a* 1 ° F I C ^ Division of Agricultural Sciences UNIVERSITY OF CALIFORNIA % Of &0*£ $$$v"-^ "' : .* •' ' "" *'• ' *-•»'""•- /' ' '.' ^^^g? ^i^iPi " ; " f^i^fipgsi PROJECTIONS RELATING TO CALIFORNIA AGRICULTURE IN ■;^ G. W. DEAN • C. O. McCORKLE, JR. M : ttWmM^ : ^:, ^ m&immi®®&fa : • CALIFORNIA AGRICULTURAL EXPERIMENT STATION BULLETIN 778 THE GENERAL PICTURE OF CALIFORNIA AGRICULTURE IN 1975 >mm provided here, is based on definite assumptions as to world conditions, population growth, demand structure, the nature of interregional competition, and other conditions. If sub- sequent events confirm these basic assumptions, our projec- tions will be reasonably accurate; if the assumptions prove unfounded, our picture will be distorted. Many of our as- sumptions are necessarily oversimplifications, but they are made as explicit as possible so that readers may be fully aware of their nature. Economists have been understandably reluctant to hazard estimates of the future — particularly the relatively distant future. With no new and improved tools of analysis avail- able to us, our results are restricted by the unavoidable limitations in projections of this kind. I ndustrialization and population have increased rapidly in California since 1940. With these and other prominent trends have come changes in the state's agricultural economy. Large blocks of high-quality land have been converted to nonagricultural uses; competition for water among agricultural, industrial and human uses has become severe. At the same time, national consumption trends indicate increased demand for fruits, vegetables and other speciality crops grown in California. This bulletin ex- amines these questions concerning the fu- ture of California agriculture: What changes in crop and livestock production will take place in California by 1975? Will California's land and water re- sources permit the types of agricultural expansion indicated? What changes can be expected in the operation, ownership and management of individual farms? Assumptions. The 1975 projections pro- ceed within specific assumptions regard- ing future world conditions and the U. S. economy. Important assumptions are: • a trend toward world peace. • a U. S. population of 230 million by 1975, and • an increase in real per-capita income of 60 per cent between 1953 and 1975. Projection methods used combine arith- metic, statistical and judgment elements. California 1975 crop projections are based on (1) a previously estimated de- mand structure for U. S. farm products, (2) derivation of California's expected 1975 share of U. S. production, (3) judg- ment of 1975 yield levels by crop special- ists, and (4) derivation of California's 1975 acreage of particular crops. Cali- fornia 1975 projections for milk and eggs are based primarily on projected Cali- fornia population growth to 23.6 million by 1975. Other livestock projections are based primarily on past trends and evalu- ation of future developments. Quantitative results. Taking 1954-1957 as the base period from which projec- tions have been made, acreage in crop- land is projected to increase about 0.8 million acres by 1975. Cotton is projected to increase by 0.52 million acres, fruits by 0.35 million acres, feed grains by 0.30 million acres and vegetables by 0.15 million acres. Food grains are projected to decrease by 0.13 million acres and beans by 0.05 million acres. Double crop- [2 ping is expected to increase and less crop- land is expected to lie idle or in fallow. The 1975 livestock projections include 40 per cent more dairy cows, 60 per cent more hens, little changes in numbers of turkeys, broilers and beef cattle, a 10 per cent decline in sheep and lambs and nearly a 50 per cent decline in hog num- bers. Comparison of projected feed- grain production with livestock utiliza tion indicates a continued deficit of nearly 1 million tons of feed grains to be met by inshipments. However, con- tinued large grain shipments might be questioned; inshipment of finished live- stock products may be more economic in the long run. Furthermore, the in- creased acreage of both cotton and feed grains in the San Joaquin Valley may be questioned. If feed-grain production falls short of the projected 32 per cent in- crease, an even larger feed-grain deficit in California is indicated. Cattle feeding would seem to be one type of livestock enterprise likely to decline from the pro- jected levels if these conditions develop. The projections indicate a substantial in- crease in hay inshipments as well as a 4 per cent increase in hay acreage to meet 1975 livestock requirements. Pasture and grazing requirements would be increased 8 per cent, which would be met on 5 per cent fewer pasture acres with a 14 per cent increase in range productivity per acre. Land and water requirements. Compar- ison of these projections with Califor- nia's projected land and water base indicates that the above changes are feasible. While an additional 1.2 million acres in land-use classes I-IV are pro- jected to be converted to nonagricultural uses by 1975, sufficient class I-IV acre- age remains to nearly adequately meet projected crop requirements. Some ad- ditional land now in range, dry pasture land and desert is expected to move into the cropland category to meet the crop acreages projected. The projections of this study compare quite closely with projected 1975 land utilization estimated independently by a recent conservation needs study conducted by state and county committees under the chairman- ship of the Soil Conservation Service. The study estimates an 18 per cent in- crease in irrigated cropland, about equally divided between the Sacramento Valley, the San Joaquin Valley and Southern California. Further water- resource development will be required to meet these projected increases in irri- gated acreage. Management changes. Changes in ag- gregate output and its composition as projected will have an important impact on the organization, management and ownership of individual farms in Cali- fornia. Increases in farm size — both in land per farm and output per farm — are expected to continue to 1975. Shifts to larger farms are expected to increase over-all productivity of the resources em- ployed. Capital-labor substitution is ex- pected to continue at an accelerated pace as new and improved machines supplant hand labor in crops which are at present labor intensive. Labor inputs in Califor- nia agriculture will continue to decline relative to capital inputs, and probably in absolute numbers as well. Production credit will probably increase with the average loan increasing in size. Part- ownership and tenant-specialization in particular crops have increased recently and will probably continue. Integration of production with processing, market- ing and/or factor supply represents an- other development finding widespread application in California. An increase in the corporate form of business, particu- larly on family-operated farms, is ex- pected in California. Use by management of specialists such as soils technicians, irrigation engineers, etc., as permanent members of the labor force is increasing. Greater dependence on other specialists such as accountants, lawyers and pos- sibly professional farm managers can be expected. [3] CONTENTS 5 INTRODUCTION 6 OBJECTIVES 6 BASIS OF PROJECTION 6 General Methods and Assumptions 7 Procedures for Projecting Crop and Livestock Production 9 PROJECTIONS 9 Crop Projections for California, 1975 9 State production, yield and acreage projections 14 Changes in yields, acreages and location of crop production 14 Feed grains 15 16 Food grains Fruits 17 19 Vegetables Potatoes 19 Dry edible beans 20 20 Sugar beets Cotton 20 Tree nuts 21 23 Livestock Projections for California, 1975 Dairy cattle 23 25 26 27 27 Poultry Beef cattle Sheep and lambs Hogs Projected Feed-Livestock Balance in California 31 Projected Land and Water Resources and Agricultural Requirements in California, 1975 31 Land Resources 36 Water Resources 38 Projected Adjustments in Farm Organization and Management in California 38 Changes in levels and combinations of resources on California farms 44 I Farm business control and management 47 APPENDIX 58 1 LITERATURE CITED APRIL, 1961 THE AUTHORS G. W. DEAN is Assistant Professor of Agricultural Economics, Assistant Agricultural Economist in the Experiment Station and on the Giannini Foundation, Davis. C. O. McCORKLE, JR., is Associate Professor of Agricultural Economics, Associate Agricultural Economist in the Experiment Station and on the Giannini Foundation, Davis. [4] PROJECTIONS RELATING TO CALIFORNIA AGRICULTURE IN 1975 1 G. W. DEAN and C. O. McCORKLE, JR. INTRODUCTION Aremendous changes have taken place in California since 1940. Population has nearly tripled. Industrialization has de- veloped at an accelerated pace. With the population and industrial boom have come attendant pressures on the state's agricultural economy. Pressure on land and water resources are among the fore- most problems of California agriculture. Urbanization and industrialization in the Los Angeles and San Francisco Bay metropolitan centers as well as in other central and southern coastal valleys have removed large blocks of high-quality farm land from agricultural use. Land values and taxes in surrounding areas have often been forced to levels unjus- tified by strictly agricultural pursuits. Human and industrial users of water compete strongly with irrigation in some areas and threaten to make water prob- lems in the future even more critical. Intensified interest in watershed man- agement and increased demands for ex- panded recreational facilities have in- creased the competition for rangeland and forests. To be more competitive with urban employment, farm labor wage rates have been forced above levels considered economic by some California farmers, 1 The research project on which this report is based has been financed in part by funds allocated to Project RRF 1813, California's contributing project to Regional Research Pro- ject WM-54. Manuscript submitted for publica- tion, May 1960. many of whom specialize in crops with extremely high labor requirements. These and other forces have resulted in Cali- fornia farms becoming highly specialized and mechanized. Yet, certain commodity groups such as fruits and vegetables are still among the highest labor-consuming crops in the nation. At the same time the demand for prod- ucts of California agriculture, particu- larly those in which California has a unique climatic advantage, has expanded rapidly, and is likely to continue to do so. In this context, these questions are posed: Will state land and water re- sources allow California to meet demands for its agricultural products in the fu- ture? What changes in cropping patterns and livestock production must be made to satisfy these demands? What implica- tions do these changes have for the oper- ation of individual farms within the state? The only certainty about future Cali- fornia agriculture is that it will be char- acterized by dynamic change. Yet farm- ers, businessmen in industries related to agriculture, and government officials pe- riodically make decisions based on as- sumptions, explicit or implicit, about future changes in California agriculture. Clearly these decisions should be based on the best possible information avail- able. This bulletin offers information which may prove useful in decision-mak- ing at farm, business and governmental levels. [5] OBJECTIVES >\^>^jy<~- J. his study discusses probable develop- ments in California agriculture by 1975. 2 Specifically, the objectives are to make the following projections for California agriculture in 1975: • Acreage, yield, and total production of the maj or crops ; • Numbers and production of the ma- jor types of livestock; • General shifts in location of crop and livestock production within California; • Changes likely to occur on individ- ual farms. .