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Yahoo
13-04-2025
- Business
- Yahoo
California farmers brace for consequences as Trump's tariffs bring economic upheaval
President Trump's decision to pause punishing tariffs on most U.S. trading partners may have calmed financial markets last week, but it did little to quell anxiety in California's $59 billion agricultural industry. While Trump kept smaller 10% blanket tariffs on countries around the world, he has imposed much higher levies on products from Canada and China, two of the top markets for California's almonds, pistachios, oranges and other crops. Trump increased tariffs on Chinese goods to 145%. Beijing retaliated by slapping 125% tariffs on American goods, including California nuts and dairy products. Canada retaliated against U.S. tariffs with 25% taxes on American goods, which are already cutting into sales of California agricultural products, including fresh produce and wine. Farmers in the Central Valley say they are nervous about what might come if Trump goes ahead with the larger, so-called reciprocal tariffs after the 90-day pause. If the upheaval persists, they fear it could spiral into long-lasting and damaging conflicts. 'It's scary,' said Christine Gemperle, an almond farmer in Ceres, near Modesto. 'Nobody wants to be in the center of chaos.' Bianca Kaprielian, a fourth-generation citrus farmer in Reedley and co-chief executive of Creekside Organics, said she is already seeing sales suffer. 'Across the board, everybody's going to feel it,' she said. Elsewhere in Fresno County, farmer John Diener said he hasn't yet seen effects on the sales or prices of his crops, but he's watching closely. 'People are waiting with bated breath,' he said. 'I think everybody in their business is concerned about what might be the outcome.' Trump has said he believes tariffs are needed to bring 'fair trade,' protect U.S. workers and reduce the trade deficit. U.S. Agriculture Secretary Brooke Rollins said last week that the White House is preparing a relief plan to support farmers 'if necessary.' Details have yet to be made public. Much is at stake for California's agriculture industry, which ships nuts, rice, tomatoes and other products around the world. The state is the nation's top agricultural exporter, with global sales totaling nearly $24 billion in 2022. As China, Canada and other countries retaliate against U.S. tariffs by imposing their own taxes on American goods, a substantial burden could fall on California's farming businesses. Read more: California farmers backed Trump. Now, his tariffs could hurt them Representatives of California agriculture associations have been raising their concerns with the Trump administration and members of Congress. 'California's farmers and ranchers are at significant risk of bearing the brunt of any potential retaliatory actions resulting from the broad imposition of global tariffs,' said Shannon Douglass, president of the California Farm Bureau Federation. Douglass said in an email that many growers are already struggling with chronic labor shortages, inflation and other challenges, and that retaliatory measures by other countries could lead to more instability for the industry. 'While we believe targeted trade measures can be helpful in protecting California's production and serve as a useful negotiating tactic,' she said, 'we are still waiting to see what measures other countries take as a result of these tariffs as further trade tensions could jeopardize the viability of California agriculture.' Karen Ross, secretary of the California Department of Food and Agriculture, said she is deeply concerned about the potential consequences. 'California farmers are already very challenged,' Ross said in an interview. 'Profit margins are being squeezed considerably. Export markets are hugely important.' In recent years, Canada has been the top foreign buyer of California's agricultural exports, including wine, strawberries, lettuce and oranges. The European Union has ranked second, and China has ranked third, providing thriving markets for nuts, dairy products and other commodities. Now, these trade relationships have begun to shift and fray. For example, in addition to Canada's 25% tariffs on many U.S. goods, Canadians have also begun to boycott American products. 'How long that will last is hard to say, but it certainly has created a great deal of unease,' Ross said. In an analysis published last year, economists warned that if Trump imposed major tariffs, the reactions from trading partners could lead to billions of dollars in losses for California's agriculture industry. UC Davis Professor Emeritus Colin A. Carter, who co-authored the research, said China's retaliatory tariffs are now much higher than what they analyzed, and will choke off Chinese purchases of pistachios, almonds and dairy products. Ross said farmers are hoping that the economic disruption will be short-lived and quickly resolved. If it goes on, she said, 'there will need to be mitigation measures.' During Trump's first term, farmers received billions of dollars in subsidies to help cushion the blow of the tariff-related losses for crops such as soybeans. But California's farmers, producing different crops, largely didn't qualify for that government compensation. California's No. 1 export crop is almonds. A boom in global prices a decade ago led growers to rapidly plant many new almond orchards. Over the last several years, however, the total acreage of almond orchards has begun to decline because of lower prices. California now produces an estimated 76% of the world's almonds, with the leading buyers including India, Spain, the United Arab Emirates and China. Gemperle and her brother grow almonds on 135 acres in Stanislaus and Merced counties, and their nuts are sold in the U.S. and abroad through the Blue Diamond Growers cooperative. Gemperle said it's too soon to know how the tariffs will affect almond prices, but she is concerned about the current uncertainty. 