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Rice prices expected to see spike as yield rates fall 25 percent

October 30, 2014
Rice prices in Southern California are rising as a result of the drought.

Rice prices in Southern California are rising as a result of the drought.

Rice prices are expected to see a spike as yield rates fell 25 percent from last year in Southern California.

According to industry sources Wednesday, the $5 billion rice industry is suffering losses from the drought in the region.

Southern California has the highest rice output in the United States after Arkansas, with about 500 million pounds distributed to about 100 countries around the world each year.

The amount of crops decreased this year due to limited water supply in the region, which resulted in a smaller cultivation area — 420,000 acres, a 25 percent decrease from last year.

Mike DeWitt, a rice farmer in Northern California, told the Associated Press he planted 700 acres on his Woodland farm this year instead of the usual 1,000 because of a 30 percent cut in water supply.

“I think it’s the worst as far as the California rice industry is concerned on record,” he told AP. “One more dry year, and I think the impacts on California rice farmers will be devastating.”

Currently, the price of a 100-pound bag of Calrose rice is about $24.50 to $26.50. In 2010, the same bag cost $20.27.

Newly harvested rice sold at Southern California Korean markets have also seen price increases, up to $9.99 this year for a 20-pound bag from $7.99 last year.

Industry sources said price changes will depend on the amount of rainfall the region receives this winter.