%'i-"-' BASIS OF PROJECTION General Methods and Assumptions Xhe conventional quantitative tools of economic analysis (demand-supply anal- ysis, input-output analysis, linear pro- gramming, etc.) are oriented primarily toward short-run analyses. The dubious applicability of these tools for long-run analyses has been examined elsewhere (Dean and McCorkle, 1958, and Daly, 1954). Therefore, this study employs a "synthetic" method of analysis along the lines followed in studies by Daly (1956) and Barton and Rogers (1956). The so- called synthetic method includes both quantitative and qualitative elements. While an enormous body of quantitative data and statistical relationships are used, the analysis relies heavily on judg- ments of specialists in many diverse phases of agricultural research. Unfor- tunately, results from such analysis are not always quantitative or subject to statements regarding standard errors or confidence limits. Yet even approxima- tions as to directions and magnitudes of change often aid in long-range planning. 2 The year 1975 was selected to coincide with the target year for the projections by the United States Department of Agriculture. Agricultural adjustments in California are highly interdependent with develop- ments in the general economy. The lev " of general economic activity influenc state industrial activity, migration intr California, consumer incomes and tin national and state demand for Califor- nia's agricultural products. Thus, projec- tions in this study proceed within a specific framework of assumptions re- garding the U. S. and world economies. 3 These assumptions are (Daly, 1956, and Barton and Rogers, 1956) : 1. U. S. population will increase to 230 million people by 1975. 2. The U. S. labor force and employ- ment will grow commensurately with population growth. 3. Productivity of the labor force to trend upward at a rate of about 2% per cent per year. 4. A trend toward world peace, with a smaller proportion of the national product devoted to defense pur- poses. 3 In keeping with standard terminology, the word projection rather than prediction is used throughout this study, recognizing the depend- ence on specific underlying assumptions of population, income and other economic vari- ables. [6] 5. Real income per capita to increase about 60 per cent between 1953 and 1975. 6. Income elasticities of consumption based on empirical studies and ad- justed for higher income levels to reflect 1975 consumption habits. 7. A continuation of trends in popular consumption habits. 8. The volume of agricultural exports for 1975 to be about one-sixth above 1952-1953. 9. Prices in general to remain at ap- proximately current levels both for agriculture and the economy as a whole. Within this framework of assump- tions, two major sets of California pro- jections are made — one for crops, the other for livestock. Though crop and livestock production obviously are inter- dependent, the two sets of projections are eloped independently, first for crops ,nd then for livestock. Two considera- ons suggest this procedure: (1) In general, high value crops such as cotton, fruits and vegetables can outcompete hay and feed grains for the use of irrigated land in California. Thus, hay and grain — the backbone of the livestock industry — become almost "residual claimants" to land not used in the production of higher- value crops. Consequently, California livestock production is probably more nearly dependent on crop production than vice versa. (2) The basis for pro- jecting crop production differs from that used for livestock. California crop pro- duction is assumed to be largely de- pendent on nationwide demand, while livestock production (particularly dairy and poultry production) is assumed to be primarily dependent on California demand. Procedures for Projecting Crop and Livestock Production California produces many crops for a nationwide market, often being the major or sole producer in the United States. Therefore, California agriculture is heav- ily dependent on the U. S. demand for farm products. Projections of U. S. out- put required to meet 1975 projected crop demands serve as the initial step in de- riving 1975 California crop output re- quirements. Changes in the long-run demand for farm products depend primarily on pop- ulation growth and changes in per-capita consumption resulting from changes in consumer incomes and tastes. Population growth is the major demand shifter for the aggregate of all foods. However, de- mands for individual foods and there- fore individual crops vary widely as a function of changing per-capita con- sumption. A projected 60 per cent in- crease in consumer incomes and an assumed continuation of popular food consumption trends unrelated to income changes are the major factors influenc- ing projected 1975 per-capita consump- tion patterns. As incomes rise, consumers tend to purchase relatively more of prod- ucts such as fruits and vegetables and less of other products such as cereals, potatoes and dry edible beans. Quantifi- cation of this phenomenon is provided in empirical estimates of income elasticities of demand.* Popular consumption trends are exemplified by the shift toward frozen and processed foods. In table 1, projection A estimates the U. S. output (1953 = 100) of major crops required to meet 1975 demands as pro- jected by Daly (1956). Projection A is based on a 1975 U. S. population of 210 million; projection B is 10 per cent higher to correspond to the 230 million 4 Income elasticity of demand is denned as the percentage change in quantity demanded per 1 per cent change in per-capita income, the in- fluence of other variables held constant. The income elasticities for many farm products are positive; i.e., as real incomes rise, per-capita consumption increases. However, certain farm products such as wheat, dry beans, potatoes, and sugar exhibit negative income elasticities of demand — income and per-capita consump- tion changes are negatively correlated. [7] Table 1 UNITED STATES OUTPUT OF MAJOE CROPS NEEDED TO MEET PRO- JECTED DEMAND REQUIRE- MENTS FOR 1975 (1953 = 100) Crop Category Feed grainst Food grains§ Rice Wheat Fruits Apples Citrus|| Grapes^ Other** Vegetables Tomatoes Leafy-green and yellow ft Other Jt Potatoes Dry edible beans Sugar Cotton Tree nuts Walnuts^ Almonds! 1953 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 1975 Projection A* 135 82 94 81 141 129 176 135 141 165 142 131 102 99 101 117 Bt 148 90 103 89 155 142 194 164 148 155 181 156 144 112 109 111 129 156 143 * Projection A from Daly (1956), table 10, 1975 Pro- jection II. These projections are based on a 1975 United States population of 210 million, a 60 per cent increase in real per-capita income from 1953 to 1975 and a con- tinuation of trends in popular consumption habits. t Projection B estimates 10 per cent higher than Pro- jection A estimates, based on a 1975 United States population of 230 million. All other assumptions the same as under 1975 Projection A. t Includes corn, oats, barley, and grain sorghums. § Includes wheat, rice, rye, and buckwheat. || Includes grapefruit, oranges and lemons. 1 Projections made by the authors specifically for this study. ** Includes apricots, avocados, cherries, dates, figs, nectarines, olives, peaches, pears, plums, prunes and strawberries. tt Includes artichokes, asparagus, lima beans, snap beans, broccoli, brussels sprouts, cabbage, carrots, kale, escarole, lettuce, green peas, green peppers, spinach and estimated minor leafy-green and yellow vegetables. tt Includes beets, cauliflower, celery, sweet corn, cucumbers, eggplant, garlic, onions, shallots and esti- mated minor vegetables. population assumption of this study. All other assumptions remain unchanged. The wide variation in percentage changes in projected output among crops is at- tributable primarily to the different in- come elasticities of demand discussed above (table 2, Daly, 1956). Daly's esti- mates are restricted to important United States farm products. Additional output projections are developed for other crops which are important in California (grapes, walnuts and almonds). The lat- ter are based on trend projections of per capita consumption, conversion to total consumption based on a 1975 U. S. pop- ulation of 230 million, and adjustments for expected export-import balances in 1975. Projection B, table 1 is employed exclusively in this study. The U. S. crop projections by Daly (table 1) are taken as a point of depar- ture in making California crop projec- tions. The problem is to translate the required output of United States farm products into required output of Califor- nia farm products. Conceptually, an interregional competition model with California as one region would provide estimates of California's share of total United States production required to meet 1975 aggregate demand. The sta- tistical and data requirements for imple- menting such a model, however, appear prohibitive for this study. Consequently, two alternative assumptions are made: (a) that California will produce the same share of total U. S. crop production in 1975 as its average annual share from 1954^1957; (b) that California will pro- duce a changing share of total United States crop production over time, based on a projection of California's histori- cal share of U. S. production. The consequences of these two alternative assumptions are carried through a maj or portion of the analysis. Given the required output of Califor- nia farm products to meet 1975 demands (as derived above), the remaining steps in making crop projections are as fol- lows: (1) Most probable yields of individual California crops in 1975 are estimated by crop-production specialists. (2) California total production and [8] yield projections for each crop are com- bined to estimate California acreages of individual crops required to meet 1975 demands. (3) Probable future shifts in the lo- cation of crop production within the state are estimated from past and current trends. California livestock projections for 1975 are derived as follows: 1. Outputs to meet 1975 demand for individual California livestock products are determined. Fluid-milk and egg re- quirements of California in 1975 are assumed to be met by state production. Total state output of turkeys, broilers, beef cattle, sheep and hogs are estimated individually, primarily on the basis of past trends and judgment of future pros- pects. 2. Production per animal or bird is projected to 1975 by livestock -produc- tion specialists. 3. Total production and per-animal production are combined to estimate 1975 livestock and poultry numbers. 4. Feed requirements per animal or bird are projected to 1975. 5. Total 1975 livestock feed require- ments for California are determined. Crop and livestock projections then are integrated to estimate the feed-live- stock balance in California in 1975 and to compare implied resource require- ments with California's projected 1975 land and water resource base. Finally, impacts of the crop and livestock projec- tions are traced to expected individual farm adjustments in such characteristics as size, organization, and ownership. The methodology discussed above can be summarized as follows: A known ag- gregate demand structure and corres- ponding U. S. production to meet these demands is assumed. The relative and absolute shares of output required from California then are derived, using a com- bination of arithmetic, statistical and judgment procedures. California agricul- ture is assumed to produce the combina- tion and magnitudes of the various prod- ucts to meet these 1975 projected output requirements. Thus the economic system is presumed sufficiently flexible to equate quantity supplied with requirements — perhaps a reasonable assumption over a period as long as 15 years. PROJECTIONS Crop Projections for California, 1975 State production, yield and acreage projections J. able 2 provides a summary of pro- jected indexes (1954-1957 = 100) of California crop production, yields per acre and acreages under two alternative assumptions. Projection A, table 2 is based on the assumption that California will produce the same percentage share of U. S. production of each crop as in [ the base period 1954^-1957. Projection B, table 2 assumes that California will produce a share of U. S. production based on a projection of California's historical share; in general, the latter projection shows California producing a changed share of U. S. production in 1975 relative to the 1954^1957 base period. Sizable differences in 1975 Cali- fornia output projections arise from the alternative share assumptions of table 2. Obviously, greatest differences occur where California's projected share of U. S. production in 1975 is substantially 9] M En = * go £ ii " En Q ° ^ O H « go o o O M P <1 A W O OQ OS §? 