Fecha de publicación: 10/09/2024 Fuente: Morning Star Lugar: Articles Looking Ahead: Key Considerations for California Growers in 2025
As we transition into Fall, growers are already looking ahead to 2025 with a range of considerations. They are evaluating prices, demand for their commodities, borrowing interest rates, financing, labor, weather, and water resources, alongside their usual business concerns.
Commodity prices and demand are closely linked. While there are no major shortages in California-grown crops that might drive up prices, we have seen a recent increase in corn silage prices. This is due to a reduced planting of silage this year, lower forecasted prices, high temperatures impacting yield, and dairy customers’ concerns as we approach a potentially drier 2025. Additionally, milk and nut prices have improved. Meanwhile, most other California crops prices remain under pressure.
Although there is some optimism about falling borrowing rates, they remain about 4% higher than what growers have previously paid. This increase in borrowing costs represents a significant expense compared to prior years.
Securing financing is another challenge. With falling commodity prices, land values have also decreased. Land in critically over drafted groundwater basins affected by the Sustainable Groundwater Management Act (SGMA) face pumping restrictions, potentially limiting crop production and affecting returns. Consequently, lending institutions may require growers to contribute more to their financing, reducing available operating capital.
Labor costs are also on the rise, especially following the recent legislation raising fast food workers’ wages to $20 per hour. Attracting skilled agricultural labor remains a challenge amidst competitive pay rates.
Despite these challenges, California growers continue to demonstrate remarkable resilience. They are known for their innovative and adaptive solutions, as well as their dedication to meeting demand and providing high-quality crops.



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