Commentary: News on crop revenue reports misses part of story


Issue Date: September 2, 2015
By Dave Kranz
Dave Kranz
Strong demand for many California crops, including almonds, above, boosted agricultural revenues at the same time the state suffers from drought and water shortages. But while revenues reached record levels, so did production costs—a fact not always noted in news coverage.

The word "despite" turned up in headlines from two national news outlets this past week, on stories that threatened to spawn a new narrative in the ongoing discussion of how the California drought has affected farmers and ranchers.

"Despite drought, California has record high crop revenue," USA Today reported.

"Despite the drought, California farms see record sales," read the headline on the NPR website.

The two news outlets drew on different sources to reach their conclusions. The USA Today story was based on a report from an Oakland-based environmental research organization, the Pacific Institute, which had projected 2014 revenues for California-grown field crops, vegetables, melons, fruits and nuts. The NPR story described figures for annual cash receipts, posted online earlier in the week by the U.S. Department of Agriculture.

The first line of the NPR piece outlined the new narrative represented by the two stories: "While prolonged drought has put a strain on California agriculture, most of the state's farms, it seems, aren't just surviving it: They are prospering."

California farmers sold nearly $54 billion worth of crops and commodities in 2014, the story noted, citing USDA statistics that showed an increase of more than 5 percent from the previous year.

Revenues rose, the stories noted, due to strong prices for a wide range of California-grown crops and commodities. And farmers were able to produce those crops and commodities by "draining their groundwater reserves," as NPR put it, or through "unsustainable over-pumping of groundwater," reported USA Today.

Of course, revenues are only half the story of a farm or ranch balance sheet, and groundwater use is only part of the way farmers have responded to water shortages.

More-nuanced coverage of the situation came from news outlets in the San Joaquin Valley, as they reported on record agricultural revenues posted during 2014 in the nation's top three farm counties: Tulare, Kern and Fresno.

In fact, a story in the Porterville Recorder opened by summarizing the narrative that was circulating through the national news.

"Tulare County's record farm values reported earlier this month probably raised a lot of eyebrows," the Recorder story began. "Many probably wondered how farmers can complain about the lack of irrigation water yet still produce a record crop."

But, the story continued, "The answer is not simple."

The story quoted the county agricultural commissioner, a local farmer, and Tulare County Farm Bureau Executive Director Tricia Stever Blattler, each of whom explained the difference between the gross cash receipts listed in the crop reports and net farm income.

"Yes, we have higher prices, but that doesn't translate into higher profits," farmer Eric Borba told the newspaper.

That was a detail noted in many of the local news stories but missing from most of the national coverage.

And here's the thing: Information about the "expenses" side of the ledger is also readily available.

On the same day that it posted the updated figures on cash receipts, the USDA Economic Research Service also posted a new table detailing production expenses for farms and ranches.

Those figures show that at the same time cash receipts for California crops set a record, production expenses also set a record. In the same year that cash receipts increased a little more than 5 percent, production expenses rose nearly 10 percent. And subtracting the expenses figure from the receipts figure, the "net" number decreased by more than 6 percent in 2014.

We're providing those numbers—and links to the USDA webpages where they're available—to reporters who contact us at the California Farm Bureau as they prepare their own "despite drought …" stories.

We're also trying to provide perspective on the second news narrative, the one about how California farmers' assumed prosperity is based on a shaky base of profligate groundwater use.

We point out to reporters that no one is more concerned about the health of groundwater aquifers than California farmers and ranchers, and that groundwater levels have typically recovered quickly after previous droughts. We also reiterate that one of the best ways to reduce the pressure on groundwater supplies is by enhancing supplies from other sources: building new surface-water reservoirs, improving availability of recycled water, desalinating seawater for urban coastal regions.

Of course, we also note the significant investments farmers have made to improve irrigation efficiency, through changes in irrigation systems and through changes in management including enhanced weather, soil and crop monitoring.

There's another point worth making, in the wake of the reports on record agricultural cash receipts:

It's the farmer's job to make the most he or she can out of the resources available. California farmers and ranchers have done that, through the thick of this punishing drought.

Now the question is: Will they be admired for that, or criticized?

(Dave Kranz is manager of the California Farm Bureau Federation Communications/News Division and editor of Ag Alert. He may be contacted at dkranz@cfbf.com.)

Permission for use is granted, however, credit must be made to the California Farm Bureau Federation when reprinting this item.