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C« ° « J O g g2 — ^ tS CD© jo a:^ e li 03 3 a -a &£co 3 c3 C^-O CD -3 a; M43 §gi3 G © ~ — ^ 0^© c^<-~ o-tf data fr icemei Ik cow of 1,2 ased o ltis an unds o 2 C,0 ^ O 3 a °lggS O 0) T3 jo & 3 03 S gg'ggS ffl , U SPh 03^^ ^^^++0 a CO H > Q 'J O CO ^ "C CD Dairy cattle The 1975 dairy projections are based on a concurrent study of the dairy in- dustry in the western states by Simmons (1959). Simmons projects per-capita consumption of fluid milk, butter, ice cream, etc. to 1975 using methods similar to those employed by Daly (1956) in deriving U. S. demand for farm products. Assuming a 1975 California population of 23.6 million, Simmons estimates total fluid-milk production in California (state fluid-milk consumption plus fluid-milk export during peak production seasons) at 12,583 million pounds. Average pro- duction per cow in California is pro- jected to increase 21 per cent to 10,400 pounds by 1975. At this production rate, 1,209,900 cows are required in Cali- fornia to meet 1975 fluid-milk needs — an increase in cow numbers of 40 per cent from the 1954^1957 average. Manu- factured-milk requirements are assumed to be met by out-of-state production in 1975. Details of the projected 1975 Cali- fornia dairy-cattle numbers and dairy- feed requirements are shown in table 4. Grain, hay and pasture requirements per animal are extremely difficult to project to 1975. Even accurate estimates of present feeding rates in the state are not available. In brief, a level of con- centrate feeding sufficient to produce 10,400 pounds of milk per cow per year under conditions in present Grade-A dairies was assumed as the state average requirement for 1975. Compared with other areas, grains comprise a relatively smaller proportion of the total concen- trates fed to dairy cows in California, primarily because of the availability of large volumes of by-product feeds such as cottonseed meal and beet pulp. Some question that 7 pounds of grain per cow per day is sufficient to support average milk production of 10,400 pounds per cow. Several factors support the feasi- bility of this assumption: (1) A larger proportion of future dairy production in California is expected to concentrate in the San Joaquin Valley, where grain- forage price ratios favor high forage rations. (2) Many operators in the San Joaquin Valley presently are obtaining 10,400-pound averages per cow with concentrate mixes containing only 7 pounds of grain per head per day or less. (3) Dairymen are feeding top- quality hay to their cows. (4) Further shifts toward drylot dairy operations permit greater attention to the care and health of the animals. 11 Total grain, hay and pasture and grazing requirements for the 1975 projected California dairy industry are computed in table 4. Along with comparable estimates for beef cat- tle, poultry, sheep and hogs, the aggre- gate feed production-livestock consump- tion balance in California for 1975 can be projected. Poultry The California poultry industry is comprised of three distinct enterprises: egg production, turkey production, and broiler and fryer production. Separate projections are made for each. Egg production. During the past 10 years the apparent per-capita egg con- sumption has been about the same for California as for the United States. Therefore, Daly's (1956) 1975 projec- tion of 403 eggs per capita for the United States has been adopted as the 1975 California consumption rate (table 5). Inshipments of shell eggs as a per- centage of total California egg consump- tion have declined steadily from 18 per cent in 1949 to 7 per cent in 1958. Present outshipments of eggs from Cali- fornia are unknown, but apparently are significant only at certain times during the year. With inshipments only 7 per cent and trending downward and with small exports, egg production is assumed 11 Source : Davidson, Jack R., personal inter- views with farmers in the San Joaquin Valley, 1959 (unpublished data), California project 1808. [23] ft o ft ^ o ^ Ph ^ ft S o 4 lO O JS a ft 3 pq < 3 ft En 1-1 Fh ft §> ft O Ph Ph c o a u "B a; u M o fin w California population millions 13.2 23.6 a. b cc a > OS «: a- ■j c a 'c C >c o 4 ft t-i o H T) CV 1 o «3 _ • .tj ^ O o S «2<~ .3 <" si, ^ o <£ 5 ai? jg ^ ga° s ■g S a^-s SSSggS ^ "3 ■I 8§ 03 » Q.Sgc CT5.3 te l*3j 03 — M C 0,3 3 3 £ , s' a ft S3 C -Q w > o>_ • •-• OT3 3 §° Q I Us- 0-33.2 O oo;3 § c3<2 ffi a.-s 5 >>§ ga An O^.S S2§S: a S 8 3 >i§ ft w ft fr ft £ < ^ % o o 1— 1 HH PI H D ft ft O P3 P4 c a On t- w >H C3i w 1 M lO w OS ft T— 1 EH w 1— 1 Eh H O i— i X EH ft W ^ ^ o H >o M i— i 35 ft rH OP ft Pi t- C Is 05 o _o CO o lO CSI CO CO s aj 3 , Sh o* t3 a) © o3'C -M- a; a; ^ -e el ^ajo S o o 1 Pm«3 a -o fe fe aj 3 m 00 s o «7= W= IC o fe^ a Ph =•§1 g g CM O id (M CX) 00 73 rj S -e .fcj.S cl 8 OO CD s CO CO •'ol'ol ■■«: jg-O rage ght bird Bed 13 S t^ t^ ®'7n . •-* s 00 OO ^i| S Cali- urkey ction eight is) s2 CO ^h" e 2 CM OO — 3 P 3 CM l^ CM — o c 2 > CM CM ■ fcPi-13 1 Cali- turke mptio weigh ,sis) jg o o S O CM CM CO Tota fornia consu (live ba 05 CO o r^ -^ a u .2 ©5^0 "53 O CM er-ca rkey impt (liv weig basi s CO CO PmJ E 03 C .a o •2 CM CO ?a 3 'S a <-> a 1 CO CO i— I CM c3 2 a § «s8.2 a 'SID ! 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CD C H G 2 *>> o G CD > _G 60 G t3 G a3 .2 G g ••a '3 q 'Si CD ^ 3 "3 ^2 P-H O H .^ > O Cj ^ K J3 '■p ° o » h .• e «, ajgfflfnOHfeO < C S a _G cp 1 G O o G -a o ffl Ph fe ^ w £ K .2 o g • a q3 0.~ a) -t-s o .5 s s 03 6X „iL- ■s s "G 53 53C10 O 03--. c3 £J -03 OO r" ■— 1 ?". 3 OS.S^JO § -Sh£«£ ^^ o-S »-g sufficient grain imported to feed out these animals, a substantial decline in the state feedlot industry would be indicated. 2. If cotton acreage expands in the San Joaquin Valley to its former level of about 1.3 million acres as projected in table 3, a 32 per cent increase in state feed grain production is improbable. Under the alternative assumption that California feed-grain production remains at the 1954-1957 level of about 2,513,000 tons, the 1975 deficit would increase to about 1,671,000 tons; such a high level of net inshipments seems improbable. Under this set of circumstances, feed- grain supplies would likely further re- strict state livestock production. Again, beef-cattle feeding appears most vulner- able. An additional deterrent to cattle feeding in California is the possible ad- justment in freight rates favoring inship- ments of dressed meat relative to live animals. Table 12 compares hay and pasture and grazing production with livestock feed utilization in California for the 1954—1957 period and projected for 1975. During the 1954-1957 period average annual net inshipments of hay into California are estimated at 584,000 tons. 16 Hay requirements for livestock in California are projected to increase about 25 per cent (from 7,310,000 tons to 9,133,000 tons) between 1954-1957 and 1975. Imports of hay into California, mainly from Arizona, are assumed to increase from 584,000 tons to 850,000 tons by 1975. Thus, state hay production would have to reach 8,283,000 tons (a 24 per cent increase) to meet feed re- quirements in 1975. Average hay yields are expected to increase from 3.36 to about 4.0 tons per acre by 1975, mainly through a continued relative shift to 16 Since data on inshipments are unavailable, inshipments are computed as a residual con- sidering inventories, production and feed utili- zation. For comparison, see McGlothlin (1957) who estimates 1954 net inshipments of hay into California at 159,000 tons. alfalfa and other tame hay. Still, hay acreage would have to increase about 4 per cent or 80,000 acres to meet require- ments. Pasture and grazing requirements are projected to increase only about 8 per cent (from 30,225,000 to 32,535,000 animal unit months) ; this increase should be met through continued pasture and range improvement even though total acreage grazed may decline slightly. Higher hay requirements relative to pasture requirements in 1975 reflect in- creases in dairy cattle compared with beef cattle and sheep. On the basis of the pasture and grazing capacity in California, the state range- livestock industry appears able to ap- proximately maintain present numbers until 1975. Competition for rangeland by recreation and other purposes is expected to be at least offset by brush clearance, fertilization and other forms of range improvement. However, the livestock finishing industries, which rely heavily on feed grains, may be more nearly limited by 1975 to livestock and feed grains raised within California than at present. Projected Land and Water Resources and Agricultural Requirements in California, 1975 Land and water resources constitute the major physical limitations to future crop and livestock production in Cali- fornia. It is necessary, therefore, to com- pare California's 1975 projected land and water resource base with projected 1975 agricultural demands on these re- sources. Land resources Table 13 summarizes the 1954—1957 state average and 1975 projected acre- ages for the various crop categories pre- viously estimated in table 3. For the major crops projected individually in this study the 1975 projection represents about a 1.30 million-acre increase — from [31 Table 13 TOTAL ACBEAGE USED FOR CROPS, FALLOW, HAY AND CROPLAND PASTURE IN CALIFORNIA, 1954-1957 AND PROJECTED FOR 1975 Crop category State average acreage, 1954-1957* Projected state acreage 1975* 2,487,750 721,750 1,150,590 604,485 108,000 296,000 187,000 772,000 242,263 1,163,000 826,500 70,975 385,320 2,786,280 595,915 1,500,251 766,605 146,880 248,640 198,220 1,296,960 254,969 Alfalfa l,243,000t Grain, tame and wild hay % ■ Miscellaneous vegetables!. . . Miscellaneous field cropsj . . . 826,500 70,975 385,320 9,015,633 500,000 10,320,515 Double cropped acres§. . . . 750,000 8,515,633 1,885,367|| 800,750 2,027,958 9,570,515 Cropland idle or fallow . Irrigated pasture! Other cropland for 1,700,0001 800,750 2,027,958 TOTAL 13,229,708 14,099,223 * Crops from feed grains through tree nuts estimated in table 3. t Estimated in section on feed-livestock balance. t 1975 acreage assumed equal to 1954-1957. § Estimated by authors. Double cropped acres in- clude land with two or more crops (e.g., barley-milo, alfalfa hay-alfalfa seed, intertilled crops in orchards). || 1954 Census of Agriculture for California. i Assumed to decrease by 1975 because of increased irrigation. 9,015,633 acres to 10,320,515 acres. About 0.52 million acres of this increase is accounted for by cotton alone, 0.35 million acres by fruits, 0.30 by feed grains and 0.15 by vegetables. However, double cropping is expected to increase by about 250,000 acres, making the net acreage increase only about one million acres. 17 The remaining categories of crops in table 13 are estimated. Cropland idle or fallow is expected to decline with in- 17 In this discussion double cropping repre- sents any land which is reported for more than one crop during the year (for example, barley- milo, alfalfa hay-alfalfa seed, intertilled crops in orchards, etc.). creased irrigation. Irrigated pasture is assumed to remain at the 1954^1957 level, although if cotton and feed grains do not expand to the acreage projected, irrigated pasture might increase. While there is much land in the state where shallow soils preclude cultivated crop production but which are suited to irri- gated pasture, high water costs are likely to prevent their development for this use. Meat production on irrigated pasture will be profitable only where water costs are relatively low or production turnofT relatively high. Large quantities of dressed meats are already moving into California under present relative price and cost conditions. With the opportuni- ties for livestock feeding in the South- west and Great Plains regions it is diffi- cult to foresee an increase in meat pro- duction on high-cost irrigated pasture under any likely set of price relation- ships. Total projected acreage of all cropland is about 14 million acres in 1975 compared with about 13.2 million acres in 1954-1957. The above projections are now com- pared with land resources of the state available for agriculture in 1975. Table 14 indicates the basic land resources and land converted to nonagricultural pur- poses in California prior to 1955 and projected for 1975. About 17.5 million acres in land-use classes I-IV are avail- able in California. 