Wednesday, November 25, 2009

Money & Business

Bee Crisis May Drive Up Food Costs

By Kimberly Palmer
Posted 4/13/07

Late last year, beekeepers across the country began reporting that their honeybees were not returning to their hives, as they usually do. Some large commercial beekeepers have reported losing from 50 to 90 percent of their colonies, according to Pennsylvania State University's Mid-Atlantic Apiculture Research and Extension Consortium. While scientists are still investigating, possible explanations include chemical contamination, lack of genetic diversity among bees, and parasites.

Meanwhile, economists are looking into the impact of the honeybee disappearance on the country's food prices. Honeybees not only make honey, but they pollinate fruit, vegetables, and nuts. Their disappearance could start to affect prices that are already inflated from unusually cold weather in parts of the country. Here's what shoppers need to know.

(Kaia Larsen/Times Record/AP)

Why are honeybees important to the economy?

Honeybee pollination of fruits, vegetables, and nuts is worth $15 billion a year, according to a March report from the Congressional Research Service. Almonds, apples, avocados, and blueberries are among the crops that depend on the bees. Each year, producers of those crops rent honeybee hives for pollination purposes. "It's extremely important they have honeybees available," says Suzanne Thornsbury, assistant professor of agricultural economics at Michigan State University.

Will food prices be affected by the bee disappearance?

While the long-term impact on food prices will depend on the extent of the problem, agricultural economists say that consumers will most likely see small increases in prices of crops that are dependent on honeybees this year. Almonds, for example, require honeybee pollination. Walter Thurman, an agricultural economist at North Carolina State University, estimates that the price of almonds at the supermarket will rise 1 percent this year based on the increased cost of renting honeybees for pollination because they are in short supply. In other words, it will add a few cents to a $3 package of almonds.

Will honey be more expensive this year?

It depends on the kind of honey. People who prefer local honey and live in an affected area might end up paying about 25 cents more for a 12-ounce jar of honey, which typically retails for around $4. Sharon Schwahn, a beekeeper and honey seller in Hettinger, N.D., says she'll be forced to sell her bear-shaped honey jars for that much more because her costs have risen.

On the other hand, people who buy imported honey will be less affected. According to Bruce Boynton, chief executive officer of the National Honey Board, 70 percent of honey purchased in the United States is imported, which will mitigate the overall effect on honey prices. But, he adds, if beekeepers are unable to rebuild their colonies–which has not yet been determined–then honey prices will probably increase more down the road.

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