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Home , Beekeeping, Colony collapse disorder, Honey bee

The Estimated Impact of Collapse Disorder on Fees Hoy Carman While researchers are still attempt- almond pollination requirements also ing to determine the causes of CCD, the typically lists a requirement of 2.0 hives Almond pollination fees have risen economic effects are evident. Beekeep- per acre, with five to six frames per hive. sharply in recent years. This article ers’ costs increase, as they must replace Thus, the total number of hives shows that the fee increase is due in the lost to fulfill their pollination required for almond pollination is a roughly equal parts to the expansion linear function of the number of - of almond acreage and the occurrence contracts, and the cost increase must of Bee . be passed on to the producers using ing acres of . The number of pollination services for the beekeep- hives required for almond pollination ers to remain economically viable. has, thus, increased from approximately Almond producers, the largest user 802,000 in 1992 (401,000 acres) to of pollination services in and 1,480,000 in 2010 (740,000 acres)— roduction of many California the have faced sharp fee an 84.5% increase in two decades. crops is heavily dependent on pol- increases as a result of CCD and acre- California County Agricultural Com- Plination by honeybees provided age expansion. This article estimates the missioners’ data reported 1,192,687 by commercial pollination services. separate effects of CCD and almond acre- hives used for pollination on all The most important tree crop users of age expansion on the fees that almond California crops in 1992, growing to pollination services include almond, producers pay for pollination services. 1,725,070 hives in 2008. Thus, with , avocado, , kiwi, pear, and 680,000 bearing acres in 2008, almonds prunes/plums. Other important Cali- California Almond Production accounted for almost 79% of total bee fornia crops using pollination services California, with 740,000 acres of bearing colony pollination use in California. include alfalfa seed, , melons almond trees in 2010, produces about (cantaloupes, , watermel- 80% of the world’s almonds. Approxi- Pollination Fees ons), sunflowers, and vegetable seeds. mately 70% of almond production is As pointed out by Sumner and Boriss, There is a well-organized market for exported, making almonds California’s there is a well-developed and function- pollination services with from largest-value agricultural export. ing market for pollination services, upper midwestern, northwestern and Almonds are also California’s largest with fees responding to changes in the other states, as well as California, con- user of pollination services by a con- supply and demand for pollination tracting with California producers to pro- siderable margin. Estimates place some services. Fees vary seasonally, geo- vide bees during the bloom periods for 60% of all U.S. bee colonies being used graphically, and by crop characteristics, their crops. Beekeepers typically contract for pollination in California almond with valuable crops having fees their colonies (hives) for more than one orchards during the February/March about 50% below crops that do not crop and often move their colonies from bloom period. After the almond bloom, provide valuable for honey. state to state to take advantage of differ- the hives move on to other crops with Pollination fees are highest during the ing bloom periods for contracted crops. a typical hive being rented two to three almond bloom in the February/March The pollination market and produc- times during the season. Almonds period when hive demand is at a peak. tion of many important crops is threat- were responsible for 30% of all rent- Almonds are not a desirable source for ened by a phenomenon, first identified als and 58% of all rental income in a honey production. Crops that overlap the in 2005 and 2006, in which worker bees 2007 Northwest survey by Burgett. almond bloom, including early leave their colonies in search of nectar and plums, pay fees similar to almonds. and and do not return. Named Bee Colony Requirements Data available from the 2010 Cali- Colony Collapse Disorder (CCD), this University of California cost and return fornia State Association Pol- phenomenon differs from other causes studies to establish and produce almonds lination Survey report an average fee per of bee mortality (e.g., and include 2.0 hives per acre for pollina- hive of $150.79 for almonds, $145.89 for parasites) in that there are no dead or tion in the San Joaquin Valley (North early cherries, and $128.29 for plums. dying worker bees around or in the and South) and 2.5 hives per acre in Average pollination fees for crops that hive—the worker bees just disappear. the Sacramento Valley. Literature on bloom later, when supply of hives is high

