Murphy: Walnuts – where’s the money?

If you have found yourself in a supermarket looking at shelled nuts and wondered why they are so expensive join the club, because as a walnut grower I have wondered the same thing.

We were recently paid for this year’s crop and the returns were pretty grim, good quality conventionally grown Chandler variety walnuts only yielded $1 per pound after deductions for the walnut marketing board, walnut commission, hulling, drying, shelling, sorting, grading, etc.

The only thing growers don’t pay for is putting them in a bag and sending them to the store, two fairly simple steps in the overall process of getting nuts to you, the consumer. So where did the rest of that $6 to $13 dollar per-pound shelf price go?

Look at any reference source for supermarket profit margins and you will see the same thing: typical rates are 1 to 3 percent. It seems unlikely this is the case with walnuts, because that would mean the distributor is getting on average over $8 per pound, I suspect they are making a good profit but that supermarkets are the ones taking the lion's share of the proceeds when it comes to nuts.

In Lake County walnuts are grown more sustainably than anywhere else in California, about half of our acreage is dry-farmed and few if any pesticides and herbicides are used, unlike in the Central Valley where they have more pest issues due to the warmer winter climate.

Walnuts are one of the healthiest foods on earth, with high levels of protein and Omega 3 fatty acids, so if high costs keep them off the consumer’s table we give people one less healthy food option. The bottom line is if you can’t afford nutritious food you are are likely going to be less healthy – more is at stake here than just what they cost or who gets the money.

One dollar per pound is an unprofitable rate for growers, it means old orchards will not be replanted as they reach the end of their lifespan, and there won’t be new orchards planted either – without a change in the dynamics the end of commercial walnut growing here is in sight.

This year’s impacts of tariffs as high as 120 percent on walnut exports didn’t help, but consumers saw little or no sign of the glut of nuts on the prices at the market, a glut which was created primarily by obvious profiteering and not by a faltering export market.

Returns have been bad for the last three years and there is no sign of an end in sight, 2018 was not an anomaly year or part of a cycle, it is the new “normal.” It was so bad that one processor advised growers to consider not hiring tree shakers or harvest crews, as clearly there would be no profits to pay them.

It seems likely if there was a similar situation in the local wine grape industry there would be a swift alarm raised by politicians at the state, federal and local level, but even our walnut grower state Assemblywoman Cecilia Aguiar-Curry has been strangely quiet on the subject.

Are the people who are reaping huge profits off of the hard work of others while destroying what's left of family farming in America at the same time buying the silence of our politicians? Or is this an organic dysfunction?

Is it OK for family farming to die off in our lifetimes due to sheer greed and manipulation of the markets? Is it OK for consumers to be given the choice of being gouged for nutritious food or being less healthy?

Is it good for the country if even more of the wealth is in the hands of fewer and fewer people who do the least amount of work and take the least amount of risk?

Is this the new American way?

Phil Murphy lives in Lakeport, Calif.