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Citrus impact to economy: $7 billion – from the Business Journal

By Frank Lopez

A new study commissioned by the Citrus Research Board (CRB) values the total economic impact of California’s citrus industry at $7.117 billion.

Bruce Babcock, Ph.D., a professor in the School of Public Policy at the University of California, Riverside, conducted the research and his findings quantified the impact of citrus on the state economy.

“California citrus is a major contributor to the economic value of the state’s agricultural sector and is much larger than just the value of its sales,” Babcock said. “Estimated full-time equivalent California citrus jobs totaled 21,674 in 2016-17, and estimated wages paid by the industry during that same timeframe totaled $452 million.”

According to Babcock, the California citrus industry added $1.695 billion to the state’s Gross Domestic Product (GDP) in 2016.

Babcock found that for the years of 2016-17, the total direct value of California citrus production was $3.389 billion. Economic activity from related business that supplied materials and services to the citrus industry generated an additional $1.263 billion, and on top of that, $2.464 billion in economic activity generated by household spending income that they received from California’s industry brought the total economic impact to $7.117 billion.

The study revealed that 79 percent of the state’s citrus was packed for the fresh market and 21 percent was processed in 2016-17, a big significance, as fresh market fruit is valued higher than processed fruit.

California Citrus Mutual President Joel Nelsen commented that the report sheds some positive news about the state but insists that farmers and growers should be cautious of a deadly crop disease epidemic.

“This enthusiasm must be tempered by the fact that huanglongbing (HLB) can destroy all this in a matter of a year if the partnerships that exist between the industry and government cannot thwart the spread of this insidious disease,” Nelsen said. “Reading how that would affect our family farmers, employees and the state is sobering.”

The study also looked into the possible impact of a potential 20 percent reduction in California citrus or yield, or a combination of both, from increased costs related to government regulations, and crop diseases.

According to Babcock, such a reduction could cost 7,350 jobs and reduce California’s GDP by $501 million in direct, indirect and induced impacts.

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