'Farming is uncertain and a risk and a gamble, as it is. We don't need more of that,' she said. 'It's all just overwhelming.' The situation was bad enough during Trump's first term, she said, when the adoption of U.S. tariffs in 2018 prompted China to retaliate, bringing losses for growers of almonds, walnuts and other crops. 'We got hammered,' Gemperle said. "We lost the whole Chinese market to Australia." As China bought less nuts following that first round of tariffs, it contributed to persistent declines in California almond prices. In recent years, the slumping prices have pushed some almond growers out of business, leaving orchards up for sale in places throughout the Central Valley. 'Prices were just starting to come back up,' Gemperle said. 'Now we're getting hit with even more tariffs, and we just can't see the end.' She said she is concerned about the possibility of losing other vital markets, while at the same time seeing the U.S. tariffs push prices higher for imported farm equipment, fertilizer and other supplies. 'This just makes everything we do so much harder,' she said. 'It does keep me up at night, and it gives me bad dreams.' Wearing overalls and work boots, Gemperle walked through her orchard with a clipboard under her arm, stopping to check traps hung in the trees to monitor for almond-eating insects. Her four border collies followed behind, scampering through tall grass and wildflowers. Gemperle said because of high operating costs and low prices, she and her brother Erich have gone about four years without turning a profit, and have been living off their savings. 'At this point, I'm on the verge of losing everything,' she said. 'I just wonder if going through this is just going to seal the deal on killing small family farms.' California citrus growers also depend on international trade, shipping fruit to South Korea, Canada, Japan and other countries. Kaprielian's company, Creekside Organics, sells organic citrus and vegetables for a group of growers. It typically ships a substantial amount of mandarins, oranges and lemons to Canada. But this year, exports to Canada have dropped. 'We have seen those orders go down or dry up,' Kaprielian said. 'We feel the effect.' At her family's packing house in Reedley, Kaprielian watched as mandarins tumbled from machinery onto beds of metal rollers. Workers wearing rubber gloves scanned the advancing fruit, grabbing any mandarins with blemishes and dropping them into chutes to be trucked to a juice plant. Other mandarins rolled on for sorting and were boxed to be sold under the Fruit World brand. 'I think as an industry we're not sure about the future,' Kaprielian said. 'If we start losing those export markets, that means we're going to have an influx of supply on the domestic market.' The concern is that the domestic market couldn't absorb such an influx, potentially leading to lower prices. At the same time, she said, the U.S. tariffs are pushing up costs for growers and eroding their already slim profit margins. 'That's really the big concern in California agriculture in general,' Kaprielian said. 'Is there going to be enough money going back to the farm to make it all work to keep farming again the next year?' She said the economic turmoil adds to the list of challenges for growers, who are also grappling with regulations, long-running labor shortages, water constraints and the effects of climate change. As she was growing up, Kaprielian would often help her father on the farm and at the packing house. Her family continues to grow citrus on about 500 acres in Fresno and Tulare counties. Lately, she said, she feels more uncertain about the future. 'With everything getting so difficult, I don't know if my family is going to be farming in five years. I don't know if we're going to be able to hang on 10 years,' she said. Kaprielian said she deeply loves farming, but has seen some other operations struggling and going out of business in recent years. 'You can only take so many blows,' she said. 'I really hope that our politicians understand that this is affecting real people.' A short drive from the packing house, Kaprielian stopped at a grove of mandarins. Picking one, she cut the peel with a knife and lifted a juicy half to her mouth. With the citrus season now nearing its end, Kaprielian said she would have liked to see this grove harvested already. But the harvest has been slowed as demand is down, she said, partly because of the trade conflict with Canada. 'We're seeing sluggish sales,' Kaprielian said. 'It feels more chaotic than any time that I can remember.' The dramatic shifts in Trump's announcements have left farmers thinking they will need to wait to see how the situation develops. 'We're moving ahead like normal, and pray that it'll all get sorted out,' said Diener, who farms tomatoes, garlic, almonds, cotton and other crops in Fresno County. 'Everybody's looking to be able to keep their industry healthy.' Diener has been farming since 1980 and weathered many changes, including previous shifts in federal policies. 'I don't see why this area won't prosper long-term,' Diener said. 'Because where else are you going to get what it is that we grow?' Ross said many growers are hoping there will be negotiations for better trade agreements to benefit agriculture. 'We're all hopeful that the outcome will be more robust trading opportunities. But the longer the uncertainty and unpredictability lasts, the more likely the harm is, because it starts to create its own self-cascading circumstances,' Ross said. 'The more uncertain things are, the harder it is to just do business.' This story originally appeared in Los Angeles Times.
