Price of fresh produce might increase due to severe drought in Califonia

Harry’s Berries Gean Family Farm, an organic fresh produce grower, plans to increase some of its products’ prices in next month if the record-breaking severe drought facing California prolongs this year.

Jennifer Gean, the owner the 27-year-old organic produce firm, projected a one-dollar-per-three-packs uptick next month for most of the organic berries her farm produces because the water price has gone up significantly for the past year resulting from the third straight year with below normal rainfall in California.

“As a berry specialty grower, we are very much depending on the water supply. Last year, it might probably be OK, but if the dry situation continues, we have to start very worrying, “ said Gean.

In effect, the firm has increased its products’ prices from time to time in the past few years.

“Last year, it went up a dollar because of related-overheads increase like fuels and supplies. Another thing is that we pay a much competitive rate to our employees. They are very well trained and hard-working. That does add to our overheads as well,” said Gean.

But according to Gean, the multiple price increases do not affect the farm’s revenue even though in financially difficult times because of its good reputation, combined with people’s perpetual willingness to eat healthy.

“Despite the sluggish economy in recent years when people have to be a little frugal out of necessity, they are still willing to pay it because of the quality. A good thing for us is we are in food industry and we are doing fresh produce. It the last thing people will save money on. We have royal customers to support us regardless of we having to increase the price and they continue to shop. It is a long-term investment to health,” said Gean.

Despite the deepening drought plaguing California, not every organic farm has experienced price fluctuation resulting from severe water shortage. Organic Santa Babara Pistachio Company is one of them.

Mary Mills, a worker at the farm, said the prices of the companies’ pistachio are pretty much stable in the past two years.

“The water shortage does not affect pistachio because pistachio trees do not require much water as other trees. But most of my neighboring famers are struggling. They drill the wells and they have to drill deeper and deeper, and they have to invest a lot of money on that. Then they will have to increase the price to make up for the investment,” said Mills.

Compared with economic cyclical shifts, many farmers say, their business is far more dependent on weather factors. Many of them rather use their own properties than taking out loans from the bank except in financial woes.

“We take our small business loans and things like that. We will have to plant out strawberry every year and new plants are big investment. If we have a not good financial year, we will have to resort to borrowing. But for the most parts, we tried to save up enough thought the year. We make more during those peaks of the seasons in the summer and save for the winter,” said Gean.

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