COVID Veggie Confusion and Food Prices Up-Compensation Down
**Renewed restaurant closures further complicate decisions for California vegetable farmers.
With restaurants restricted to outdoor dining, takeout and delivery, people in the vegetable business say food-service demand has dropped for a number of crops.
Farmers must decide soon on what crops to plant for winter harvest, and how much, and say they expect "roller coaster markets" when those crops reach maturity.
**In the past 12 months, food prices at grocery stores have risen 5.6%, the largest annual increase in nearly a decade.
The severity varies drastically, with beef prices 25% higher than a year ago, while fruits and vegetables are just 2.3% higher.
But, according to the National Farmers Union, the extra money consumers are shelling out for their staples isn't being passed on to producers who grew that food. In fact, the prices farmers are currently receiving are, on average, 4.8% lower than last year.
**Monthly cash flows will likely show a negative Producer Price Differential again this month. In some cases, July PPDs may be even more negative than in June.
University of Minnesota dairy economist, Mark Stephenson tells milkbusiness.com ‘without a doubt’ PPDs will be negative, but this time it won’t be because of rapidly rising prices and the lag of Class I, it will be because of the unheard of $10 gap between Class III and IV prices.