Los Angeles Times
13-04-2025
- Business
- Los Angeles Times
California farmers brace for consequences as Trump's tariffs bring economic upheaval
CERES, Calif. — President Trump's decision to pause punishing tariffs on most U.S. trading partners may have calmed financial markets last week, but it did little to quell anxiety in California's $59 billion agricultural industry. While Trump kept smaller 10% blanket tariffs on countries around the world, he has imposed much higher levies on products from Canada and China, two of the top markets for California's almonds, pistachios, oranges and other crops. Trump increased tariffs on Chinese goods to 145%. Beijing retaliated by slapping 125% tariffs on American goods, including California nuts and dairy products. Canada retaliated against U.S. tariffs with 25% taxes on American goods, which are already cutting into sales of California agricultural products, including fresh produce and wine. Farmers in the Central Valley say they are nervous about what might come if Trump goes ahead with the larger, so-called reciprocal tariffs after the 90-day pause. If the upheaval persists, they fear it could spiral into long-lasting and damaging conflicts. 'It's scary,' said Christine Gemperle, an almond farmer in Ceres, near Modesto. 'Nobody wants to be in the center of chaos.' Bianca Kaprielian, a fourth-generation citrus farmer in Reedley and co-chief executive of Creekside Organics, said she is already seeing sales suffer. 'Across the board, everybody's going to feel it,' she said. Elsewhere in Fresno County, farmer John Diener said he hasn't yet seen effects on the sales or prices of his crops, but he's watching closely. 'People are waiting with bated breath,' he said. 'I think everybody in their business is concerned about what might be the outcome.' Trump has said he believes tariffs are needed to bring 'fair trade,' protect U.S. workers and reduce the trade deficit. U.S. Agriculture Secretary Brooke Rollins said last week that the White House is preparing a relief plan to support farmers 'if necessary.' Details have yet to be made public. Much is at stake for California's agriculture industry, which ships nuts, rice, tomatoes and other products around the world. The state is the nation's top agricultural exporter, with global sales totaling nearly $24 billion in 2022. As China, Canada and other countries retaliate against U.S. tariffs by imposing their own taxes on American goods, a substantial burden could fall on California's farming businesses. Representatives of California agriculture associations have been raising their concerns with the Trump administration and members of Congress. 'California's farmers and ranchers are at significant risk of bearing the brunt of any potential retaliatory actions resulting from the broad imposition of global tariffs,' said Shannon Douglass, president of the California Farm Bureau Federation. Douglass said in an email that many growers are already struggling with chronic labor shortages, inflation and other challenges, and that retaliatory measures by other countries could lead to more instability for the industry. 'While we believe targeted trade measures can be helpful in protecting California's production and serve as a useful negotiating tactic,' she said, 'we are still waiting to see what measures other countries take as a result of these tariffs as further trade tensions could jeopardize the viability of California agriculture.' Karen Ross, secretary of the California Department of Food and Agriculture, said she is deeply concerned about the potential consequences. 'California farmers are already very challenged,' Ross said in an interview. 'Profit margins are being squeezed considerably. Export markets are hugely important.' In recent years, Canada has been the top foreign buyer of California's agricultural exports, including wine, strawberries, lettuce and oranges. The European Union has ranked second, and China has ranked third, providing thriving markets for nuts, dairy products and other commodities. Now, these trade relationships have begun to shift and fray. For example, in addition to Canada's 25% tariffs on many U.S. goods, Canadians have also begun to boycott American products. 'How long that will last is hard to say, but it certainly has created a great deal of unease,' Ross said. In an analysis published last year, economists warned that if Trump imposed major tariffs, the reactions from trading partners could lead to billions of dollars in losses for California's agriculture industry. UC Davis Professor Emeritus Colin A. Carter, who co-authored the research, said China's retaliatory tariffs are now much higher than what they analyzed, and will choke off Chinese purchases of pistachios, almonds and dairy products. Ross said farmers are hoping that the economic disruption will be short-lived and quickly resolved. If it goes on, she said, 'there will need to be mitigation measures.' During Trump's first term, farmers received billions of dollars in subsidies to help cushion the blow of the tariff-related losses for crops such as soybeans. But California's farmers, producing different crops, largely didn't qualify for that government compensation. California's No. 1 export crop is almonds. A boom in global prices a decade ago led growers to rapidly plant many new almond orchards. Over the last several years, however, the total acreage of almond orchards has begun to decline because of lower prices. California now produces an estimated 76% of the world's almonds, with the leading buyers including India, Spain, the United Arab Emirates and China. Gemperle and her brother grow almonds on 135 acres in Stanislaus and Merced counties, and their nuts are sold in the U.S. and abroad through the Blue Diamond Growers cooperative. Gemperle said it's too soon to know how the tariffs will affect almond prices, but she is concerned about the current uncertainty. 