantime, the industry is increasingly turning to automation, robotics, and a small but fast-growing sector known as agtech for solutions. Agtech uses technology to increase efficiency and lower costs.

Salinas, surrounding cities, the agriculture industry and educational institutions including Hartnell College and Cal State Monterey Bay, have been major proponents of expanding the agtech sector locally.

Collins said Dole is looking at more drone technology.

Bogart said the release of the report is timely as it was released a day before the 2017 Forbes AgTech Summit, which the city of Salinas has hosted for the third year in a row. The Summit is a premiere event for leaders in agriculture and technology.

Cannabis

Lauritzen said there are no immediate plans to add cannabis to the annual crop report, and there are numerous issues to be ironed out including taxes, legalities and public safety. Cannabis is currently not categorized as an agricultural commodity.

“It is definitely going to be impactful but we are so new at this so we don’t realize what those impacts are going to be,” said Groot of the Farm Bureau. “I think there are a lot of things that have yet to be determined.”

To read the Monterey County 2016 Crop Report go to:
http://www.co.monterey.ca.us/government/departments-a-h/agricultural-commissioner#ag

The top 10 crops of 2016.

Contact Government Reporter Amy Wu at 831-737-6791 or awu@thecalifornian.com. Follow Wu on Twitter @wu_salnews or www.facebook.com/amywucalifornian.