It’s one of the major questions related to the multiyear drought in California—will the lack of water lead to higher food prices in supermarkets across America? Has it already?
The short answer is that food prices have indeed increased dramatically for a number of food products over the last year. For instance, romaine lettuce jumped about 60 cents per pound to $2.19, and frozen orange juice went from $2.43 for 16 ounces to $2.73, an increase of 12.5 percent, according to Bureau of Labor information comparing February 2014 prices to February 2015 prices.
But experts noted that it’s complicated—such price increases stem from a variety of factors, of which the drought is just one. And while some food products increased in price, others, such as milk, coffee, and peppers, have decreased. Other analysts warn the drought will likely have a bigger impact in the coming weeks and months.
Crops at Risk for Greatest Price Increase
Eat an almond anywhere in the world, and there’s a good chance it was harvested in California.
The state produces about 80 percent of the global supply, exporting about 70 percent of the 1 million tons it produced in 2012, for example. Farmers hauled in $3.3 billion that year for almond exports, easily the top export from The Golden State in terms of value.
California also produces the bulk (70 percent or more) of 20 other food products in the United States, including apricots, avocados, strawberries, and romaine lettuce.
But most of these products are increasingly imported, decreasing the potential price increases due to the drought. About 7 of every 10 avocados, in American grocery stores, for example, are imported. Most apricots, kiwifruit, and artichokes are also imported. About half of the figs, grapes, plums, olives, and garlic are imported.
That leaves about a dozen crops that California produces the bulk of that aren’t supplemented much by imports: The United States barely imports any of the nuts California specializes in—almonds, walnuts, and pistachios; it imports little that the fruit that the state produces the majority of—strawberries, lemons, nectarines, and peaches; and these vegetables are barely grown outside California—broccoli, carrots, cauliflower, celery, and lettuce.
James Dunn, professor of Agricultural Economics at Penn State, said he sees a big potential for the drought to impact the price products that California specializes in, such as almonds.
“We’ve seen some of them increase, but we’re going to see more of them,” he said.
While the drought has had an impact on some prices already, there’s typically a delay in how food prices are affected because of harvest cycles. But, for instance, almonds are set to become more expensive this year since a number of farmers cut off bunches from almonds trees last year because of the drought—a drastic measure that has also been employed this year.
“We’re working off the inventories right now, but the prices of those inventories are already starting to reflect the fact that there’s not as much new crop behind it, so that becomes a big deal,” Dunn said.