'Farming is uncertain and a risk and a gamble, as it is. We don't need more of that,' she said. 'It's all just overwhelming.' The situation was bad enough during Trump's first term, she said, when the adoption of U.S. tariffs in 2018 prompted China to retaliate, bringing losses for growers of almonds, walnuts and other crops. 'We got hammered,' Gemperle said. 'We lost the whole Chinese market to Australia.' As China bought less nuts following that first round of tariffs, it contributed to persistent declines in California almond prices. In recent years, the slumping prices have pushed some almond growers out of business, leaving orchards up for sale in places throughout the Central Valley. 'Prices were just starting to come back up,' Gemperle said. 'Now we're getting hit with even more tariffs, and we just can't see the end.' She said she is concerned about the possibility of losing other vital markets, while at the same time seeing the U.S. tariffs push prices higher for imported farm equipment, fertilizer and other supplies. 'This just makes everything we do so much harder,' she said. 'It does keep me up at night, and it gives me bad dreams.' Wearing overalls and work boots, Gemperle walked through her orchard with a clipboard under her arm, stopping to check traps hung in the trees to monitor for almond-eating insects. Her four border collies followed behind, scampering through tall grass and wildflowers. Gemperle said because of high operating costs and low prices, she and her brother Erich have gone about four years without turning a profit, and have been living off their savings. 'At this point, I'm on the verge of losing everything,' she said. 'I just wonder if going through this is just going to seal the deal on killing small family farms.' California citrus growers also depend on international trade, shipping fruit to South Korea, Canada, Japan and other countries. Kaprielian's company, Creekside Organics, sells organic citrus and vegetables for a group of growers. It typically ships a substantial amount of mandarins, oranges and lemons to Canada. But this year, exports to Canada have dropped. 'We have seen those orders go down or dry up,' Kaprielian said. 'We feel the effect.' At her family's packing house in Reedley, Kaprielian watched as mandarins tumbled from machinery onto beds of metal rollers. Workers wearing rubber gloves scanned the advancing fruit, grabbing any mandarins with blemishes and dropping them into chutes to be trucked to a juice plant. Other mandarins rolled on for sorting and were boxed to be sold under the Fruit World brand. 'I think as an industry we're not sure about the future,' Kaprielian said. 'If we start losing those export markets, that means we're going to have an influx of supply on the domestic market.' The concern is that the domestic market couldn't absorb such an influx, potentially leading to lower prices. At the same time, she said, the U.S. tariffs are pushing up costs for growers and eroding their already slim profit margins. 'That's really the big concern in California agriculture in general,' Kaprielian said. 'Is there going to be enough money going back to the farm to make it all work to keep farming again the next year?' She said the economic turmoil adds to the list of challenges for growers, who are also grappling with regulations, long-running labor shortages, water constraints and the effects of climate change. As she was growing up, Kaprielian would often help her father on the farm and at the packing house. Her family continues to grow citrus on about 500 acres in Fresno and Tulare counties. Lately, she said, she feels more uncertain about the future. 'With everything getting so difficult, I don't know if my family is going to be farming in five years. I don't know if we're going to be able to hang on 10 years,' she said. Kaprielian said she deeply loves farming, but has seen some other operations struggling and going out of business in recent years. 'You can only take so many blows,' she said. 'I really hope that our politicians understand that this is affecting real people.' A short drive from the packing house, Kaprielian stopped at a grove of mandarins. Picking one, she cut the peel with a knife and lifted a juicy half to her mouth. With the citrus season now nearing its end, Kaprielian said she would have liked to see this grove harvested already. But the harvest has been slowed as demand is down, she said, partly because of the trade conflict with Canada. 