18 Prior to 1955, almost 2.8 million acres of this land had been converted to nonagricultural purposes. At the 1942-1955 annual rate of con- version, an additional 1.2 million acres is projected to be converted by 1975. If so, only 13.6 million acres in land-use classes I-IV will remain for agricultural purposes. As indicated by table 14, con- versions will be greatest in Southern California and the Central Coast where almost one-half and one-third of the I-IV 18 Land Use Capability classes as defined by the Soil Conservation Service in terms of their suitability for cultivation with varying degrees of limitation in use. 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Thus, the acre- age of I-IV land remaining for agri- cultural purposes in 1975 (13.6 million acres) is slightly less than cropland requirements projected (14.0 million acres). However, additional land now in land classes V-VIII (range and dry pasture land as well as some desert land) is expected to move into the cropland category through new irrigation de- velopments. It thus appears that Cali- fornia's land resources are adequate to meet the crop acreages projected. Fortunately, it is possible to compare the over-all land-use projections of this study with a recent conservation needs study 19 in California. Comparison with these estimates is particularly useful be- cause completely different projection techniques were used. During 1958-1959 a county-by-county study of soil and water conservation needs was completed in California. Estimates of land in vari- ous types of utilization were derived for 1959 and projected to 1975. These esti- mates evolved from a series of committee meetings of key agricultural people in each county of California. County sub- committees were established to study various phases of the land use inventory and projection for the particular county; final estimates for each county were com- piled as a composite analysis and judg- ment of the entire county committee. The county estimates have been reviewed and revised to some extent at the state level but are subject to review and possible further revision both by the state and national Soil and Water Conservations Needs committees. A summary of the preliminary results of the conservation needs study is pre- sented in table 15. The over- all changes in cropland acreages by 1975 as pro- jected by this study are strikingly close 19 This study was part of a National Inventory of Soil and Water Conservation Needs con- ducted by state and county committees under the chairmanship of SCS. to those derived in this study. The study projects an increase in total cropland by 1975 of 5 per cent or about 0.6 million acres; the present study projects a total cropland increase of about 7 per cent or 0.8 million acres (table 13 ). 20 The present study may slightly underestimate yield increases and therefore over- estimate required cropland acreage in 1975 for two reasons: (1) increases in irrigated cropland acreage are not ex- plicitly introduced into yield projections, yet the conservation needs study esti- mates an 18.2 per cent increase (ap- proximately 1.5 million acres) in irri- gated cropland from 1959 to 1975. (2) Increased yields from shifts in location of acreage are not explicitly included for most crops. The conservation needs study also provides 1975 projections of land in various use categories for the crop re- porting districts of the state (table 15). The Sacramento Valley, San Joaquin Valley and Southern California are pro- jected to share about equally in increases in irrigated cropland acreage — roughly 421,000, 486,000 and 447,000 acres, re- spectively. However, the estimated in- creases in Southern California depend on rapid development of desert lands, which may not completely materialize by 1975. Primarily due to loss of agri- cultural land to nonagricultural uses, irrigated cropland in the Central Coast is projected to decline about 145,000 acres (24 per cent) by 1975. Percentage increases in irrigation elsewhere in the state are large, but account for a minor part of the total increase. Nonirrigated cropland is projected to decline in every major area of the state, with a total state decline of about 0.9 million acres (22 per cent). The conservation needs study projects approximately a 5 per cent acreage de- crease both in pasture and range and in 20 Differences in the base acreage in the two studies are accounted for primarily by slightly different definitions of cropland. [35] forest and woodland used for grazing (table 15). The 8 per cent increase in pasture requirements for livestock pro- jected earlier (table 14) would therefore imply a needed 14 per cent increase in productivity per acre in grazing land. Range improvement practices such as fer- tilization, brush clearing, etc., appear capable of providing this level of in- creased carrying capacity. Water resources Studies by the California Department of Water Resources indicate that Cali- fornia has sufficient water resources to meet foreseeable future needs, even under conditions of essentially complete, or ul- timate, development. Annual average runoff is nearly 71 million acre-feet while state water requirements now are only slightly in excess of 25 million acre-feet. Under ultimate development, California water requirements are estimated at about 50,000,000 acre feet — still substan- tially below total runoff. The question, however, is whether the total water sup- ply can be distributed in location and time to meet these future requirements. Geographically, about 70 per cent of the stream flow occurs north of a line drawn roughly through Sacramento, yet nearly 80 per cent of present and future water consumption is estimated to be south of this line. Therefore, water must be trans- ferred from north to south. Water also must be stored to regulate flows season- ally and between years. The major stream runoff is in the winter and early spring months following winter precipitation, yet major water use is in the summer and fall. In addition, runoff fluctuates greatly between years, ranging in the past from 18,000,000 acre-feet to more than 135,000,000 acre-feet per year. Despite the fact that California pres- ently is utilizing only about one-third of the annual average runoff, there is danger of water shortages in some loca- tions in the near future without further water development. The overdraft on ground-water basins is estimated at about 5,000,000 acre-feet per season presently. The west and south side of the San Joa- quin Valley, particularly, are in need of supplemental water to reduce overdraft. Southern California will need supple- mental water by the 1970's or before, de- pending on the final decision concerning the allocation of Colorado River water. The recent recommendation would re- move all tributary waters from the allo- cation, reducing California's 44/75 share to main-stream flow only. This would limit California to approximately 3.5 million acre-feet annually. Salt-water in- trusion also is becoming a serious prob- lem, particularly in the Delta area and some coastal areas. These facts suggest the need for ex- panded water development. In the past, local areas and the federal government have been primarily responsible for con- struction work on water projects; the state's role was primarily in planning and supervision. In the future, however, the state government will play a key role in water development. The California De- partment of Water Resources has re- cently completed the California Water Plan — an engineering and resource study of water resource control, conservation and redistribution to meet future de- mands. A major feature of this plan is the Feather River project, which would provide water primarily for Southern California through the Oroville Dam, Delta facilities and an aqueduct system. While the State Legislature authorized the Feather River Project in 1951, it was first implemented only in 1956. Full de- velopment of the Feather River Project will require several decades to complete ; however, the recent approval by Califor- nian voters of the $1.75 billion bond issue facilitates beginning of construc- tion and further planning. The exact timing of this massive development will depend on success in acquiring future funds, the rate at which water demands grow, and the rate of technological prog- [36] ress achieved in alternative means of ex- panding water supplies to various users. Projection of water supplies available to various agricultural areas of Califor- nia by 1975 hinges directly on political action at the local, state and federal level. The importance of these political deci- sions for California agriculture is em- phasized by the fact that agriculture is the major water user in California; irri- gation accounted for over 19 million acre-feet, or about 90 per cent of con- sumptive water use in California in 1950. Under ultimate development, irrigation use is projected to increase to more than 41,000,000 acre-feet per season — still 80 per cent of total use. Table 16 demon- strates the dominance of irrigation in California's total water requirements. Also shown is the importance of the Cen- tral Valley, and to a lesser extent the Southern California interior valleys (Colorado Desert area), in the existing pattern of irrigation use. These two areas presently include over three-fourths of the total irrigated land in the state. As stated above, several districts within these major areas are somewhat short on current supplies and are overdrawing subsurface storage to meet needs. The 1975 land-use projections made earlier for California suggested a 5 to 7 per cent increase in total cropland and an 18 per cent increase in irrigated acre- age, mostly in the Central Valley (table 15) . Further water development is neces- sary to provide this level of increase in irrigated agriculture. Two aspects of pro- posed water development are particularly crucial for agriculture: the pricing of water for irrigation; and acreage limita- tion features. The growth of irrigated agriculture will depend to a large extent on prices charged to users. Irrigation in federal reclamation projects has typically been subsidized in varying degrees by interest- free federal loans and by power revenues. Central Valley Project water for irriga- tion sells at only about $3 per acre-foot. The Bureau of Reclamation proposes a price of $7.50 per acre-foot for the San Luis Project. The price of Feather River water is yet undetermined but cost esti- mates, including full recovery of capital with interest, have been made by the State Department of Water Resources. This cost may range from under $5 per acre-foot in the Sacramento Valley, to $15 to $20 in the San Joaquin Valley, and to $30 to $40 in Southern California. Water to agriculture priced at the latter levels may retard the pace of irrigation development except for selected high- value-per-acre crops in some selected areas. Table 16 ESTIMATED 1950 MEAN SEASONAL REQUIREMENTS FOR WATER IN CALIFORNIA, BY AREA (IN ACRE-FEET)* Hydrographic area Irrigated land Farm lots Urban and suburban areas Other water service areas Approximate totals 488,000 301 ,000 641,000 1,020,000 12,700,000 712,000 3,261,000 4,200 t 6,100 I 109,000 3,000 8,000 21,000 388,000 47,000 885,000 277,000 12,000 23,500 4,500 35,600 14,600 2,400 105,000 14,000 47,900 518,000 725 000 709,000 1,907 000 13,190,000 741 000 3,341,000 Approximate Totals 19,120,000 130,000 1,654,000 224,000 21,130,000 * Source: California Water Resources Board (1955). t Included with "Other Water Service Areas." t Included with "Urban and Suburban Areas." [37 A second important and controversial issue involves a limitation on the amount of land for which any one farmer may obtain state water. Federal reclamation projects provide for a 160-acre limita- tion (320 acres if held as community property) per farmer. However, farmers may supplement surface water by pump- ing or