Giannini Foundation of Agricultural Economics • University of California 9 than what they considered acceptable. Figure 1. Average Almond Pollination Fee, 1995–2010 California State Beekeeping Association 180 Annual Pollination Surveys reported 15 7. 0 3 160 winter mortality ranging from 20% to 148.50 almost 30% from 2005 through 2009. 140 150.79 138.98 143.35 Increased loss of bees associated with 120 CCD increases the costs of beekeeping and reduces the supply of pollination 100 services. Beekeepers with pollination 80 contracts must replace the lost colonies 72.58 by purchasing bees to fill the empty

Fee/Hive in Dollars in Fee/Hive 60

51.99 53.67 hives. Package bees with a queen can 40 42.37 45.01 45.94 cost over $100 per hive, depending on 38.59 40.36 41.43 35.41 36.71 20 shipping, size of package, and type of bees. The empty due to CCD 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 are typically discovered just prior to, Year or as hives are being placed in almond Source: California State Beekeeping Association Annual Pollination Surveys, 1995–2010 orchards. In the scramble to secure relative to demand, are much lower than in pollination fees that occurred in enough hives for pollination require- for almonds. For example, average 2010 2005 and 2006. Thus, while greater ments, almond producers have raised pollination fees per hive were $25 for almond acreage increases the demand their bids for per colony pollination fees. , $28.45 for melons, $29.37 for for hives, and perhaps the costs of National surveys of overwinter- sunflowers, and $47.30 for alfalfa seed. providing them if the average distance ing bee colony losses did not occur Average pollination fees per hive for that hives are transported increases, it until two years after the appearance of California almonds for 1995 through does not explain the sharp increases CCD. There are descriptions of unusu- 2010 are shown in Figure 1. Average fees in pollination fees in 2005 and 2006. ally high losses in particular states or increased from $35.41 in 1995 to $53.67 regions for years prior to 2007, but Overwintering Bee Losses: High winter in 2004. The fees then increased to there are no national estimates of the losses of bees, regardless of the cause, $72.58 in 2005 when CCD first became average loss for the United States. impact beekeepers’ costs and the supply evident, and shot up $45.31 to $136.98 of hives for pollination. Losses of bee Estimation of an Equation between 2005 and 2006.Almond pol- colonies over the winter are expected, for Annual Fees lination fees continued to increase and a loss of 15–20% to be in the usual or peaked at an average of $157.03 in 2009. While the lack of a time series for over- “normal” range. USDA reports that bee Pollination services are a grow- wintering bee losses makes it difficult to colony losses have averaged 17%–20% ing and important cost component for determine the separate impacts of acreage per year since the 1990s, attributable almond production, recently account- increases and CCD on almond pollina- to a variety of factors, such as , ing for about 20% of budgeted cul- tion fees, we can still obtain an estimate. diseases, and management stress. tural costs per acre. We hypothesize First, we specify an equation for pollina- Heavy overwintering losses were that the two major factors associated tion fees as a function of bearing acre- reported in 2003–2004 for many with annual changes in almond pol- age and overwintering losses. Although northern beekeepers. Beginning in lination fees were (1) increased acre- we lack data on overwintering losses, 2005, CCD appears to be the major age of almonds, and (2) changes in we do observe that the sharp increase explanation for high winter losses. In overwintering bee colony losses. in pollination fees occurred when CCD their annual surveys, vanEngelsdorp was first identified as a problem. Almond Bearing Acreage: California et al reported four consecutive years The impact on fees of such a struc- almond bearing acreage increased con- of high winter losses in managed hon- tural change can be estimated using a tinually from 1995 through 2010, with eybee colonies in the United States. zero-one indicator variable. The equation the annual increase ranging from 5,000 Losses totaled 32% in 2006–07, 36% in to be estimated is: to 40,000 acres (Figure 2). The largest 2007–08, 29% in 2008–09 and 34% in Fee = f(BA, D) increases occurred in 2007, 2008 and 2009–10. The majority of beekeepers where Fee is the average annual almond 2009, which was after the sharp increases in each survey reported losses greater pollination fee in real (2010) dollars per