'We're seeing sluggish sales,' Kaprielian said. 'It feels more chaotic than any time that I can remember.' The dramatic shifts in Trump's announcements have left farmers thinking they will need to wait to see how the situation develops. 'We're moving ahead like normal, and pray that it'll all get sorted out,' said Diener, who farms tomatoes, garlic, almonds, cotton and other crops in Fresno County. 'Everybody's looking to be able to keep their industry healthy.' Diener has been farming since 1980 and weathered many changes, including previous shifts in federal policies. 'I don't see why this area won't prosper long-term,' Diener said. 'Because where else are you going to get what it is that we grow?' Ross said many growers are hoping there will be negotiations for better trade agreements to benefit agriculture. 'We're all hopeful that the outcome will be more robust trading opportunities. But the longer the uncertainty and unpredictability lasts, the more likely the harm is, because it starts to create its own self-cascading circumstances,' Ross said. 'The more uncertain things are, the harder it is to just do business.'
Yahoo
19-03-2025
- Business
- Yahoo
Farming consolidation worries ag industry leaders
Federal data illustrating recent consolidation of California farming has raised concern in the industry about Sacramento's approach to regulation and the future of ag production in the state. Industry leaders are pointing to U.S. Department of Agriculture figures that show the number of farms in California fell 10% between 2017 and 2022, while the average size of those farms increased by about the same proportion. Both trends were seen nationally during the same period but not to such an extent. President Shannon Douglass of the California Farm Bureau Federation said the numbers are not surprising given how hard it is to do business in the state as compared with other farming regions around the world. She voiced particular concern about water availability and how costs disproportionately hit small farmers. The head of the Kern County Farm Bureau, Jenny Holtermann, added that consolidation is always a concern as farmers shrink their farmland holdings or sell out altogether. She said implementation of California's Sustainable Groundwater Management Act, designed to bring pumping of underground aquifers into balance, is likely to leave some farmers unable to produce food. "With increasing regulations, SGMA and the costs of inputs rising, farmers can only stay afloat for so long," she said by email Tuesday. "We need our elected officials and policymakers to start to address our over-regulation and how they are pushing business out of California," she added. "Agriculture is vital to California and our food security for our country." The USDA data doesn't just shine a light on consolidations between 2017 and 2022, the most recent year for which figures are available. It also provides insights on the industry's mixed profitability. It shows the number of farms in the state reporting a profit dropped significantly during that five-year period but that those who reported a net gain made much more money than before. Additionally, the numbers demonstrated that fewer California farms lost money in 2022 as compared with 2017, but those who did saw significantly bigger losses. Also, average profits in the Golden State were considerably higher than those in the country as a whole. The federal numbers being highlighted by the California Farm Bureau Federation are available online at The organization plans to host a news conference on the consolidation-related findings today just outside the state Capitol building in downtown Sacramento. According to the USDA, California's total farm count dropped to 63,134 in 2022. Nationally, it reported, the decline between 2017 and 2022 was about 7%. The average size of California farms increased by 10% during that five-year period to reach 383 acres. Across the country, the size increase was just 5%, though the U.S. average finished the period higher, at 463 acres. USDA data showed the number of Californian farms reporting a profit dropped about 18%, while the size of those net gains rose 76% to hit an average of $665,459 per year. By comparison, the number of farms nationwide that made a profit shrank only 9%, according to the USDA, which noted the average size of those profits rose 78% to reach $224,025 per year. In California, the number of farms reporting a net financial loss declined 5% between 2017 and 2022, the USDA reported. It noted the average size of those losses increased 87% to finish the year with a profit averaging $104,258. The number of U.S. farms reporting a net loss also declined during the period, by 6%. But as happened in California, their losses rose — by 36% to reach $28,597 per year. Douglass, the state farm bureau president, did not bring up the industry challenge presented by the Trump administration's threat to deport undocumented residents. But she acknowledged that mass deportations could present problems for farmers. "I think that anytime we're talking about threats to our workforce, those are definitely challenges that impact our farms," she said.