may lease additional acreage. Ir- rigation land which was previously unirrigated increases land values consid- erably. The Bureau of Reclamation calls this increased value "unearned enrich- ment," and therefore requires farmers using federal water to sell their excess acreage at nonspeculative prices (fixed by the Bureau) within 10 years. It is doubtful that the state water program will follow exactly the federal precedent with regard to acreage limitation per farmer. This issue is particularly rele- vant with respect to the Feather River project since much of the project's agri- cultural water will be delivered to the west side of the San Joaquin Valley where extremely large-scale farming is prevalent. A large body of high-quality soil is located in this area, and with de- velopment of a reliable, good-quality water supply, would be the area most likely to provide the acreage expansion of fruits, vegetables and cotton projected earlier in this publication (if government programs of the future will permit such expansion. Alternatives to the 160-acre limitation as a means of preventing undue enrich- ment under state water development are being studied. One suggestion would in- corporate both water pricing and acreage limitation in a single principle. It is pro- posed that revenues from Feather River project power sales be used to subsidize water cost for all purposes — agricultural, muncipal, and industrial. But, irrigation water to be applied to holdings in excess of 160 acres (320 acres if held as com- munity property) would receive no sub- sidy. Thus, water would be sold to the larger farms at a price differential ap- proximating the difference between power cost and the market value of power. Projected Adjustments in Farm Organization and Management in California Changes in aggregate output and its composition as projected above will have an important impact on the organiza- tion, management and ownership of in- dividual farms in California. Shifts in acreage and location of particular crops, shifts in the kinds of crops and livestock produced and changes in technology and methods of production are included ex- plicitly in the projections above. From these projections have been derived esti- mates of California land and water re- source requirements in 1975. Substantial changes were indicated: additional land will be removed from agricultural pro- duction and diverted to urban and indus- trial developments; other land will be developed and brought under irrigation for the first time; some range and pas- ture land will be converted to cropland; water resources will need further devel- opment to meet agricultural, urban and industrial uses. Within this context of highly complex change, the organization and management of individual farms ob- viously can not and will not remain static. Broadly outlined below are some of the important changes in farm organization and management which are implied by the projections. Many of these changes are observable in well-established trends ; others are suggested by recent and cur- rent developments. Changes in levels and combinations of resources on California farms Proportions in which resources are combined on California farms have changed significantly in the past decade. These changes can be summarized briefly as the substitution of capital inputs (in the form of land, machinery, fertilizer, [38] Table 17 AVERAGE ACREAGE PER FARM IN CALIFORNIA* Area Years 1940 1945 1950 1954 1959 Crop reporting district: acres 438 514 1,007 236 323 215 422 117 acres 454 613 949 250 312 284 476 115 acres 546 767 1,079 267 326 278 469 132 acres 566 847 1,165 286 350 293 581 192 acres 601 II— North Central 886 Ill— North East 1,671 IV— Central Coast 348 386 VA — San Joaquin Valley 322 551 207 State 230 252 267 307 350 Source: California Census of Agriculture, 1940, 1945, 1950, 1954. chemicals, etc.) for labor inputs. The ex- tent of these changes and the reasons be- hind them require further examination. Farm size, however measured, has in- creased steadily in California in the past two decades. Table 17 indicates a sub- stantial increase in average land acreage per farm in every crop-reporting district in California between 1940 and 1954. For the state as a whole, the acreage per farm increased by about 50 per cent — from 230 acres to 350 acres. This change in size is due partly to new land brought under cultivation and partly to a con- solidation of existing farms into larger units with a corresponding decline in number of farms, particularly since 1950 (table 18) . Approximately 95 per cent of the decrease in farm numbers between 1950 and 1954 took place in farms under 180 acres, 63 per cent of the decline came in farms under 30 acres. These declines primarily reflect economic pressure on small farms and consequent size adjust- ments. Value of product sales is a more real- istic measure of farm size than the land input alone. Expressed in constant dol- lars, the value of product sales per farm in California was $4,908 in 1940, $6,373 in 1945, $6,417 in 1950 and $8,239 in 1954. Again, a significant increase in size of business is indicated. It is also revealing to examine the relationship of farm size to resource efficiency in Cali- fornia. Inefficient resource use concen- trates in small farms (those selling less than $5,000 worth of farm products). Table 18 NUMBER OF FARMS, CALIFORNIA 1910-1958* Year Number of farms Year Number of farms 1910. . . 88,200 89,900 91,600 93,900 96 000 98,600 101,000 104,000 108,000 113,000 118,000 120,000 123,000 126 000 130,000 136,000 139,000 142,000 144,000 145,000 145,000 145,000 145,000 144,000 1934 148,000 151 000 1911. . . 1935 1912. . 1936 149,000 148,000 1913 1937... 1914 1938 . . 145,000 1915 1939 . 143,000 1916 1940 141,000 1917 1941 141,000 1918 1942 139,000 1919 1943 140,000 1920 1944 141,000 1921 1945 142,000 1922 1946 142,000 1923 1947 143 000 1924 1948 143,000 1925 1949 144.000 1926 1950 144,000 1927 1951 142,000 1928 1952 139,000 1929 1953 137,000 1930 1931 1954 1955 136,000 134,000 1932 1933 1956 1957 1958 133,000 132,000 131,000 ' * Source: U.S. Department of Agriculture. Agri- cultural Marketing Service. Number of Farms, by States (Sp Sy). 39 These farms accounted for 11.4 per cent of the farmland in commercial farms, 18.1 per cent of the investment in land and buildings, and 22.5 per cent of the farm labor, but produced only 6.3 per cent of the total value of farm products. By comparison, large farms (sales of $25,000 or more) comprised only 14.2 per cent of all commercial farms, ac- counted for 60.9 per cent of the farm- land, 48 per cent of the value of land and buildings, utilized 44.6 per cent of the farm labor, but produced 67.6 per cent of total farm sales. Average sales per worker on the small farms were $1,999 — on the large farms $9,675 (Hopkin, 1957a) . These trends in size are expected to continue, and will probably be accom- panied by continued increases in re- source efficiency. Improved resource utilization has not been introduced ex- plicitly into the above projections and might well lower the resource require- ments projected. Farm-size increases in California have taken place primarily because of eco- nomic pressure for greater efficiency and technological advance, making larger scale farming possible. These two forces are not independent. Technological change in agriculture is ordinarily out- put increasing, causing larger supplies, lower prices and increased economic pressure for greater resource efficiency, including further technological change. Since 1950, California farmers (along with farmers elsewhere in the United States) have been faced with the conse- quence of these forces popularly referred to as the price-cost squeeze. For example, figure 1 shows that the price-cost squeeze has been steadily tightening in California since about 1952 (preliminary estimates for 1959 and 1960 indicate a continua- x C 130 120 110 100 90 80 r^ Farm output (Pacific Area) Production expenses \ Total net farm income Prices received by farmers 1945 1950 1955 1959 Fig. 1. Indexes of Farm Expenses, Output, Prices Received Gross and Net Income, California, 1944-1959 (deflated by wholesale price index, 1947-1949 = 100). Wholesale Price Index from U. S. Department of Agriculture Agricultural 1 Statistics. a U.S.D.A. (1959). b U.S.D.A. (1959a), c U.S.D.A. (1960). d Lee (1958). Data for 1955-1958 derived by authors. [40] tion of these trends). 21 Production ex- penses are seen to trend upward sharply since 1950, while prices received by farmers have trended sharply downward over the same period. A 30 per cent out- put expansion since about 1950 has been insufficient to offset the price-cost squeeze. Thus, net farm income has de- clined approximately 25 percentage points from the 1951 high; preliminary estimates for 1959 indicate a level slightly below 1958. In summary, price- cost pressure has increased for a decade in California ; there is nothing in the gen- eral agricultural situation to indicate any reversal in the near future. Price-cost pressure will continue to directly force adjustments in size and efficiency of Cali- fornia farms. Another force encouraging size expan- sion on California farms is development of new technology and related capital- labor substitutions. Table 19 itemizes productive expenses of California farm operators for 1948-1958. While expense data preclude direct comparisons of physical quantities of labor and capital items in various forms used, they do em- phasize changing proportions of capital and labor employed. Between 1949 and 1958 hired-labor expenses increased only 17 per cent, while total current operating expenses as a group increased 41 per cent. Depreciation and other consump- tion of farm capital — providing a rough index of capital investment in farm ma- chinery and equipment — increased 66 per cent over the 1949-1958 period. Hence, capital inputs (current expenses such as feed, fertilizer and livestock as well as machinery and equipment) have been substituted for labor in California agriculture over the past 10 years. Hired labor still is the largest single expense category of California farmers (table 19). Table 20 indicates the 21 Price, cost and income figures in figure 1 have been deflated by the Index of Wholesale Prices to provide a comparison with changes in the general price level in the economy. monthly average number of people work- ing on California farms, by type of worker. Since 1955 the total number of workers has declined; the major decline, because of fewer farms, has been in farm family labor. Little absolute decline is shown in hired laborers (table 20), al- though relative to capital inputs the de- cline is substantial (table 19). Labor- intensive crops in which California specializes have not allowed mechaniza- tion to the degree accomplished in other crops. The 1975 projections indicate a continuation and expansion in these types of labor-intensive specialty products. With alternative employment opportuni- ties paying wages exceeding those in agriculture, competition for labor has al- ready become severe and will probably become more intense. The farm operator in California cur- rently requiring large quantities of hired labor will have increasing difficulty meet- ing his needs. Several alternatives are available to him. For example, he may reorganize to employ a relatively con- stant labor force over the entire year and provide attractive housing, higher sala- ries and other benefits in order to acquire the quality and quantity of labor desired. A relatively constant hired year-round labor force in California from about 1954-1959 (table 20) indicates that many farmers are following this alterna- tive. Another alternative is to employ labor-saving equipment and practices, providing the farmer has sufficient capi- tal and size to justify the investment. Technological developments in planting, thinning and harvesting of many labor- intensive crops are becoming operational and undoubtedly further improvements will be forthcoming under pressure for mechanization. Already the harvest of many perishable crops, such as aspara- gus, tomatoes, grapes and some fruit, is nearing the mechanized stage. Plant breeders and propagationists, cooperat- ing with the engineers, have been active in producing plants that can be handled [41 o M < o w o oo t^ O CM h< 10 OS CO ^ OJ HI 10 C2 OO i-h ■ CC lO ■* tO IN i-H 02 02 CM »« N (N IN CO N ffl CD CM OO ri ■* CO CO CO CM CO 1— 1 h 1 IN N ifl Ol CO 02 10 02 02 t^ CM 02 CO O CO to 00 CO to 02 Hi CM (N (N CO CO t^ CO hi O CO O CO CO 00 CO y-i rt CM t ~ "- 1 HI 02 CO e O 00 I) e 00 U5 N rf IN N N 02 «) t U) T O OS IN Hi lO CO U) "5 CM CM »0 CM CO CO (N CO co 02 CO t~- to 'o CO 1— 1 1— 1 IN Hi « " H ^ *—' DO -e M «•-, 03 c? KH e .0 CO O0 O Ol l-H CO U) O0 CO O l>- tO HI 02 'I HI 1-H ^H t~- tO OO t- t^ l-H ,-H ,— 1 02 CM CM IN CO to t^ CM CO 00 CO O) W N «5 CO 1-1 i-H CM HI CO l^ CM OS 02 OO CO »C 02 CN CO a u) 1 it ii) h u) CM hi CO 00 HI ^H co 02 00 Hi O O? N N W CO N IN CN t^ 11) 00 IN 00 co CO hh H CN Tf ^ oc i— 1 CO CO CO O0 i-H c C2 t-- CM O tC H- O CO 02 t-~ CM 00 02 CM 02 C I>- CO CO 10 »o •fl t^ Ir^ CM O to O 02 O HI 0O IN OO CO CM 11 CM CO »o oc O 02 02 01 00 * •* a k CO CO 10 in 02 oc »o 02 HI HI t^ IN N IN W 0- c ffl O IN «) •* N IC tc IN N IN tC »c CM CM i-H i-h CO CM iC 1 - 01 CM -*l CM 02 02 CM l> to O -l N O CO 1 02 00 f O N IO O) CO CM 02 l-H O — 10 i ra -ji ■* io a Ifl O NIN te (M ,_, ,_, ,_, CO "o d +^ OC a a. I c a e 1 +3 CO B 1 c X cp _ a a hC -c a hi as ,B • 03 a e a C a- 1 ■8 xes on farm prope ;erest on farm mo t rent to nonfarm a & •*- — a. J B o3 "1 1 c a h e "a 1 = c a >- a. C c "S g _ 8 "2 a _> e % c c "0 6 a a ft a p. i E l Q S a 0. !2 "c T3 co ^ 3 bO -O B ^ £ inai and curi -2 s- M S"3 -3 ^^ ►^ -2 5 c 02 OS'S "S £ St aii H 03 ■asp SB 03CC " 3 — » S bfi - cS^ T3 £ £ fe © « rt ^, 73 J= b -e 00 g o3.?2 c3 ° y, black premiu , apairy s, perqu .sg •s^ t5 a 2 * OJ CD Isj^ T3 > -ggs CO fc "So M -rt B CUT3 mOifl ££0 CO S— i >— < arne nes, urse II c" .2 ^ a a 03 £)~ co" S B a> ■S8?. Kin .2 _ co » B (C.