10 Giannini Foundation of Agricultural Economics • University of California hive, BA is annual California bearing Figure 2. California Almonds: Annual Change in Bearing Acreage, 1996–2010 acreage of almonds (1,000 acres), and D is a variable that has a value of zero for 45 years 1995 through 2004, and a value of 40 one from 2005 through 2010. The coef- 35 ficient for D is the average annual impact of the structural change (the onset of 30

CCD) on almond pollination fees. 25 Using annual data for 1995 through 2010, the estimated equation is: 20 Fee = -27.76 + 0.166 BA + 55.97 D 15

(-0.77) (2.30) (3.83) Thousands in Acres 10 R2 = .90 D.W. =1.89 5 where the values in parentheses are the t-statistics for the respective coef- 0 2 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 ficients, R = .90 and the Durban- Year Watson statistic is 1.89. The R2 sta- tistic means that the model explains still be in the range of $100.00 per hive. annual cost increase of $83 million for about 90% of the variation in pol- This does not minimize the real almond production due to CCD is just a lination fees between 1995–2010. costs of CCD to the California almond portion of the economic impact of CCD The estimated coefficients have the industry. Using an average of two hives in California, given that several other expected signs and indicate that the per bearing acre and an average fee crops use pollination services as well. increase of $55.97 per hive due to CCD, annual almond pollination fee increased Suggested Citation: an average of $0.166 per hive for each the estimated cumulative cost to the Carman, Hoy. 2011. "The Estimated 1,000 acre increase in bearing acre- California almond industry for the six Impact of Bee Colony Collapse Disorder age. After accounting for the impact of years, 2005 through 2010, is about $445 on Almond Pollination Fees." ARE Update 14(5): 9-11. University of California million. From 2010 forward, given cur- increased acreage, the fee increased an Giannini Foundation of Agricultural average of $55.97 per hive during the six rent bearing acreage and recent winter Economics. years since CCD was first recognized. bee losses, estimated costs due to CCD We can do a few simple calculations total almost $83 million annually. Hoy Carman is a professor emeritus in the ARE to place these estimates in perspec- department UC Davis. He can be reached by tive. California’s bearing acreage of Concluding Comments e-mail at [email protected]. almonds increased 322,000 acres over The appearance of CCD in commer- the period of the data sample—from cial bee colonies in the spring of 2005 For additional information, 418,000 in 1995 to 740,000 in 2010. focused attention on economic problems the author recommends: With an estimated real fee increase facing beekeepers and the importance Sumner, D.A. and H. Boriss. 2006. “Bee- of $0.166 per hive per 1,000 acres of bee pollination for the production conomics and the Leap in Pollination increase, the real fee increase due to of many fruit and vegetable crops. Fees.” ARE Update 9(3): 9-11. Univer- the increase in bearing acres from This paper documents another impor- sity of California Giannini Foundation of Agricultural Economics. http:// 1995 through 2010 is estimated to be tant impact of CCD, its effect on increas- giannini.ucop.edu/media/are-update/ $53.45 in 2010 dollars. In real (2010) ing costs of production for California files/articles/v9n3_3.pdf. dollars, the almond pollination fee almonds, the largest contractor for com- vanEngelsdorp, D. et al. 2010. “A Survey increased from $49.84 per hive in 1995 mercial pollination services. Costs of pro- of Colony Losses in the to $150.79 in 2010, or just over $100. duction for California almonds increased United States, Fall 2008 to Spring Thus, it appears that increasing an estimated $112 per acre annually 2009.” Journal of Apicultural Research 49(1):7-14. http://ento.psu.edu/polli- almond acreage and CCD each explain during the first six years after CCD was nators/publications-old/research-publi- roughly half of the increase in almond identified, with CCD estimated to be cations/losses. pollination costs. Even if CCD had not responsible for about half of this cost Johnson, R. 2010. “Honey Bee Colony occurred or if there were a complete increase. Pollination fees now account Collapse Disorder.” Congressional solution to the problem of CCD, pollina- for about 20% of budgeted almond Research Service. RL33938. www.fas. tion fees for almonds would probably cultural costs per acre. The estimated org/sgp/crs/misc/RL33938.pdf.

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