The price of rice for consumers in general will rise. California drought threatens sushi

Sushi eaters could face sticker shock the next time they order a California roll or check the box for another round of yellowtail nigiri.

Thanks to the historic drought in California, prices may spike for the specialty rice used in the popular Japanese dish. Production of the rice, which is grown primarily in the Golden State, is expected to drop by 25 percent this year.


California — and the Sacramento Valley in particular — is the nation’s primary source for the high-quality short- and medium-grain rice used in sushi and is a major supplier of the rice for other countries, too. But the state’s 2,500 rice growers this year planted just 420,000 acres, about a quarter fewer than usual, because farmers weren’t allowed to use water for more, according to the California Rice Commission.

California farmers are beholden to a patchwork of local, state and federal water sources that distribute their annual water supply. More and more farmers are getting less or even no water allocations as the drought drags through its third year.

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“The biggest challenge is simply not enough rain and snowfall for multiple years, coupled with all of the demand from the most urban and top [farming] state in the U.S.,” California Rice Commission spokesman Jim Morris said. “Being in charge of the water allocations is a tough job right now: precious little water and many areas of need in our state.”

The drought has taken its toll on the vast majority of farmers in the country’s largest agriculture state. About a half-million acres that would normally be producing fruits and vegetables this year won’t be planted, according to the California Farm Bureau Federation.

A huge chunk of the state, including its largest produce regions, continues to experience what government meteorologists consider “exceptional drought” conditions — the worst possible category that can be assigned by the USDA’s National Drought Mitigation Center. Most of the rest of the state is considered to be in either “extreme drought” or “severe drought.”

Congressional staffers are reportedly working behind the scenes to reach a compromise on House and Senate bills aimed at providing relief from California’s drought.

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But any changes will be too late to affect the 2014 rice market. As the harvest is set to finish in October, production could be down by more than a billion pounds, Morris said.

Growers in the Yuba City-based California Rice Marketers cooperative — a group of six rice farms that normally plant on 2,000 acres — may not feel too much pain. They planted less this year but hope to see their prices go up from the roughly $20 per hundredweight they received in 2013 to as much as $24, General Manager Kevin Keeley said.

And California Heritage Mills, a Colusa County rice mill owned by 15 farmers, can expect something of a windfall. The three-year old co-op planted all its acres this year and also hopes to get a better price, said Guy Gomes, the company’s sales and marketing director.

The real pain will be felt at sushi restaurants. They will continue to serve their usual fare of spicy tuna rolls, California rolls and yellowtail rolls, but soon they’ll have to make a decision about whether to pass on the expected added cost of their product or see a reduction in profit margins, said California Restaurant Association spokeswoman Angie Pappas.

Nobody knows yet how much those costs, and the price of rice for consumers in general, will rise.

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“There’s only a harvest once a year and the majority of [sushi rice] comes from California,” Pappas said. “Everyone’s still in a wait-and-see mode to see how much the prices go up, but then you’re going to definitely see some price-tweaking.”

Daniel Sumner, director of the University of California’s Agricultural Issues Center, said that so far he expects only small price increases on Japanese restaurant menus.

Overall, the sharp reduction in California rice planting “is going to show up in higher prices,” he said. “There’s no question about it.”

Hissho Sushi, a Charlotte, N.C., company that trains chefs for sushi bars throughout the U.S., is bracing for the higher prices, too.

Spokeswoman Andrea Lee said the company’s California supplier “is already factoring in price increases due to the drought situation during the past several months. … It’s a huge challenge to anticipate and plan ahead for the unforeseen. Over 50 percent of our sushi rice is directly impacted by this drought, as are the ensuing price changes and supply.”

While California rice may be in short supply, rice growers in other parts of the country are expecting a bumper crop. In fact, overall rice production in the U.S. is expected to increase by as much as 21 percent this year, according to the latest Department of Agriculture forecast.

Farmers in Arkansas, Louisiana and elsewhere in the South have historically grown long-grain rice, but these states have begun ramping up production of medium-grain in recent years.

However, sushi chefs are prejudiced in favor of the California variety, said Morris. Farmers there grow special varieties of Japonica rice that make the state the only source for Japanese importers, he said. It’s perceived as tasting better and having a better mouth feel.

There are certainly some export customers that may be willing to take Southern medium-grain rice in lieu of the California product, said Chuck Wilson, director of the University of Arkansas’ Rice Research and Extension Center, but he doubts sushi restaurants in the U.S. are ready to make the switch.

And that’s what has rice grower Keeley most concerned.

“What I’m worried about is: How high does the price go, and does that start driving demand away? If the price gets too high, does the end user start going to substitute products or maybe an inferior rice?”

This article tagged under: Environment

Restaurants

Drought

California

Politics

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Weather

Food

Sushi

Rice

Agriculture