-B S CD 03 ^j o ^ S a^^ ois ^h S 0) B C „ bo — « ^ 03 £ « . ji a.S . « m b ^. - 03 ^Y B O CO 3T3-S % ».M •^ B-B^ M (-. • • cp co 2 o> 43 - Table 20 MONTHLY AVERAGE NUMBER OF PEOPLE WORKING ON CALIFORNIA FARMS, BY TYPE OF WORKER* Year Total workers! Farmers and unpaid family workers Hired year- round Hired temporary, domestic Contract foreign workers + 1945 1946 1947 1948 1949 1950 1951 1952 381,492 382,642 399,583 393,958 411,208 403,883 416,917 428,017 444,958 459,625 473,542 467,375 464,250 456,792 452,740 134,583 134,583 139,633 144,667 151,833 159,592 159,550 163,208 164,483 168,342 169,850 163,000 159,342 157,342 153,350 90,250 97,342 103,758 99,583 100,833 104,800 107,158 108,258 115,642 119,958 121,158 119,342 120,150 118,842 119,917 120,458 131,375 141,500 141,925 153,683 132,017 131,608 133,542 139,350 142,192 142,425 134,842 132,900 132,850 131,858 25,817 17,700 14,692 7,783 4,858 7,475 18,600 23,008 1953 1954 1955 25,483 29,133 40,108 1956 50,192 1957 51,858 1958 47,758 1959 47,625 * From California Annual Farm Labor Reports, 1945-1958. Preliminary estimates for 1959 from unpublished data of State of California Department of Employment. t Total for 1945 and 1946 includes prisoners of war and volunteers, j Almost entirely Mexican Nationals. mechanically, and success appears to be near for several crops. Following is a quote concerning trends in mechaniza- tion and farming methods in California from the California Annual Farm Labor Report {1957 ). 22 "New or improved equipment, devices, ma- terials, and methods continued to appear in experimental trials and demonstrations to foretell future labor saving and im- proved farming. University and college departments of agricultural engineering, along with commodity organizations, equip- ment companies, and ingenious farmers — all have contributed to the innovations. Working with these forces have been the horticultural specialists engaged in devel- opment of improved crop varieties and more sturdy plants which can withstand machine thinning, harvesting, sorting, and packing. Still in the experimental stages were me- chanical developments to harvest aspara- gus, tomatoes, and grapes, including a machine which can pick up paper trays of raisins, clean and box them. Chemicals were being tried to thin tree fruits. Emerg- ing from the experimental stages were prune and walnut harvesters, and varia- 22 California Department of Employment (1958). For a summary of local mechanization trends in California see ibid. (1959). tions in vegetable planting, thinning, and field harvesting, packing and loading equipment adapted for new uses in a wider variety of crops. Proven equipment, with continued im- provement of new models, gained wider acceptance and usage by growers of cotton, sugar beets, potatoes, hay and grain and many other crops. Motorized tree squirrels were seen in more orchards during the pruning season, and more growers were providing their pruners with pneumatic cutters, to lighten and speed up the task of pruning of trees and vines. To mechanize the picking of fruits from trees and vines was still a challenge, but labor saving made progress in orchards and vineyards through the use of new con- tainers, fork lifts, and bulk hauling equip- ment, which reduced the lifting, carrying, and loading of field boxes, and increased worker output and efficiency. There was more widespread use of the tractor-drawn gondola for bulk transport- ing of wine grapes out of the vineyards. In Tulare County, there was also experi- mental use of the gondola in the orange and lemon harvests. A Butte County grower tried bulk handling of canning peaches with considerable suc- cess. The picked fruit was put into large containers, without any sorting in the or- chard. A fork lift conveyed the containers onto a wagon for haulins to the sorting shed." [43] This statement summarizes briefly the tremendous effort underway to mecha- nize labor-intensive crops in California. Recent developments indicate that the labor force in California agriculture will continue to decline relative to capital in- puts, and possibly in absolute numbers as well. Use of capital as a partial substitute for labor suggests an examination of fu- ture agricultural capital requirements in California. With increased intensification in agriculture, greater capital inputs per acre will be required. The past up-trend in use of production credit in California (table 21, col. 1) is expected to continue. Loans per farmer will be larger; table 21 indicates that the number of PCA loans per year has been about constant for the past decade, yet total amount loaned has approximately doubled. Production credit undoubtedly will be available either from primary or secondary sources, though expected shifts toward crops with high variability in net income (vegetables and fruits, for example) will cause lenders to require added security for loans. Sales contracts, grower-proces- sor integration, crop diversification and other means of reducing income variation will be encouraged by lending agencies. Farm business control and management Several developments in California ag- riculture suggest likely trends in future farm business control and management. These developments include changes in tenancy, contracting for services and out- lets, integration of various types, and business organization. Table 22 shows relative changes in farm tenure in California since 1940. Most prominent are increases in the per- centage of owners, particularly part- owners, with a corresponding decline in the percentage of tenants. Increases in the percentage of part-owners reflect in part the effort of owners to expand oper- ations. Expansion is often possible only through renting additional land, some- Table 21 FARM CREDIT IN CALIFORNIA 1946-1959* Non-real- estate farm credit January If PCA Year No. of loans made during yr. Amount of loans made during yr. 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 in $1 ,000 160,694 218,421 191,381 296,214 297,465 300,711 265,662 246,739 297,197 297,779 324,910 409,719 4,832 5,552 5,944 6,333 6,544 6,768 6,776 6,446 6,598 6,318 6,573 6,599 6,747 in $1,000 42,031 50,889 57,718 55,655 62,333 80,553 86,560 78,612 78,437 82,594 95,343 109,538 130,155 * Source: Farm Credit in California, Agricultural Commission, American Bankers Association, New York. t Before 1952, includes farm production loans from commercial banks, loans from Federal Land Banks and loans from Farmers Home Administration for produc- tion and subsistence; after 1952, includes non-real estate loans by Banks, PCA's and Farmers Home Adminis- tration. Table 22 RELATIVE IMPORTANCE OF TYPES OF TENURE IN CALIFORNIA* Year Per cent owners Per cent part- owners Per cent tenants Per cent man- agers 1940 1945 1950 67.6 73 4 73.5 72.2 10.5 10.2 13.4 14.9 19.1 12.3 11.9 11.2 2.8 3.4 1.9 1954 1.6 * Source: California Census of Agriculture, 1940, 1945, 1950, 1954. times at considerable distances from the owned property, making the transporta- tion of workers and equipment an addi- tional cost and management problem. Farmers expanding in this fashion often find that the economies of size obtained more than offset the transportation and management problems created. Expan- sion of farm size through part-ownership appears to be nationwide, and probably will continue in California. The percentage of tenant farmers in California has dropped substantially since 1940 (table 22). However, one [44] type of tenancy in California has become more important and may increase: where the tenant specializes in the production of one or two commodities, leasing land from season to season on a share or cash basis. Most of his investment capital is in machinery and equipment. Other farmers own the land and farm the rota- tion crops. This permits accumulation and concentration of skills in producing intensively farmed crops and reduces the capital required by the producer. Tech- nical specialists provide assistance either on a fee basis or as a service made avail- able by supply companies or processors. Further specialization in agriculture, both as to types of products and produc- tion methods, may lead to increased num- bers of tenant farmers and technical consultants of the type described. Integration of production with proc- essing, marketing and/or factor supply represents another development rinding widespread application in California. Two types of integration are prevalent. First is the conventional contractual ar- rangement between the producer and the processor. Second, the producers of a given product organize to operate the required processing facilities and either conduct their own marketing operations or contract with a marketing firm to as- sume responsibility for sales, advertis- ing, branding, transportation, and other marketing functions. Profit sharing with the marketing agency is common with this type of development. Both types of integration are found in California and will probably continue to expand. Almost all citrus fruit in the state is now handled by cooperative or- ganizations through contracts with grow- ers. Complete processing and marketing services are available to citrus growers. Tree nuts also are highly integrated through cooperatives which market the bulk of the production of walnuts and al- monds. Integrated operations are com- mon in the production, processing and marketing of vegetables and deciduous fruits, particularly in vegetables and fruits for canning and freezing. The U.S.D.A. estimates that about 90 per cent of the processing vegetables in the United States are grown by or under contract to processors (U.S.D.A., 1958). Grower- owned cooperative canneries for fruit and vegetable processing have been more important recently in California (Hoos, 1960). Although total volume handled by these cooperatives is small relative to state production, the proportion taken by cooperatives has risen sharply during the past several years. Cooperative growers are usually paid on a pooled basis influ- enced by all crops handled through the cooperative. While the grower's risk is reduced through an assured outlet, this is somewhat offset by assuming market- ing obligations formerly carried by pri- vate canneries. Another development in the processing fruit and vegetable area is the use of grower cooperative bargain- ing associations which bargain with can- neries with respect to price and other terms of trade. Processor-grower contracts also have developed for certain field crops. Sugar beets