MARKET REPORT – JULY 22, 2015

STAGE 4 DROUGHT PREVAILS IN SW BC

Much of SW BC has now been placed in Stage 4 drought.  This is the same Stage 4 ranking as California that they describe down there as severe drought.  Ours really got going in the fall of 2014, with progressively warmer temperatures above normal, and lower rainfall, to the point we are now in the same boat as California.  Boat probably isn’t the best descriptor, nor is up shit creek without a paddle.   The average house price in Vancouver is now over $2M as foreign money pours into the area, with investors assuming that Vancouver is a ‘safe haven’ for their money with ever increasing prices.  However, like people in California, their fancy landscaped lawns and gardens are now going un-watered and looking more desert like.  Their driveways are dusty, as are their cars.  But the impacts are far greater to the East in the Fraser Valley.  Crop after crop is being affected where so many growers are managing their water very carefully in fear of wells drying up – and most of the wells in the Fraser Valley are between 150 and 300 meters deep already.  Crops usually abundant are suffering – the extended heat has put pressure on many ground crops with lettuce, spinach and cilantro bolting before ready.There is no minimum wage for local farm-workers, except for seasonal labourers under the foreign workers programs, but the blueberry crop is usually harvested by our large mostly resident work force.  Those pickers are paid by the pound, not by the hour, and with lean production on blueberries, they are making very little money and not picking fields where they can’t make a decent income.  Another summer treat here is Fraser Valley’s famous Chilliwack corn, but farmers cannot afford to irrigate hundreds of acres of corn that traditionally don’t need water.  And of course, with so many crops coming on at once, there is a general lack of labour to keep everything harvested.  Some growers expect to lose up to 75% of their crops simply because of a lack of labour.Things of course are far worse in California.  I picked this story out of a regional California newspaper, which may give you some insight into the rising prices of citrus crops.  Predicted crop shortages are now also affecting availability on spinach, broccoli and cauliflower in California.From “Ag Alert” – the weekly newspaper for the agricultural industry in California –short video : Drought is impacting citrus growers in Tulare County in a very serious way“Faced with the fourth consecutive year of drought and a second year of no water from the Friant Division of the Central Valley Project, Tulare County farmer Zack Stuller said he and his fellow citrus growers are in "survival mode.""We're not giving up," said Stuller, who works for Sun Pacific, a grower, packer and shipper of citrus, table grapes, fresh tomatoes and kiwifruit, and who grows citrus, walnuts and field crops at his home ranch. But, he added, "For a way of life for what we do, you talk to any farmer in this valley or any farmer anywhere, you are taking away his livelihood. It's very scary."The ongoing drought and water shortages are scarring the California citrus belt on the east side of the San Joaquin Valley, where blocks of citrus trees are abandoned or have been removed, and for-sale signs and well-drilling rigs are common. Farmers in citrus-growing regions that have no surface water and very little groundwater are scrambling to locate enough water just to keep trees alive.”“For a second consecutive season, the 20-plus irrigation districts that receive water from this project face a zero allocation of water. In areas where farmers don't have access to groundwater, groves of trees, such as navel and Valencia oranges, are being removed so that water can be diverted to more valuable citrus varieties, such as mandarins and lemons. Tulare County citrus grower Roger Everett, who received a zero water allocation from the Terra Bella Irrigation District, said that of his 75 acres of citrus, he has enough water to irrigate only 15 acres.”The drought also has expanded to Alberta this year.CBC News in Edmonton reports, “With Alberta's capital now surrounded by "agricultural disaster" areas, the province's agriculture minister said Tuesday what farmers have been saying for weeks.Leduc County, on Edmonton's southern border, on Tuesday became the fourth Alberta County in two weeks to declare a state of "agricultural disaster."County Mayor John Whaley was as plain-spoken as the farmers and ranchers who elected him. Whaley wants the provincial or federal governments to offer farmers tax deferrals, if they're forced to sell their cattle herds, and loans to buy feed for cattle they manage to keep.”Sorry, wish we had better news for you, and only report this in a periodic manner so your customers understand why they are paying so much more for many fruit and vegetables.