Thursday, June 5, 2008

The $19 Billion Question

What Happens to Your Food When Beekeepers Go Out of Business? (and They Are)

People who keep bees commercially keep them to make a living. They take them far and near to fields and farms so the bees can pollinate the crops they are visiting. This is their most-often discussed activity, now that they are dying in droves and the food they help produce could possibly be reduced. Probably the most cited statistic in the entire Colony Collapse Disorder business is the Cornell study that says honey bees help contribute somewhere in the neighborhood of $15 billion worth of food production in the U.S. on an annual basis. This figure is over eight years old (done in 2000), so with inflation that figure should rightly be moved up to just short of $19 billion today. That’s the real number here.

This figure, however, doesn’t include the money paid to beekeepers for all this effort. A quick calculation of that number, without real good data available, would probably underestimate this amount, but you would be close if you counted the number of colonies used to pollinate crops in the U.S. in a season and the number of crops those colonies pollinated.

For instance, right about 1.25 million colonies pollinated almonds in February this year. Each colony earned, on average, about $125, some much higher, some lower, but that’s a useful, conservative figure for this exercise. That comes to $156 million, give or take a few thousand. But each of those colonies earns more each year, or should be earning more anyway. One estimate is that each of these colonies pollinates an additional 1.5 more crops, on average, at about $50/colony, or say roughly, and conservatively, another $75 income/colony. That amounts to $93.8 million, for a pollination total of $250 million.

The discrepancy between almond pollination fees and the fees paid by other crop growers has been studied, and one industry official put it bluntly: the almond industry is subsidizing much of the rest of the ag industry by paying so much, so they can get away with paying so little. There’s quite a bit of truth in that statement.

But it costs right about $100 to support a colony every year ... that’s labor, food, boxes, transportation (and that cost is adding about another $5 this year) and medications ... and that comes to $125 million, so those beekeepers are collecting about $75/colony over an entire year.

But figure an average 25% loss every year ... that is, colonies that don’t produce those figures and that $75 is reduced to about $56 or so. But if those losses go up, to, say, 40% (last year I figured they were 44%), that income number is further reduced to about $40/colony. To replace those bees that were lost, by the way, that $40 buys only a third of a colony, so you can see where the rest of this pollination money is going.

However, like those commercials for Ginsu knives ... “BUT WAIT, there’s more!” There’s ... yes, honey. Bees do make honey, and this year the selling price of the honey they are making is finally reasonable ... not spectacular, or even great ... just reasonable. On average, a commercial honey bee colony will make right about 75 pounds of honey in a season, some much more, some less. Some years 200 pounds isn’t uncommon, some years, like last year, 40 pounds is a good crop.

Right now honey, domestic honey, the good stuff made here in the U.S., is selling for over $1 a pound ... it’s been in the $0.60 – 0.75/pound range. You can do the math ... even this year, beekeepers barely make enough honey to pay for the upkeep of a colony. Pollination is the name of the game ... pollinate or die.

But honey ... where does that honey go, really? Most domestic honey ends up in bottles on grocery store shelves. That’s because it’s good honey ... good eating honey anyway. But there’s not nearly enough of it to go around. In fact, the U.S. imports 60% of the honey we eat because we can’t produce enough of it here.

But at even $0.75 a pound, a colony is only going to make about $55 a year for a beekeeper ... $45 short of breaking even, way short of replacing 25–45% of his colonies just to get back to even, and we haven’t said anything about profit, have we?

The Daily Green/Istock Photo Illustration

So if you want to worry about something, you can worry about the problem of your food prices going up because of colony losses to CCD, or you can worry about even more imported honey of questionable quality coming into the U.S. to make even more Honey Nut Cheerios, or, and this is what I’m doing, you can worry that no matter how many colonies a beekeeper has, no matter how many crops he pollinates and no matter how much honey he produces he is going to have to stretch every dollar he makes just to break even, and most aren’t breaking even.

So what do we do when they go broke and there are no more beekeepers? That is the $19 billion question.

Photo Credit: Istock Photo Illustration

Original here

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