are produced under complex agree- ments providing incentives for high sugar-content beets and relating grower beet price to the price received by the processors for sugar. Processors often furnish seed, and influence production management through trained fieldmen. Considerable integration also is evident in cotton processing and marketing in California. Private gins and oil mills often supply production credit to grow- ers; cooperative gins, cottonseed oil mills and marketing associations handle a siza- ble proportion of the cotton business. Nationwide integration is probably more widespread in livestock production than in crop production. The U. S. De- partment of Agriculture estimates that about 95 per cent of the U. S. commercial broiler production is on some type of integrated basis. California's broiler and turkey industry is following this national [45 trend toward integration. The dairy in- dustry in California is highly commer- cialized, with a major proportion of milk including nearly all of the fresh milk, produced under contract. Vertical inte- gration in beef cattle in California has occurred chiefly in cattle feeding, taking the form of contract or custom feeding. Custom feeding takes primarily two forms — custom feeding for ranchers who do not want to market feeders at a sea- sonal low, and custom feeding for meat packers and chain stores who wish to maintain reliable supplies of beef fed to specifications. Some integrated hog and lamb feeding also is done in the state. Pressure for more extensive integra- tion in California agriculture will con- tinue, both from the retail-processor- supplier sector with which farmers do business, and from farmers themselves. Retailers and processors will press for contracts and other forms of integrated activity in order to maintain volume, continuous supplies and standardized quality. Suppliers will push integration to assure high-volume farm sales and continuous plant operation. Farmers themselves will continue interest in inte- gration in order to reduce price risk, as- sure market outlets, and to obtain more capital. The next 15 years may also see a marked change in form of farm business control in California. In particular, there is likely to be a marked increase in the corporate form of business. Both large and small farming corporations now exist in California, and others may de- velop due to corporate advantages in ob- taining capital, continuity of business, and tax flexibility. However, the big in- crease in corporations may be in the family corporation, where stock owner- ship and management is entirely or largely within the control of the individ- i ual farmer and his family. Here the ad- vantages of the corporate business are likely to be two fold: ease of division v and transfer of property among family members, and limited liability of the owners. Federal income tax legislation (1958) for small business corporations largely removed the tax barrier to incor- poration of small family farms. The other advantages cited may be sufficient to encourage more incorporation as fam- ily farming becomes larger, more capi- talized, and increasingly complex. < Finally, the increasing size and com- plexity of California farming will place a greater premium on high-quality farm management. As business becomes more complex the farm manager will have to limit his activity more to major decisions of production organization, capital in- vestment and marketing. The manager will have to rely to a larger extent on specialists in particular areas of the busi- ness. Large farms already often hire one or more specialists — such as soils tech- nicians, irrigation engineers, entomolo- gists, plant pathologists, agronomists and nutritionists — as permanent members of the labor and management force. In- creasingly, farmers are relying on ac- countants for record keeping and tax * work, on lawyers for legal advice, and other consultants for special assistance. In line with these trends, California agri- * culture might also see the development of specialists in farm management whose services are purchased much as any other ^ important input in agriculture. However, the widespread use of hired farm man- agers in complete operation of farms as is found in other sectors of the United i States is not expected in California. Pro- fessional farm managers here will more likely be used as consultants. [46 ' : -y '•X-^TV'' f-V? '-v.'>T,r'/^ ■i!-.';'- , :-:o>T-. -"i-'fe;^- APPENDIX 'r^Vi''!^-' ; l^^r^ lj -' '• Procedures Underlying Cali- fornia Production and Yield Estimates in Table 2 Construction of production measures The construction of production meas- ures used in this study follows methods outlined by the U.S.D.A. (1957). For example, the Index of Crop Production used by the U. S. Department of Agri- culture is calculated by index-number formula (1): (1) /, n Z Via Pic X100 It refers to the index number in year t. Production of crop i in year t is denoted by qit\ production of crop i in the base (or weight) period is denoted by q% . Price of crop i in the base period is de- noted by pi . In this study, formula (1) is used in deriving production indices for the crop categories defined in tables 2 and 3. For example, an index of feed grain production in year t would be de- rived as quantities of corn, oats, barley and grain sorghums produced in year t, multiplied by their respective prices in the base period and divided by the price- weighted quantities produced in the base period. Production indices for the food grain, and the fruit and vegetable sub- categories are derived by parallel pro- cedures. In this study California production is weighted by average prices received by farmers in the Pacific region; United States production is weighted by average prices received by farmers for the United States. Following U. S. Department of Agriculture procedures, two weight pe- riods are used: average 1947^9 prices are used as weights for 1940 and subse- quent years; average 1935-39 prices are used as weights for the period prior to 1940. 1 The two series are spliced by com- puting overlapping quantity-price aggre- gates for 1940 and adjusting the pre-1940 series to the post-1940 level. 2 Projections of California's share of United States production Two alternative assumptions are made regarding California's projected share of United States agricultural production in 1975: (1) California will produce the same share in 1975 as the average of 1954-57; (2) California will produce a changed share in 1975 based on projec- tions of historical shares. Since share projections are made on a crop-category basis, the problem of weighting produc- tion components again arises. As before, 1947-49 price weights are used for the post-1940 period and 1935-39 price weights are used for the pre-1940 period. Z*uK (2) S t = - 2 VitVio X 100 Equation 2 defines California's percent- age share (S t ) of total United States pro- duction of a certain type (e.g., feed grains) in year t. Primed terms indicate California data; unprimed terms desig- nate United States data. The historical shares of total United 1 For a partial listing of these price weights see U.S.D.A. (1957), tables 17 and 18. 2 For details of the splicing procedure see ibid., pp. 21-27. 47 ] States production produced by California for the various crop categories are shown in figures A-l to A-15. The share defini- tion of equation (2) is used for all cate- gories which include component crops except for dry edible beans (figure A- 12). The extremely large number of types of dry beans made the price- weighting procedure impractical from a data collecting and computational stand- point. Thus, the percentages for dry edible beans are based directly on ton- nages produced in California and the United States. The projected shares for 1975 in figures A-l to A-15 are based on regres- sion equations with percentage share as the dependent variable (Y) and time as the independent variable (T). Simple linear relationships appeared reasonable for all of the crop categories except citrus fruits and potatoes; quadratic functions were used for these crops. The use of a statistically fitted function rather than a free-hand line does not imply greater accuracy in the projections, but merely removes one source of subjectivity. Sub- jective elements in the analysis include selection of the initial year used in devel- oping the regression lines, and omission of unusual years. The 1954-1957 average percentages were used in the A (same share) projec- tions of table 2 (in text). The 1975 per- centage share projected by regression analysis is used in the B (changed share) projections of table 2 (in text). How- ever, the changed-share projections based on regression equations are modified by judgment for cotton and feed grains. Cotton-acreage restrictions are assumed to be gradually relaxed over the next 15 years. Therefore, California's percentage of U. S. production in 1975 (15 per cent) is assumed to lie midway between the 1954-57 share (10.88 per cent) and the 1975 share projected from historical non- allotment years (18.67 per cent) . Despite the fact that California's share of U. S. cotton production is projected to expand over the next 15 years, the state's share of U. S. feed grain production is expected to remain at about the 1954-57 average percentage. Since cotton allotments, growers have accumulated experience and knowledge of feed grain production, which should improve the comparative advantage of these crops. Y= 0.8485+ 0.01 53 T (T 1918 =0) c3 (Cotton allotment years 1950 and 1954-1957 omitted in making projection.) 1920 1930 1940 1950 1960 1970 1975 Fig. A-l. FEED GRAINS: Historical and Projected Percentage of Total United States Production Produced by California (production of individual crops weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). [48] 50 40 Y = 15.0500+ 0.1 442 T Cr,*.»<» r 1920 1930 1940 1950 1960 1970 1975 Fig. A-2. RICE: Historical and Projected Percentage of Total United States Production Produced by California (production weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). 40 30- c 0) a. 10 Y= 15.8109-0.1767 T (Years 1933-1936 omitted in making projection.) 1920 1930 1940 1950 1960 1970 1975 Fig. A-3. ALL WHEAT: Historical and Projected Percentage of Total United States Production Produced by California (production weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). 1.9700 +0.0392 T (Year 1945 omitted in making projection. 1920 1930 1940 1950 1960 1970 1975 Fig. A-4. APPLES: Historical and Projected Percentage of Total United States Production Produced by California (production weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). 20 1960 1970 1975 1920 1930 1940 1950 Fig. A-5. CITRUS FRUITS: Historical and Projected Percentage of Total United States Production Produced by California (production of individual crops weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). 1920 1930 1940 1950 1960 1970 Fig. A-6. GRAPES: Historical and Projected Percentage of Total United States Production (in tons) Produced by California. 1975 1960 Fig. A-7. FRUIT OTHER THAN APPLES, CITRUS AND GRAPES (OMITTING PERSIMMONS, POMEGRANATES): Historical and Projected Percentage of Total United States Production Pro- duced by California (production of individual crops weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). 60r 50 §j 40 u ai a. 30- 20 (T, 924 = 0) 1920 1930 1940 1950 1960 1970 1975 Fig. A-8. TOMATOES: Historical and Projected Percentage of Total United States Production Produced by California (production of individual crops weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). £20 1920 1930 1940 1950 1960 1970 1975 Fig. A-9. GREEN, LEAFY, AND YELLOW VEGETABLES: Historical and Projected Percentage of Total United States Production Produced by California (production of individual crops weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). 1920 1930 1940 1950 1960 1970 1975 Fig. A-10. OTHER VEGETABLES: Historical and Projected Percentage of Total United States Pro- duction Produced by California (production of individual crops weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). [51] 40 30 c If 20 0) Qu 10- Y = 1 . 