Pistachios Continued from Page 3
pistachio growers is the “tremendous amount of new acres coming into pro- duction,” Matoian said. State acreage increased 20% between 2020 and 2022, from 371,386 to 446,000 acres. While it took 40 years for production to reach 1 billion pounds, he said he expects it will balloon to 2 billion pounds in the next 10 years. “What effect all this additional acreage and growth has on the industry remains to be seen,” he said. “There’s an argument
to say consumers want our product, and we’re going to be just fine. But there’s also another argument that there’s going to be too much on the marketplace.” Calling the growth numbers “scary,” Madera County grower Chris Wylie said the race to add new acreage does con- cern him. He also grows almonds and has seen how prices have responded to the increasing acreage. He said he wonders at what point pistachio prices will take the same dive. But he noted pistachio
brokers and nut processors tell him the market can take a 2-billion-pound crop “and still be OK.” “I hope they’re right,” said Wylie, who added that overplanting “does worry me though.” Pistachios prices have already fallen, said Thom Dille, CEO of Little Creek Inc., which grows pistachios in Kern County. He noted that in 2020, the base price be- fore bonuses was $1.85 a pound, and this year it’s a $1.38. Meanwhile, his production costs have more than doubled in 10 years. In 2010, it cost him $1.2 million to produce the crop. In 2020, his costs rose to $2.5 mil- lion, with much of the increase related to water. With the drought and the lack of water deliveries to farms, he’s had to buy water on the open market at about $1,000 an acre-foot; that’s compared to the normal rate of $220 an acre-foot in Kern County. In planning for restrictions on ground- water pumping, Dille said the company bought an old almond orchard that it has fallowed, so that it can use the wa- ter allocations from that property for its pistachios. All this adds to the expense of producing the nut. With the rising cost of labor, chemicals and other inputs, he said it begins to make pistachios unprofitable. “We seem to be better off than al- monds, but it used to be much more profitable,” Dille said. Even so, Dille said he remains optimis- tic about producing a larger-size quality crop this year with the assumption that he will receive perhaps not a full alloca- tion of water “but certainly the best one in probably 10 years.” (Ching Lee is an assistant editor of Ag Alert. She may be contacted at clee@cfbf.com.) Pistachio study shows economic impacts of crop The surge in bearing acres for pista- chios has helped drive an economic boom in the sector, with growers and pro- cessors contributing more than $6.4 bil- lion to the state’s economy, according to a new study commissioned by American Pistachio Growers. California pistachio bearing acreage jumped from 371,386 in 2020 to 446,000 in 2022. The acreage increase spurred grower and processor spending of more than $513.8 million, the study found. Overall spending by the sector helped create 55,100 full-time jobs and nearly $3 billion in labor income in 2022, the study said. Grower and processor spending totaled nearly $3.5 billion annually, or the equiv- alent of more than $9.5 million per day in 2022. Total economic output by the pista- chio industry topped $6.4 billion, an aver- age of more than $17.6 million every day, impacting other sectors such as real es- tate, professional services, construction, insurance and retail, the study reported.
on pistachios going to China—has tak- en that market, becoming its top suppli- er, Matoian said. Meanwhile, U.S. pis- tachio exports to China have plunged 21.5%. Some of the lost sales have been offset by growth in the European Union, the top destination for U.S. pistachios. Exports to the EU have increased 9.2%, Matoian noted. The potential danger for California
Join us in standing up for California’s farmers and ranchers. REGISTER NOW • MARCH 27–29, 2023 Join the grassroots process with California Farm Bureau President Jamie Johansson and special guest speakers. Hilton Sacramento Arden West Featuring Commodity Advisory Committee Meetings & Legislative Day
THANK YOU TO
Premier Partner
Title Sponsor
Nut Trees Commodity Sponsor
Forestry/Public Lands Commodity Sponsor
Legislative Briefing Luncheon Sponsor
Coffee Break Sponsor
For event information and to register, visit cfbf.com/capitol-ag . Registration deadline is March 10.
10 Ag Alert March 8, 2023
Powered by FlippingBook