1 490 4 0.5890 T - 0.0048 T 2 (T 193 o=0) 1920 1930 1940 1950 1960 1970 1975 Fig. A-ll. POTATOES: Historical and Projected Percentage of Total United States Production Produced by California (production of individual crops weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). 1920 1930 1940 1950 1960 1970 1975 Fig. A-12. DRY EDIBLE BEANS: Historical and Projected Percentage of Total United States Production (in tons) Produced by California. 1975 Fig. A-l 3. SUGAR BEETS: Historical and Projected Percentage of Total United States Production Produced by California (production weighted by 1935-1939 average prices before 1940 and 1947-1949 average prices after 1940). [52] 20 10- Y= 0.2034 + 0.41 03 T (Cotton allotment years 1950 and 1954-1957 omitted in making projection.) 1920 1930 1940 1950 1960 1970 1975 Fig. A-l 4. COTTON: Historical and Projected Percentage of Total United States Production Pro- duced by California (production weighted by 1935-1939 average prices before 1940 and 1947- 1949 average prices after 1940). 100 55 90 Y= 90.6382-0.0183 T (T 1937 =0) (Data for 1956 omitted because of change in basis of reporting for U.S. production.) 80 1920 1930 1940 1950 1960 1970 1975 Fig. A-l 5. WALNUTS: Historical and Projected Percentage of Total United States Production Produced by California (in tons). Construction of 1975 California production indices in table 2 Tables A-l and A-2 summarize the cal- culations used in obtaining the 1975 production indices reported in table 2 in the text. The calculations convert Daly's 1975 output projections for the United States (1953 = 100) into 1975 output projections for California (1954-57 = 100) . The columns in tables A-l and A-2 are defined below. The symbols q and p refer to quantity and price; i refers to the i th commodity in a crop category with n crops; California data are primed; United States data are unprimed; 53, 54- 57, 47-49 and 75 refer to years 1953, 1954-57, 1947-1949 and 1975, respec- tively. Col. 2 = 1953 United States production weighted by United States aver- age 1947-1949 prices = Ti ^i,^Pi, 47-49 Col. 3 = 1975 United States projected production index weighted by United States average 1947- 1949 prices (1953 United States production = 100) 2 ^,75^,47- 19 Z^ % Qi, 53 Pi, 47-49 [53] Col. 5 = Projected California percentage Col. 7. = 1954-1957 average California of 1975 United States produc- tion weighted by average 1947- 1949 prices S«i».Pi production weighted by Califor- nia average 1947-1949 prices n 4-( $1, 54-57 Pi, 47-49 47-49 ^ Qi, 75 Pi, 47-4 X 100 From these data, column 8 is computed as follows : Col. 8 (Col. 2)(Col. 3)(Col. 5) (Col. 7) 2 QiuPi, S ffi 75 Pi 47- X 100 S^TlPi 47-49 Ay ^t, 54-57 P», 47- X 100 £*i 54-57 ft, 47 Pi = 1975 California projected production index with components weighted by 1947- 1949 average California prices (1954-1957 production = 100). Detailed yield projections Table A-3 provides actual 1954-57 and 1975 projected California average yields per acre for the major crops and crop categories considered. As a check on consistency, the 1975 yield estimates of table A-3 (based on estimates of scien- tists at the University of California) were compared with those of Barton and Rogers. 3 In general, the estimates from the two sources were quite consistent. 3 Unpublished California 1975 yield estimates used by Barton and Rogers, obtained by private correspondence. Developments since Barton and Rogers made their estimates in 1954-55 explain the divergent projections for a few spe- cific crops. For example, recent and pros- pective developments of hybrid grain sorghum raised the 1975 yield prospects for that crop compared with estimates made in 1954-55 by Barton and Rogers. Rice and cotton yield projections in the present study also are somewhat higher than those employed by Barton and Rog- ers. Unfortunately, absence of U. S. De- partment of Agriculture 1975 yield projections for fruits and vegetables pre- cludes comparisons for these crops. [54] (8) 5 Calif, i jection duction ndex -57 = 100) t~ e 'i 2 45 CM • CO 00 • «n CO Ui oc • lO »c • CO CM CN CM oe oc 00 S rO + W • o o • CN cr Ui cc • CM CN . eo T «o ^ © © «^ 197 pre pro (1954 co A I-l a Meg ~z z ' f - Sj fa ci >> m « O O 00 o S o o «5 © CN © W 00 N © © © »c an is tha present r than d an dolla 7) aver, ICal actio) tedb avera 9 pric >C Ui 00 © © 8 § »o o CM •«*« CM «o cc ^e cc t«. o ! o* © • o o OC CO TT — -r — s © © ee • »o I- • CO 3 as cr • CO T ' M N C oc OC 1- ( 954-57 annua prodi weigh Calif. ; 1947-4' • © CD «5 UB ffi • © CD CC © © e 1^ .« +j CJ — w O co ' pj O CNJ lO ©* I-' CNJ _ -r o ftf^S? ~f >o — i c © a o c r^ CD CN = § 2 g ~>o^^~ <2 S *" ^< rC tr. el 0.0_0 «>g CN 00 CO c a •o ** 00 CN CO CD OC CC © text, ply in i (in-s d bag a_i g'c •*F -*l CO cc -* c OS !>■ © CO CC © a Ui t^ iS !>. © CN CO l^ 00 CC ■* O) N cc cc Le i. BUP] tone oun (6) 1975 Calif, jected prod weightec U.S. ave: 1947-49 p X B « • t>T CN a: CO cc • co u: • © J^ CC oc CM g u: cc • CO CN • © CN 00 ■ oo u: ■ h h a UI c CO •^ "5 cc 5 • co o CN 00 Ui i— i • 00 oc r -D re © CN •"* © CO 50,3 76,7 94 8 w. a -t c< jo t. 09 a CN CN i-i CM •"»■ Bin tal su alnut is is 1 01 1 s 1975 Projection percentage of to r almonds and w r dry edible bear (5) Calif, percent- age of 1975 U.S. total production sam as 1954-57 average s QC • O 00 • u: EC iC »C ■ "* c= • © c :SS . rt -H CT CC OC a oc c CM ■ CD CC • © OC • CD ■ CC CC CO ^t r^ b- • © »-■ »fl • CO l^ CC CM •t Ui QC © © V re © ■>* ■ ■* CO IN r- CN CN — A CS ® O o ® &t z*z a I o n-ri s. CO © © O CC c CM CC en io «; c oc 03 C CO J. oc • CO oc :| r -c oo cr • CN IT • ^h CT> CN (M CN co cr £ X e • <-! © © — • © u; • © CO CC u- OO 00 c a oc • oo © ■' cc t^ t^ • TT CO CM ■ OS «5 CVl c c © 00 c t^ oo oc t- CD ?^_ -- * CM o CO IC ■^ CC ^ ^ c -r CM r- CN cc u: W N ^ cc !>. o- CM cc _ fl ^ a ai^.S+^8 2 (3) 75 U. oject duct ndex 53 = 1 •X • co a- • CN Tt ■* oc ■ co c- .i-l to ■«* CO © ^ o- o ■ © oc ~ CO rf • Ui Tt • oc >o ■^ , © — CN s» • ■— ' r-l I- • r-l T-l »- 05 <-; p.rt os s, 'S - 1 ft S -- 1 Si a ^-^ 8 o U S. ion [by rage rices e o © O cc C e © © © <= to •* a c © © cr 1 *5 — c e o c © c OO OS O" e c © C © O CN e c © c CN CC ■^ CN O- c £ (2) 1953 U. product weightec U.S. ave; 1947-49 p: cc • CO CC • CN >c © cc • © OC • OS CO oc lO CD -^ 8 c- • 00 CN • CC © © u; . Ui c- • 00 o t a CO *» •B u • OO iff • © cc • CC o- cc © Tf CN CC • © © c- • « S ff f r-i Tt CD Tf< cc "S — CO 1-1 t^ ec 0C O) N N CO CC CM Tf cc cc r-l •** CN ": cr CN .2 «a"« 5.S fl «^ rf =c cr -- ■ . — — — IJ cj SiS^" Er. -:-^ -H> 03 X O Depar offici 3 com j n tabl r than rous U.S. ng Service mtain sami jection B i tons rathe •)— fl) ategory ^ V _o aj-~ u c - 2o_2«a| a o 1 o c 33 c a c o r. t - a >v C © =3 C a * Data from and Livestock I i ( 'iop oateg { Based on l § Unit, for gr, or C 1 a 52 C '§ o M a -a .« o ^ a - • a. ."§1 2 *< ■ 2 to i a c f- c III ■j s s 4) O tj ■S o g ^ If H ~ C 1 i -E a. > 5 s a 1 5 C c c c Pt h fe Eh > fl- P a: C SoO c c § §•2 ^V r-~ IS-Sfc + CO a 5, os CM »o 00 01 03 2~ o-° 2-2 03 -3 3-£ o3os "I 5 ^ O.SP^tJ. S 5 a fe ^ OS n • . © co D "« - >> be © » gjO 08 O 5 CO •3 CO - O §8§§ »o o o o IO O CM O CO •«}< *e> co cm CM ^ CM o 1^ o o o o os CO 5 O » CO • o co »a © • CO O OS OS — < IO id CM ■ CO M* ■ « to Ol ■ CM t^ CM ■ CO CO CO CD ©_ CO o OS OS OS eo t- O CM IO CO OS o OS o OS e o 1 • co »o • CM • "* © CM Tf N O! "O • OS O • CO O ■ r- os os • kfi CO CM £ °, CO us o -< O CO © © t^ © O © —C T}< O O H Tf © CM »o l^ CM CO © OS OS t^ CO "0 » it) UJ ■ CO oo ~ © ■ O CO CO © ■ (O N O « • t- t- Tf< IO ■ CM W5 • OS «5 • i-h OS CM . OS CO CO ■ Tfi CO CM • 00 © co »o CM —i • CO N t N T*< ■<* CO CM CO »0 ■ OS U0 CM ■* ■* o CO t— T © © © co © CM © © © © CM IO O CO CM -h tf £ 2 © _ 3 a e 5 5*25 2^boo O CO -P > © * 03 5: a -^ 5 o ^§ ra coQ.5 .2 *-'C° 3 .§■8:51 o rj « 03 «"g 5 i§ sari .§> +a Q. 3K5CC C rt -a-«2C-S 3 o I 5 ^»aS| = ■i| c 2o3 rt cc o o I^^S^ .5 5. 2 Sa a "55 if If 11 2 S-2 g-0 M-^ 03 *,5 0) ih X © o 1^ T3 00c £3 03 . •as 2.2 s o^ S3 o Q.J> a a.2gc8 P ©"3.S.2 2-2t3^"S t. 0) 03 O o ©02 co « *h J v+3 a© m'* - ^ O co ^ « C fc, 03 > o Zi aSj if 3.2- © -3 w o o Table A-3 STATE AVERAGE 1954-1957 YIELDS AND 1975 PROJECTED YIELDS FOR CALIFORNIA CROPS Crop category Unit State ave. 1954-1957 yields 1975 projected yield level State ave. 1975 projected yields Yield index Feed grains Corn Oats Barley Grain sorghums. Food grains. Rice Wheat... Fruitsf . . Apples . Citrus. Grapes . Other.. Tree nuts.. Walnuts . Almonds . Vegetables^ Processed tomatoes Market tomatoes All tomatoes Leafy-green and yellow. Other Potatoes! Dry edible beans . Sugar beets Cotton bu. bu. bu. bu. bu. bu. bu. tons tons tons tons tons tons lbs. lint 65.0 33.2 38.1 54.0 79.3 20.9 419.0 6.2 0.59 0.50 17.0 7.6 253.0 1382.0 21.1 885.0 78.0 41.5 43.8 70.2 111.0 19.9 460.9 7.2 0.73 0.55 25.0 20.0 300.0 1,500.0 25.0 1,150.0 (1954-57 = 100; 118* 120 125 115 130 140 95 110 115 116 110 124 110 147 263 203' 120 120 119 109 118 130 * Components weighted by 1954-1957 relative value. t Yields per bearing acre. I Yields per harvested acre. 57 LITERATURE CITED American Feed Manufacturers Association 1958. Estimated feed use and supplies for feeding year beginning Oct. 1, 1958. Barton, Glen T. and Robert 0. Rogers 1956. Farm output, past changes and projected needs. U.S.D.A., Agr. Info. Bui. 162. California Crop and Livestock Reporting Service 1958. California field crop statistics, 1944^-57. June. California Department of Employment 1958. California annual farm labor report, 1957, p. 9. 1959. California annual farm labor report, 1958, pp. 8-9. California Water Resources Board 1955. Water utilization and requirements in California. Bui. 2, Vol. 1 :226. Daly, Rex F. 1954. Some considerations in appraising the long-run prospects for agriculture. National Bu- reau of Economic Research, Long-Range Economic Projection, Studies in Income and Wealth, 16:143-153. 1956. The long-run demand for farm products. Agricultural Economics Research, 8 (3) :73-91. Dean, Gerald W. and Chester 0. McCorkle, Jr. 1958. Limitations of alternative approaches to agricultural adjustment. Proceedings of the Western Farm Economics Association, 31st Annual Meeting, August 13-15. pp. 97-101. Mimeo. 1960. Trends for major California crops. California Agr. Exp. Sta. Berkeley. Cir. 488:1-86. Federal-State Market News Service 1959. Barley Market Review. San Francisco. Semi-annual report, June 22. Hagood, Margaret Jarmen and Jacob S. Siegel 1951. Projections of the regional distribution of the population of the United States to 1975. Agricultural Economic Research 3(2) :41-52. Hedges, T, R. and W. R. Bailey 1952. Appraisal of California agricultural productive capacity attainable in 1955. University of California, Giannini Foundation of Agricultural Economics Mimeo Report 130. Hoos, Sidney 1960. Grower cooperative canneries. University of California, California Agriculture 14(1) :4, 6. Hopkin, John A. 1957. Cattle feeding in California, Bank of America, San Francisco, pp. 1-47. 1957a. A study of farm size in California. Bank of America, San Francisco (unpublished) . Lee, Ivan M. 1958. Annual index numbers of prices received, marketings, and production, all farm commodi- ties, and index numbers of acreage of crops, California 1910-1955. University of Cali- fornia Giannini Foundation of Agricultural Economics Mimeo Report 201. McGlothlin, Robert S. 1957. Hay and feed grains in the West. Arizona Agr. Exp. Sta. Tucson. Bui. 289:1-37. Shultis, Arthur and G. E. Gordon 1959. California dairy farm management. California Agr. Exp. Sta. Berkeley. Cir. 417 (rev.) : 1-50. Simmons, Richard L. 1959. Optimum adjustments of the dairy industry of the Western Region to economic conditions of 1975. University of California, Berkeley. Ph.D. thesis (unpublished). U.S.D.A. 1957. Agricultural production and efficiency. Major Statistical Series, Vol. 2, Agric. Handbook 118, ch. 3. 1958. Contract farming and vertical integration in agriculture. Agr. Info. Bui. 198. 1959. Changes in farm production and efficiency. Stat. Bui. 233, p. 7. 1959a. Production expenses of farm operators, by states, 1949-58. AMS-85 (Revised 1959). 1960. The farm income situation. Agric. Marktg. Service, No. 179 (Supplement). October, pp. 4^5, 8-9. Wohletz, Leonard and Edward F. Dolder 1952. Know California's land. California Department of Natural Resources and U. S. Soil Con- servation Service. February. 10m-4,'61(B6789)JF